In case, where a VAT registered owner of the goods request another VAT registered person (“importing agent”) to import goods on behalf of the former, as the VAT registered importing agent would have provided their TRN at the time of importation of the goods, the VAT amount would be automatically pre-populated in Box 6 of the VAT Return of the importing agent.
In such kind of arrangements, below 2 options are available for owner and importing agent:
- Adjustments in the VAT return of both the importing agent and the owner of the goods in box No. 7 of the VAT return. The importing agent would make a deduction of the value of goods imported and the owner would declare the value of goods imported. The owner would then be entitled to recover the import VAT (as declared in Box No. 7 of the VAT Return) in Box No. 10 of the VAT Return as per its normal VAT recovery position. The owner and the importing agent need to agree in writing to make the adjustments. Furthermore, both parties will need to retain the evidence of this written agreement as records, in addition to other required records, including customs documentation.
- Where the owner and the importing agent do not wish to make the adjustments stated in point no. 1, the importing agent may issue a statement to the owner as prescribed in Article 50(7) of the Executive Regulations. The statement will be considered as a Tax invoice for the purpose of recovering input tax by the owner and can be recovered via Box 9 of the tax return.The Statement shall contain the following particulars:
a. The name, address, and Tax Registration Number of the agent.
b. The date upon which the statement is issued.
c. The date of Import of the relevant Goods.
d. A description of the imported Goods.
e. The amount of Tax paid by the agent to the Authority in respect of the imported Goods.