Who Has to File an Excise Tax Registration?
Businesses involved in the following activities must register for excise tax:
- The UAE’s import of excise goods
- the process of producing excise goods in the UAE before they are made available for consumption
- The UAE’s occasional practice of hoarding excise items
- A warehouse keeper is in charge of managing a defined zone or excise warehouse.
Persons’ Rights in a Tax Audit Concerning UAE Excise Liability
A taxable individual is entitled to the following during a tax audit:
- To keep an eye on things while the auditor removes the paperwork
- to retrieve the papers the auditor removes after the tax assessment.
- To object to removing any record or document and to demand and get a receipt from the auditor.
Items that Must Be Registered as Excise Items
- Carbonated beverages
- Energy drinks
- Products containing tobacco and nicotine
- Tools and devices for electronic smoking
- Liquids utilized in electronic smoking instruments and devices
- Drinks with added sweetness.
Items Exempt from Excise Tax:
- Ready-to-drink drinks with at least 75% milk or milk derivatives
- Baby food and formula
- Drinks ingested to meet specific dietary requirements
- drinks ingested for therapeutic purposes.
Accounts and supporting documents of all imported, produced, or stockpiled Excise products/ goods:
- Proof of excise products sold outside the UAE.
- Supporting documents of excise goods exported outside the UAE.
- Detailed account of physical inventory held by the taxable person.
- Account of excise goods if lost or destroyed.
- Tax record regarding tax due on excise goods imported/manufactured by the taxable person in the UAE.
- Tax record regarding tax owing on excise goods purchased or produced for stockpiling.
- Proof of tax deducted on tax paid and submitted on excise goods sold outside the UAE.
- Statement of item-wise details of excise goods physically kept by the taxable person in the context of value and quantity.
- Statement of information concerning average monthly inventory held by the taxable person.
- Statement of information concerning average monthly sales for each excise item.
- Statement of details concerning excise products manufactured by the taxable person.
- Statement of details concerning excise products purchased outside the UAE (Import) by the taxable person.
- Item-wise details of Excise goods produced by the taxable person.
- Item-wise details of Excise goods imported by the taxable person.
- Item-wise details of Excise goods sold locally by the taxable person.
- Item-wise details of Excise goods sold outside the UAE (Export) by the taxable person.
- Item-wise details of Excise goods released from the specified designated zone.
- Details of the companies and retailers for which the taxable person sells excise products.
Tax Compliance and Penalties
- The FTA is allowed to audit firms subject to taxes and fines.
- The excise list’s taxable items can be readily identified by their item codes, and the FTA’s database is directly connected to the customs division.
- If importers are registered with the FTA, they can clear all taxable items through customs when the newly added items are subject to excise duties.
- If you don’t register for excise duty before the deadline, you risk paying AED 20,000 in penalties.
- AED 20,000 in penalties may be incurred for failing to register excess existing stocks of taxable items as of December 1, 2019, before January 15, 2020.
