UAE VAT and TRN
Tax Registration Number
UAE VAT is the value added tax charged on most goods and services in the United Arab Emirates. A TRN is the number that identifies a VAT-registered business.
What it is
Value added tax, or VAT, is a consumption tax applied in the United Arab Emirates to most supplies of goods and services, administered by the Federal Tax Authority. A business that registers for VAT receives a Tax Registration Number, or TRN, which identifies it in all dealings with the authority. The supplier's TRN must appear on tax invoices, and the customer's TRN is shown where the rules require it.
How it works in practice
A registered business charges VAT on taxable supplies, recovers VAT paid on eligible purchases, and reports both in periodic returns. Supplies fall into standard rated, zero rated, exempt and out of scope categories, and some purchases are accounted for under the reverse charge mechanism. International transport of goods and certain services directly connected with it can qualify for zero rating, subject to conditions, while many local port and handling services are standard rated.
Why it matters
For shipping agents and forwarders the difficulty lies in classifying each charge line correctly, since one invoice can mix zero rated freight with standard rated local charges. Invoices must show the correct TRNs, the tax treatment per line and the amounts in the required currency. Agents also need to separate their own taxable supplies from amounts collected or paid on behalf of a principal. Professional tax advice is advisable for specific cases.
Official sourceUAE Federal Tax Authority
In Sailix
How Sailix handles it
Sailix lets an invoice use VAT as its tax type, in which case the office VAT ID (TRN) and the party VAT ID (TRN) are recorded on it. Customers carry a VAT number, accounting parties have a VAT/GST profile, and tax service groups hold the VAT settings applied to tariff items. Purchase journals, credit notes and debit notes can also use VAT as the tax type.
- UAE VATChoose VAT as the tax type on invoices and journals, keep the TRN on each document, and post journal tax to input and output tax accounts.
- Import invoicingRaise import invoices from the B/L with charges and tax prefilled, and keep detention and M&R invoices alongside.
- Export invoicingBill export charges against the booking and B/L, split prepaid from collect, and hold B/L issue until the invoice is receipted or approved.
Related terms
- GST e-invoiceA GST e-invoice is an Indian business-to-business invoice reported to the Invoice Registration Portal. The portal returns a unique Invoice Reference Number and a signed QR code.
- Terminal handling chargeA terminal handling charge is a fee the carrier collects from the shipper or consignee. It recovers the cost of handling a container at the port terminal.
Get started
Put your whole shipping desk on one system.
Create your workspace and run your first job from booking to settlement.