Here we will discuss all the angles through which the unregistered entity is eligible to pay Value Added Tax on the imports via an e-guarantee while having a look on the process and steps to submit e-guarantee on FTA portal:
Context for VAT Payment via e-Guarantee
- Shifting of goods from one VAT designated zone to another
- Under customs duty suspension, import of goods into UAE. Customs duty suspension is appropriate for fixed identified goods on which the importers have to pay customs duty at a reduced rate or zero customs duty.
Process for VAT Payment on Import
Given below are the processes by which an unregistered person as to pay VAT in UAE in all these cases-
A. Customs Declaration
In the personal Customs portal, the importers must prepare and propose the customs declaration and do the following-
1. Give all the important details about all the goods being imported
2. For processing, submit customs declaration by Customs
After the approval of declaration, it moves to ‘Pending tax payment’ status.
Note: After the Customs declaration is sent to the FTA then there will be no further editing in the form will be done by the customs system. The status of declaration form can be only changed to either ‘Declined’ or ‘Approved’.
B. Obtain e-guarantee (Financial security)
From their bank, the importers must obtain an e-guarantee. The process for this is-
- From the bank, get an e-guarantee form for a value equal to the value of VAT due
- For the e-guarantee, get the reference number
C. On FTA portal, create an e-Services account
The person who is not registered must create an e-Services account on the FTA portal to pay VAT on import. The sign-up process is given below-
- By entering your email id and a unique password, sign-up as a new user
- At the registered email ID, you will receive a mail to verify your email ID
- Your e-Service account will be created after you verify the email ID and you can log in to the FTA e-Service portal
D. Login to the FTA portal and complete the VAT import declaration form
The importer must submit the e-guarantee number which was obtained from the bank after the importer login the FTA e-Services portal. for VAT payment, this e-guarantee number must be submitted in the Form VAT 301- Import declaration form. The customs clearance process can be completed after the submission of e-guarantee number is processes.
The process of VAT Payment on import by registered entities is different from the process for unregistered entities. In a few cases, the unregistered importer has to get an e-guarantee from the bank and submit the same in the FTA e-Services portal.
Steps to submit e-guarantee in FTA portal in UAE
The steps for submission of e-guarantee number in the FTA e-Services portal is explained below-
1. Login to FTA e-Services portal
2. As shown below, click on the ‘VAT’ tab
3. Click ‘VAT 301- Import declaration form for VAT Payment’
4. After filling the Customs Authority, Declaration Number and Declaration Date, click Next
5. The screen ‘About Declaration’ will open and the declaration details (Import date, destination, etc.) will be auto-filled. Click Next
6. The screen ‘Declaration Details’ will open and the declaration details [e.g. HS (Harmonised System) Code, Import Value, Customs Duty, CIF (Cost, Insurance and Freight) value, etc.] will auto-filled. Click Next
7. As the scenario of import requires an e-guarantee, the VAT Payment screen will verify the e-guarantee number to proceed. Fill in the e-guarantee number and click ‘Verify e-guarantee’ button
8. After the submission of the e-Guarantee is processed successfully, then a confirmation message will appear on the screen giving the transaction ID and the amount. Further, an email confirmation will be received that the e-Guarantee has been successfully submitted. After this, the customs clearance process can be completed.
The FTA made the simple process for submitting an e-guarantee in the FTA portal. The above process must be followed by the entities who have to pay VAT on imports via an e-guarantee in the mentioned scenario.