The UAE Federal Tax Authority (FTA) has approved a total of 30,920 applications for Value Added Tax (VAT) refunds worth a collective AED2.54 billion ($691.53 million), submitted by Emirati citizens for taxes incurred on building new residences. This covers the period since the service was launched and until the end of the first half of 2024.
In comparison, by the end of the first half of 2023, the total number of approved applications amounted to 23,340, with a total value of AED1.54 billion ($419.27 million). This marks a 32.45 percent increase in the number of approved applications and a 65.07 percent increase in the value of refunded amounts over a 12-month period.
Tax refunds for new home construction
In a recent press statement, the Authority explained that in the year between the end of June 2023 and the end of June 2024, 7,580 new applications were approved, allowing citizens to reclaim over AED1 billion in taxes paid on building new homes. During the first six months of 2024, 3,590 new applications were approved, refunding AED336.09 million in taxes.
Khalid Ali Al Bustani, director-general of the FTA, stated that these enhancements include introducing more facilities to streamline and expedite the refund process for UAE citizens who meet the legal requirements for tax refunds. He further added that this initiative is aligned with the FTA’s strategy to prioritize citizens’ happiness, as per the wise leadership’s vision to establish and enhance a modern housing system for Emirati citizens and provide them with the highest living standards.
Steady rise in approved applications
Statistics from the Federal Tax Authority reveal a notable increase in the number and total value of approved applications since the service was first offered to UAE citizens. The number of approved applications rose from 270 requests worth AED9.11 million in 2018 to 1,900 applications worth AED121.46 million in 2019.
The number grew further to 3,750 applications valued at AED301.35 million in 2020, marking a significant 97.16 percent increase in the number of approved applications and a 148.1 percent uptick in refunded VAT amounts. This upward trend continued, with 5,990 applications worth AED467.52 million approved in 2021, indicating an annual growth of 59.62 percent in the number of approved applications and 55.14 percent in refunded VAT amounts.
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Moreover, in 2022, the number of approved applications rose to 7,170 requests worth AED583.38 million, revealing a growth of 19.61 percent in the number of approved applications and 24.78 percent in refunded VAT amounts. Figures for 2023 indicated continued growth, with a total of 8,250 applications worth AED720.12 million approved, marking a 15.06 percent annual growth in approved requests and 23.44 percent in refunded VAT amounts.
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