Latest VAT Changes for Jewellery and Precious Metals 🥇
The UAE brings new VAT law updates for precious metals and jewellery. Have you heard how these new rules can change your business? The government wants to make the UAE a great place for businesses from all over the world. Cabinet Decision No. 127 of 2024 shows the latest steps toward that goal. When the UAE changes VAT rules, the impact reaches not just inside the country but in the global jewellery market, too.
Major VAT Law Updates Affecting Jewellery Businesses
This new VAT law wants to make things simpler for companies registered under VAT. The law helps to increase cash flow and boost fair competition in the precious metals and jewellery sector. Earlier, only gold and diamond deals between VAT-registered businesses used the reverse charge mechanism. The new rule goes further than just gold and diamonds.
Now, the VAT law covers:
- Precious metals: gold, silver, palladium, platinum
- Precious stones: both artificial and natural, like diamonds, rubies, emeralds, pearls, sapphires
- Jewellery: items partly or fully made from these materials
The rule now replaces the old Cabinet Decision No. 25 of 2018, which focused just on gold and diamonds. The net is wider, so more companies must follow the new rules.
According to this law, all deals with these metals or stones must use the reverse charge mechanism. In this way, suppliers who register under VAT don’t need to collect VAT from buyers who are also registered. Instead, the buyer must handle VAT reporting and payment.
Understanding Reverse Charge Mechanism in UAE VAT
Many people get confused when they see the term “reverse charge mechanism.” In a regular sale, the seller adds VAT and sends it to the government. But with the reverse charge, the buyer has to report and pay VAT to the government. Sellers don’t need to send the VAT for these items now.
Reverse charge helps to:
- Stop tax evasion
- Make high-value trades smoother
- Lessen paperwork for sellers
So, it’s smart for every business to know how this rule works.
How Jewellery Companies Can Get Ready for VAT Law
Companies should take action to stay ready for these VAT changes. Businesses should follow some simple steps:
- Review all business agreements: Make sure contracts say who handles VAT.
- Teach your staff: Staff in every department need to know about the new law.
- Update systems: VAT software and invoicing tools should handle reverse charge settings.
- Talk to experts: Speak with Mubarak Al Ketbi Chartered Accountants or reach the Federal Tax Authority for advice.
By following these points, you’ll avoid errors and stay compliant with the law.
Reasons for New Jewellery VAT Law in UAE
Some people get worried when tax rules change. The UAE makes these updates to help businesses run better. The government wants to make business rules simple, increase trust, and help companies move cash quickly.
- These reforms cut out extra paperwork
- Foreign traders find it easier to do business
- The luxury goods market will likely grow over time
The main aim is to attract more investment and make the UAE a top choice for business.
How Mubarak Al Ketbi Chartered Accountants Support You
Mubarak Al Ketbi Chartered Accountants helps businesses stay up-to-date with every new VAT law for precious metals and jewellery. Our expert team helps you avoid mistakes, file returns on time, and keep you ahead of the competition. When it comes to tax law, we believe that “a stitch in time saves nine!”
Reach us for help:
- Expert advice on VAT and tax compliance
- Latest updates for precious metals and jewellery
- Support for avoiding penalties
- Guidance for filing returns on time
For more information:
- Visit our office: Saraya Avenue Building – Office M-06, Block/A, Al Garhoud, Dubai – UAE
- Contact/WhatsApp: +971 50 276 2132
