vat

Clarified: VAT for health, education sectors

As part of 'Know Your Rights' campaign, the Federal Tax Authority releases explainer on exemptions and taxable items in the health and education sectors

Gulf News Web Report
19:18 January 9, 2018
Students

DUBAI: The UAE Federal Tax Authority (FTA) has released on Tuesday a simplified explainer on the conditions under which the value-added tax (VAT) will be applicable to the health and education sectors.

It lists down items that have zero VAT, those that are VAT-exempt and those that are not.

The UAE introduced a value-added tax from January 1, 2018.

Education

In the education sector, there are five items that have zero VAT.

These include (1) nursery education and pre-school education, (2) school education, (3) higher education provided by institutions owned by the government or getting more than 50 per of their funding from government, (4) printed and digital reading material provided by the education institution and (5) school trips related to curriculum.

School transport is VAT exempt, according to the authority.

A 5-per cent VAT applies to school uniforms, electronic equipment, food and beverages on campus, school trips for recreation and extra-curricular activities.

The UAE has adopted a 5 per cent VAT which kicked in on January 1, 2018.

Healthcare

In the healthcare sector, services that have zero VAT include preventive healthcare and treatment (provided by a healthcare institution, physician, nurse, dentist or pharmacy licensed by the Ministry of Health and Prevention, MOHAP), or the competent authority).

Also VAT-exempt are medications registered or approved by the MOHAP.

Medical equipment registered or approved by the ministry.

A 5 per cent VAT applies to medications that are not registered or approved by the MOHAP and other healthcare services that are not for treatment and are not preventive.