A VAT registered owner of the goods may request another VAT registered person (“importing agent”) to import goods on behalf of the former. This will happen when the person importing the goods is, for example, an agent of the owner of the goods, or in some cases, the customer of the owner of the goods. The VAT registered importing agent would have provided their TRN at the time of importation of the goods; the VAT amount would be automatically pre-populated in Box 6 of the VAT Return of the importing agent.

This Public Clarification No.: VATP012 discusses the adjustments that should be made in the VAT returns of the importing agent on one hand and the owner of the goods on the other hand and also who can recover the import VAT.

The VAT registered importing agent who acts as the importer of record would be required to make a negative adjustment in Box 7 of the VAT Return, in order to nullify the amount pre-populated in Box 6 of the VAT Return.

The owner of the goods would be entitled to recover the import VAT as per its normal VAT recovery position.

The owner and the importing agent need to agree in writing to make the adjustments stated in the preceding paragraphs. Furthermore, both parties will need to retain the evidence of this written agreement as records, in addition to any other required records, including customs documentation.

However, it may also be done where the owner and the importing agent do not wish to make the adjustments stated in the preceding paragraphs; the importing agent may issue a statement to the owner as prescribed in Article 50(7) of the Executive Regulations. The statement will be considered as a Tax invoice for the purpose of recovering input tax by the owner and can be recovered via Box 9 of the tax return.