Learn the FTA's exact test for a disbursement (out of VAT scope) versus a reimbursement (subject to 5% VAT), the documentation you need, and how misclassifying one leads to under-declared VAT and penalties.
Under Public Clarification VATP013, a disbursement is a payment made purely as an agent on a client's behalf, out of VAT scope. A reimbursement is a cost incurred as principal and recharged, which carries VAT. This guide covers the FTA's five conditions for a disbursement, common UAE examples (government fees, courier costs, recharged expenses), the input tax recovery implications, and what happens when the classification is wrong.
Read the full guide: https://qasproglobal.com/uae-vat-disbursements-vs-reimbursements-2026/
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