The Challenge
Our client’s business model involved acquiring commercial properties and reselling them — a sector where VAT can swing significantly in either direction depending on timing and treatment.
During the period in question, the company had acquired high-value commercial assets, paying 5% input VAT on those purchases along with substantial VAT on related transaction costs such as brokerage, legal, and due diligence fees. Because these acquisitions outpaced their taxable sales within the same periods, the company sat on a large net recoverable VAT position. The problem: earlier filings had been conservative and incomplete, significant input VAT had gone unclaimed, and the client feared that a refund of this size would draw intense FTA scrutiny they weren’t prepared for.
Our Approach
We treated the engagement as both a recovery exercise and a compliance clean-up, building a claim robust enough to withstand any level of FTA review:
- Confirmed the VAT treatment of every transaction — verifying that the commercial property purchases and sales were correctly standard-rated, establishing a valid basis for input VAT recovery.
- Reconstructed and reconciled input VAT — working line by line through purchase agreements, supplier invoices, and transaction-cost bills to ensure each claimed amount was supported by a valid tax invoice and correctly recorded.
- Corrected and refiled where needed — capturing the under-claimed input VAT from prior periods so the full recoverable amount was accurately reflected in the returns.
- Prepared a complete, audit-ready file — assembling schedules, reconciliations, and supporting evidence in the exact format the FTA expects for a refund of this magnitude.
The Result
The FTA approved the claim in full, releasing a VAT refund of AED 2.8 million to the client. Because every figure was backed by clean documentation and correct treatment, the Authority’s review raised no adverse findings — the refund was processed without dispute or penalty. Beyond the cash recovered, the client gained fully compliant records and a clear framework for managing VAT correctly on every future deal.
The Takeaway
“A refund of this size isn't won by chance — it's won through accurate accounting, correct VAT treatment, and documentation strong enough to stand up to scrutiny. That's precisely the discipline we bring to every engagement.
