Until now, a valid tax invoice from a registered supplier was usually enough to recover input VAT in the UAE. From 1 October 2026, it is not.
Since 1 January 2026, the VAT Law has allowed the FTA to deny input tax when a supply is linked to tax evasion and the buyer knew or should have known. FTA Decision No. 13 of 2026 now spells out what "should have known" means in practice: a set of checks on suppliers and on individual supplies that you must carry out, and document, before you deduct the VAT.
Checks on the supplier
You must verify a supplier the first time you deal with it, and again if it has not been verified in the previous 12 months.
If the supplier is a company or other legal person:
- Confirm it is incorporated, through official databases or its certificate of incorporation
- Verify the identity of the director, agent or employee you deal with, and keep a copy of their ID
- Verify its actual place of business, online or by a site visit
If the supplier is an individual: keep a copy of a valid Emirates ID or passport and meet them, in person or virtually, before the supply.
Risk indicators to assess: for example, a supplier that changed its address or key staff more than twice in 12 months, or whose transactions look out of proportion to its size and history. If an indicator is present, you need a clear written explanation on file.
Above AED 375,000 a year: if your supplies from one supplier exceed, or are expected to exceed, AED 375,000 over 12 months, you also need evidence that it holds a UAE bank account and a review of public information about its reputation.
Checks on each supply
Before deducting input VAT on a purchase, check:
- The commercial reason for the purchase and the supplier's role in it
- The payment method and flow. Cash, payments to third parties and payments to accounts outside the supplier's country need a justification
- That the price is reasonable compared with the market
- That the goods or services fall within the supplier's licensed and normal business
- The ownership and origin of the goods
- If the supplier is an intermediary, that there is a real commercial reason for its role
The small-purchase exception
Supplies below AED 10,000 (excluding VAT) can be exempt from these checks, subject to conditions. The exception does not apply to a supplier whose supplies to you exceed, or are expected to exceed, AED 100,000 over 12 months.
You need a written policy
Every business must keep a written policy naming who implements, reviews and supervises the verification procedures, and what each of them is responsible for. It is not filed with the FTA, but it must be available if the FTA asks.
What to do now
- Write the policy and name the owners in finance and procurement.
- List your suppliers by annual spend to see who is above AED 10,000, AED 100,000 and AED 375,000.
- Verify your largest suppliers first, then set a 12-month review cycle.
- Add supply-level checks to your purchase approval, so they happen before payment, not at VAT return time.
- Keep the evidence with each supplier and purchase. Without it, you may not be able to defend the input VAT in an audit.
How Dreambooks helps
Dreambooks keeps trade licences, IDs and verification notes on each supplier record, reminds you when the 12-month check is due, and shows your spend per supplier against the AED 100,000 and AED 375,000 thresholds, so the evidence is ready if the FTA asks.
Official sources
- FTA Decision No. 13 of 2026 on verifying the validity and integrity of supplies
- Ministry of Finance: VAT Law amendments from January 2026
- FTA: VAT legislation
This article is general information as of September 2026, not tax advice. Check FTA Decision No. 13 of 2026 and the latest FTA guidance, or speak to your tax adviser, before acting.