On 4 june 2020, the UAE Cabinet issued a Cabinet Decision (No. 46 of 2020) to amend Clause (2) of Article 31 of the Cabinet Decision No. 52 of 2017

Clause (2) of Article 31 was originally written as follows:

For the purpose of paragraph (a) of Clause (1) of this Article, an individual will be considered as being ‘outside the State’ on the off chance that they only have a short-term presence in the State of less than a month, or the only presence they have in the State is not adequately connected with the supply”.

This has been amended to:

For the purpose of paragraph (a) of Clause (1) of this Article, an individual shall be be “For the purpose of paragraph (a) of Clause 1 of this Article, a Person will be considered as being ‘outside the State’ if they just have a short-term presence in the State of less than a month and the presence isn't effectively connected with the supply”.

After consolidating the two conditions the scope of zero-rating export of services is limited. Therefore, zero-rating the export of services will not be applied where the non-resident recipient:

  • Stays in the UAE for a month or more; or

stays in the UAE for less than a month but his presence in the UAE is successfully connected with the supply.

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