If your VAT account holds unused credit from the early years of UAE VAT, the window to claim it closes on 31 December 2026. After that date the right to a refund, or to use the credit against what you owe, is lost for good. The rule is new, it came into force on 1 January 2026, and many businesses with a credit balance have not heard of it.
What changed on 1 January 2026
Federal Decree-Law No. 16 of 2025 amended the VAT Law, and Federal Decree-Law No. 17 of 2025 amended the Tax Procedures Law. Both took effect on 1 January 2026.
Before this, excess input VAT could sit on your EmaraTax account for years and still be refunded or used later. Now it can only be carried forward or refunded within five years of the end of the tax period it arose in (VAT Law, Article 74(3)). When the five years end, the right ends too. Refund requests for credit balances follow the same limit (Tax Procedures Law, Article 38). Andersen notes that the five-year limit also applies to refund claims under the Excise Tax Law.
Credits build up where input VAT regularly beats output VAT. That often means exporters and other zero-rated sellers, start-ups that buy equipment before they sell, and businesses with large capital spending.
Which tax periods have until 31 December 2026
The law gives a one-time relief for older credits. If the five years from the end of your tax period have already passed, or will pass within one year of 1 January 2026, you can still apply until 31 December 2026.
| Tax period ended | Five years end | Last day to apply |
|---|---|---|
| 31 December 2019 | 31 December 2024 | 31 December 2026 |
| 31 December 2020 | 31 December 2025 | 31 December 2026 |
| 31 March 2021 | 31 March 2026 | 31 December 2026 |
| 31 December 2021 | 31 December 2026 | 31 December 2026 |
| 31 March 2022 | 31 March 2027 | 31 March 2027 |
| 31 December 2022 | 31 December 2027 | 31 December 2027 |
This table is our reading of the law’s wording, so treat it with care. Andersen describes the relief as mainly for tax periods from 2018 to 2020, and some firms call 2021 unclear. The wording covers any period whose five years end by 31 December 2026, and that includes 2021. Andersen also notes that the amended law requires the FTA to issue formal guidance on how these rules apply. Check for that guidance, and if you hold 2021 credits, file rather than wait.
What you must do by 31 December
You must submit the request. The transitional wording says a taxpayer can apply to the FTA for a refund of the credit balance, or use it to pay tax liabilities or administrative penalties, as long as the request is submitted within one year of 1 January 2026. The deadline is about filing, not about when the money arrives.
The second option matters if you already owe the FTA something. An old credit that would otherwise expire can be set against tax or penalties you owe now. See our guide to VAT penalties for what those can add up to.
How to find your old credits
This is where most businesses get stuck, because a credit balance is easy to ignore once it has been sitting there for years.
- Log in to EmaraTax and go through your VAT return history from 2018. Note every tax period where input VAT was higher than output VAT.
- Compare your VAT control account in the ledger with the balance on EmaraTax. If they do not match, find out why before you file. Our guide to account reconciliation explains how.
- Work out which tax period each credit came from. The five years run from the period the credit arose in, not from today.
- Check which records you still hold for each period. VAT records must be kept for five years, so papers for the oldest periods may already be gone.
- Check the suppliers behind the claim. You need valid tax invoices that show the supplier’s TRN and the VAT amount.
Exporters have extra paperwork to find. Zero-rated sales need customs and export evidence on file, covered in our guide to VAT on exports.
Filing the refund request
Refund requests for registered businesses go through EmaraTax on Form VAT311. The relevant VAT return must already be filed, which it will be for old periods. The usual attachments are:
- the FTA refund template, listing each transaction
- tax invoices showing the supplier’s TRN and VAT amount
- proof of payment, such as bank statements
- an IBAN validation letter for the account that will receive the money
- customs and export documents, for zero-rated supplies
Firms disagree on timing. Two sources say the FTA’s own refund page, updated in April 2026, lists an estimated 25 business days from a complete application. Older guides say 20. First-time claims often take longer, because the FTA may ask for sample invoices, bank statements and a reconciliation of the refund balance. Since the deadline is for filing, start early, and do not wait for December.
What can go wrong after you apply
- An audit of the claim. The FTA can audit or assess a refund claim for up to two years after the request, even when that goes past the five-year limit. A claim filed in the fifth year gets the same extra two years.
- Voluntary disclosure. If the FTA has not yet decided your request, you can file a voluntary disclosure within two years of submitting it.
- Supplier checks. Input VAT can be refused where a supply was part of an evasion chain and you knew, or should have known, about it. Baker McKenzie notes that failing to verify a supply properly can be treated as knowing. Keep proof that you checked your suppliers.
- Missing records. A claim you cannot support is a weak claim.
None of this is a reason to skip the claim. It is a reason to check your support before you file. Our guide to a VAT audit covers how to prepare.
Credits from 2022 onwards
The relief only helps older credits. Each later tax period has its own five years and no extra time. A credit that arose in the quarter ended 31 March 2022 expires on 31 March 2027. Once a year, list your credit balance by tax period and either claim it or use it.
Special, shorter timing rules apply to credits that arise late, for example from an FTA decision or a voluntary disclosure close to the end of the five years. If that is you, get advice before you wait.
If you are buying a business, ask whether its VAT credits are still valid. Our due diligence checklist includes this check.
A plan for the weeks before the deadline
- Pull your VAT return history from 2018 and list every period that ended in credit.
- Reconcile your VAT control account to EmaraTax.
- Sort the credits by tax period using the table above.
- Check which documents you still have for each period.
- File the refund request, or apply the credit to what you owe, for every period ending on or before 31 December 2021.
- Diary the 2022 periods.
If you want help finding old credits or preparing the claim, you can read our guide to VAT refunds or contact our team.
Baker McKenzie’s summary sets out the amended articles: UAE VAT and Tax Procedures Law amendments.
Frequently Asked Questions
What is the UAE VAT refund deadline for 2026? 31 December 2026 for unused VAT credits whose five-year period has already ended, or ends by that date. Later credits follow their own five-year period.
Which tax periods are covered by the 31 December 2026 deadline? On our reading of the law, any period that ended on or before 31 December 2021. Some firms only mention 2018 to 2020, so confirm 2021 periods with an adviser or the FTA’s guidance.
Do I lose the credit if the FTA has not paid by 31 December? The transitional wording refers to submitting the request within the period. A decision can take weeks, so submit well before the deadline.
Can I use an old credit to pay tax or penalties instead of taking a refund? Yes. The transitional provision allows the credit to be used to pay tax liabilities or administrative penalties, as long as the request is submitted in time.
Does the five-year limit apply to credits I earn from now on? Yes. Excess input VAT must be refunded or used within five years of the end of the tax period it arose in.
Does this affect excise tax? Andersen reports that the same five-year limit applies to refund claims under the Excise Tax Law.
