Tax Refund for Mosques Construction and Operation in UAE

Tax Refund for Mosques Construction and Operation in UAE means that people can claim a refund of amounts paid as Value Added Tax on inputs that were used in the operation, maintenance, or construction of mosques.

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Legal Factors to Consider

Cabinet Decision No. 82 of 2022, outlines protocols for reclaiming VAT paid for the construction, operation, and upkeep of mosques in the UAE, this decision signifies the UAE’s commitment to bolstering financial assistance to mosques and fostering charitable endeavors. Notably, this decision follows prior measures concerning VAT refunds on residential properties for citizens, as well as VAT refunds for tourists, visitors, and entrepreneurs.

UAE is a country where everything is regulated and monitored under the supervision of the Ministry within its jurisdiction. This includes building and operating mosques. Below are the legal factors involved in building and operating a mosque in the UAE:

• The General Authority for Islamic Affairs and Endowments is responsible for issuing the mosque operating certificate or a local authority concerned with mosque affairs.
• The entity that participates in building a mosque in the UAE is known as the “donor.” The donor can be one or more individuals.
• The operator is the person responsible for managing and maintaining the mosque with written approval from the competent authority.

Terms & Conditions

 If all of the following requirements are met, the donor has the right to request a tax refund for the tax paid for the construction of mosques:

• The donor paid input tax on products or services directly related to the construction of the mosque.
• Proof of the approval of the competent authorities to build the mosque.
• The donor is required to possess a certificate for starting the mosque’s operation.
• The mosque has been delivered or is intended to be delivered by the donor to any other person to whom the competent authority has agreed to deliver the mosque, including the competent authority itself, unless the delivery is a subject supply For tax.
• Proof that the donor manages the mosque by the permission granted to him by the competent authority.
• A document provided by the competent authority containing information about the identity of the donor determined by that authority by that authority.

This decision includes building the mosque, in addition to the actual construction process, equipping it, furnishing it, providing it with the necessary equipment and appliances, maintaining it, and doing everything necessary to carry out all activities.

Procedures

If all conditions are met, the donor may submit a request for a refund of the tax paid for the construction of mosques using a form created by the Authority for this purpose, and the Minister issued an order specifying the application dates.

 If the donor has any construction-related payments that have been withheld, he must pay them once the relevant authority issues the mosque operating certificate.

Once the Authority Receives the Refund Request, it can do the following:

• Verify that the refund request submitted by the operator meets all requirements as directed.
• Determine the amount that can be returned to the operator after verifying the amount of input tax paid by the operator for products or services directly related to the management of the mosque.
• Request information, data, or documents, review them and then confirm the recovery request.
• If the requirements and procedures are not completed, the refund request may be rejected.
• The Authority may, at any time it deems necessary, refer the mosque management’s refund request to the verification authority to examine and review the refund request received from the operator.

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