English translation published by the Legislation and Legal Opinion Commission. The Arabic text published in the Official Gazette remains the legal reference in the event of any discrepancy.
The value may be reduced by price discounts, State subsidies to the supplier and amounts paid by the supplier in the customer's name and for the customer's account. Input Tax on the last category cannot be deducted by the supplier.
Pricing, sales and accounting teams managing discounts and customer disbursements.
Not every commercial deduction or recharged amount reduces the VAT base. Nature, timing and the capacity in which the supplier paid the amount must be established.
Current text
Before reducing the value
- 1
Identify the reduction, reason and timing.
- 2
Distinguish a discount at Supply from a later value adjustment.
- 3
For a customer disbursement, prove payment was in the customer's name and for its account.
- 4
Do not deduct Input Tax on an amount treated as that disbursement.
Connected provisions
Regulations — Article (29)
Value after reductionIt distinguishes reductions at and after Supply and confirms that State subsidies include those granted by government entities.
Open connected ArticleLaw — Article (28)
Adjustment of valueIt applies where the reduction occurs after Supply and requires an adjustment and correction document.
Open connected ArticleOfficial guides and tools
Discount documented at sale
A genuine documented discount granted at the time of Supply is tested under this Article. A later discount follows the value-adjustment and correction-document route.
Questions to help you apply it
- Is the reduction genuine and evidenced?
- Did it arise at or after Supply?
- Was an amount paid in the customer's name and for its account without an Input Tax claim?