Reference Guide
From 1 October 2026, UAE businesses must be able to show they checked a supplier before claiming input VAT on what that supplier billed them. This guide sets out what the Federal Tax Authority (FTA) expects, and what to put in place before the deadline.
If your VAT claim is challenged without documented checks in place, the FTA can deny the input tax recovery. Speak to an Aurum consultant about setting up a verification process before the deadline. Supplier verification is part of our Tax & Compliance service.
Last reviewed: September 2026 Effective 1 October 2026Jump to Section
Section 01
FTA Decision No. 13 of 2026 sets out the measures, procedures and conditions taxable persons must follow to verify the validity and integrity of their supplies. It was issued on 18 August 2026 and takes effect on 1 October 2026.
In practice, it moves input VAT recovery beyond holding a valid tax invoice. The decision implements Article 54(bis) of the VAT Law, which allows the FTA to deny recovery where a supply is connected to tax evasion and the recipient business knew, or should reasonably have known, about it. Supplier verification is how a business shows it did not, and a documented trail is what separates a genuine transaction from one that draws questions in a review.
Businesses are expected to establish that:
In Effect From
Verification processes need to be in place by this date for suppliers and supplies you intend to claim input VAT on. The decision was issued on 18 August 2026, giving roughly six weeks' notice.
Not a One-Off Task
Verification is expected at first engagement with a supplier and then on an ongoing basis, generally understood as at least once every 12 months, particularly where the relationship continues or circumstances change. It sits alongside your existing procurement and VAT filing routines.
The Chain You Need to Evidence
Each link should be backed by a document you can put in front of the FTA. A missing link is usually where a review starts asking questions.
Section 02
The verification path differs depending on whether your supplier is an individual or a company. Both need to be confirmed before you rely on their invoices for input VAT.
Obtain identification documents, such as an Emirates ID or passport. Meet the supplier in person or virtually, and keep a record of that interaction.
Verify incorporation details and regulatory standing, and confirm the identity of the individuals authorised to act for the company. Keep the supporting documents on file.
Confirm the supplier has a genuine business location, whether through an electronic check or a site visit, and that it matches the activity they are invoicing you for.
Section 03
Not every supplier needs the same depth of checking. The decision scales the expected effort to the value of what you buy from them.
Thresholds That Apply
| Threshold | What It Means |
|---|---|
| AED 10,000 | Individual supplies below this value, excluding VAT, can generally be treated as exempt from full verification. |
| AED 100,000 | Once your total supplies from one supplier reach, or are expected to reach, this amount in any 12 month period, the small-supply exemption no longer applies. Full verification is expected regardless of individual invoice size. |
| AED 375,000 | Above this annual amount from one supplier, verification extends to a bank account confirmation and a reputation review, in addition to the standard checks. |
Not sure which of your suppliers cross these thresholds?
Speak to Aurum →Section 04
Verifying the supplier is one part of this. The other is checking that the specific transaction stands up on its own terms.
Tax Invoice
Confirm the invoice contains the required VAT information and matches the supplier's registered details, including their TRN and legal name.
Proof of Supply
Keep contracts, purchase orders, delivery notes, service records and payment evidence. An invoice records the charge. These documents show the goods or services genuinely changed hands.
Pricing should be broadly consistent with market rates, and payment terms should make commercial sense. Prefer traceable payment methods. A cash payment is not prohibited, but it calls for a documented reason.
What you are buying should fall within the supplier's licensed and ordinary business activity. A construction firm invoicing for IT consultancy is a mismatch worth documenting an explanation for, not ignoring.
For goods, keep evidence of origin and the supplier's ownership or right to sell them. Where a supplier is acting as an intermediary, keep a note of the commercial reason for that arrangement.
Section 05
None of the points below mean a supplier is doing anything wrong. They are signals worth a documented second look, so that if a question comes up later, you already have an answer on file.
What to Do With a Flag
Where a risk indicator applies, write down why you proceeded anyway, if you did. A short, dated note from whoever approved the transaction is more useful during a review than a verbal recollection months later.
Section 06
Most of this is process, not paperwork you create from scratch. It is about making sure what you already hold on your suppliers is complete, current and in one place.
Identify which suppliers already exceed, or are on track to exceed, the thresholds in Section 03.
Collect or update identity documents, incorporation certificates and TRN verification for the suppliers that need it.
Check that registered addresses match where the supplier actually operates, and note how each check was done.
Look at cash payments and third-party arrangements in particular, and record the commercial reason for each.
Put the verification process in writing, and name who in the business is responsible for it and where the records are kept.
Make sure procurement and accounts payable understand the new checks, since they are usually the first to deal with a new supplier.
Common Questions