The VAT Consultant, a leading FTA-approved tax advisory firm in Dubai, is urging UAE businesses to review and reclaim unused VAT credits before the transitional relief window closes on 31 December 2026.

A New, Non-Extendable Deadline for Legacy VAT Credits
Under Federal Decree-Law No. 16 of 2025, the UAE introduced a five-year limitation period for excess input VAT credits, effective 1 January 2026. Businesses can no longer carry forward unused VAT balances indefinitely.

A one-time transitional relief window now applies to legacy credits, particularly those from the 2018-2021 tax periods. Once 31 December 2026 passes, any unclaimed balances will be permanently forfeited.

Why This Deadline Matters Now
Many businesses accumulated dormant VAT credits over the years, assuming they could be carried forward indefinitely. That assumption no longer holds.

Credits from 2018-2020 tax periods must be claimed by 31 December 2026
Credits from later periods follow a rolling five-year expiry from the end of their tax period
Claims filed in the final year may face increased FTA audit scrutiny
Once expired, credits cannot be recovered under any circumstances

How The VAT Consultant Is Helping Businesses Prepare
With 19+ years of UAE tax experience and a team serving over 18,000 businesses, The VAT Consultant is guiding clients through a structured recovery process.

EmaraTax Record Review: Identifying unclaimed or dormant VAT credit balances
Refund Application Support: Preparing and submitting VAT311 refund requests accurately
Supplier Compliance Checks: Verifying supplier records to avoid claim rejection under the new input VAT rules
FTA Query Management: Handling clarification requests to prevent missed deadlines

Act Before the Window Closes
Businesses that delay risk permanent loss of recoverable funds, with no further extension expected once the transitional window closes.

The VAT Consultant recommends all VAT-registered businesses review their historic records now, rather than waiting until the final quarter of 2026.

Businesses can contact The VAT Consultant for a free consultation to assess unclaimed VAT credits before the 31 December 2026 deadline.

Visit us: https://thevatconsultant.com/