UAE Federal Tax Authority Mandates Supplier Verification for Input VAT Deductions

The UAE Federal Tax Authority (FTA) has issued Decision No. 13 of 2026, establishing mandatory supplier verification procedures that taxable entities must fulfill before claiming input VAT deductions. Under the new requirements, taxpayers are no longer permitted to rely solely on holding a valid tax invoice to substantiate deduction claims.

According to the regulation, businesses must verify key supplier information, including official incorporation details, authorized directors, and physical operating premises. Companies are also required to document a genuine commercial rationale for every transaction in order to prevent fraud and illicit supply chain arrangements.

The regulatory framework introduces specific expenditure thresholds. Supplies below AED 10,000 are subject to exemptions, though these exemptions phase out once annual purchases from a single vendor surpass AED 100,000. For transactions exceeding AED 375,000, elevated verification checks are required.

Industry experts cited by Consultancy-me.com stated that businesses must adjust their procurement onboarding procedures, vendor compliance frameworks, and internal accounting controls to ensure input VAT deductions are not blocked.