Time of supply: what it means in UAE tax.
The meaning of time of supply under UAE VAT law: how it works, a worked example in AED, common mistakes and the legal references.
The time of supply is the date UAE VAT becomes due on a sale, usually the earliest of delivery, completion, payment or invoice.
What time of supply means
Also called: Date of supply, Tax point.
The time of supply, called the date of supply in the UAE VAT law, is the date on which VAT on a supply is calculated and becomes due. It decides which tax period the output tax belongs to, and it starts the 14 day clock for issuing a tax invoice.
For most goods and services it is the earliest of several events: the goods are delivered or made available, installation is completed, the service is completed, payment is received, or the tax invoice is issued. So a deposit or an early invoice can pull VAT into an earlier period than the delivery itself. Where VAT is triggered by a payment or an invoice, it is due only to the extent of that payment or invoiced amount.
Contracts with periodic payments, such as retainers and leases, have their own rule. For SMEs that take deposits or bill in stages, getting the date wrong is one of the most common causes of late VAT.
How it works
- For a one-off supply, take the earliest of transfer or availability of goods, completion of assembly or installation, completion of services, receipt of payment, or issue of the tax invoice.
- A deposit or advance payment creates a date of supply for the amount received, so VAT on it is due in that tax period.
- For contracts with periodic payments or consecutive invoices, use the earliest of the invoice date, the payment due date shown on the invoice, the payment date, or one year after the goods or services were provided.
- For vending machines, the date of supply is when money is collected from the machine.
- Goods sent on a returnable basis are supplied when the customer accepts them, or 12 months after they were sent, if earlier.
Worked example
A kitchen fit-out company agrees a job worth AED 100,000 before VAT. The customer pays a 20% deposit on 25 June, and installation is completed on 10 July. The company files quarterly returns ending on 30 June and 30 September.
| Total price including VAT | AED 105,000 |
| Deposit received 25 June (including VAT) | AED 21,000 |
| VAT in the deposit, due in the quarter to 30 June | AED 1,000 |
| Balance on completion 10 July (including VAT) | AED 84,000 |
| VAT in the balance, due in the quarter to 30 September | AED 4,000 |
The deposit pulls part of the VAT into the earlier quarter, even though the work was finished later.
Common mistakes
- Declaring VAT only on delivery and ignoring deposits received in an earlier quarter.
- Waiting for the customer to pay before accounting for VAT on an invoice already issued.
- Not applying the one year rule to long-running contracts with no invoice or payment.
The law
- Federal Decree-Law No. 8 of 2017 on Value Added Tax, Articles 25 and 26, and Article 67 (tax invoice within 14 days of the date of supply)
- Cabinet Decision No. 52 of 2017 (Executive Regulation of the VAT law), Article 19
Frequently asked questions
If I issue a proforma invoice, does that create a date of supply?
The rule refers to issuing the tax invoice. A proforma that is not a tax invoice does not in itself trigger the date of supply, but receiving payment against it does.
When is VAT due on a deemed supply?
On the date of the supply, disposal, change of use or deregistration, whichever applies.
Related terms
Output tax · Tax invoice · Deemed supply · VAT tax period. See every term in the UAE tax glossary.
For the full picture, read our guide: UAE VAT Filing Calendar 2026: Every Quarterly Deadline.
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