A Designated zone in UAE is one among the areas which are treated as outside the state of the UAE for VAT purposes, where VAT is not applicable on supply of goods.
There are certain conditions that must be satisfied as a designated zone, the operator must obey the procedures set by the authority, entry and exit of individuals and goods must be under proper custom control and security measures, there must be internal procedures within the zone for keeping, storing and processing the goods and moreover it should be a fenced geographical area.
In order to make a VAT free supply of goods, make sure that the goods are not released, altered or used while transferring from one designated zone to another. Also follow the rules under customs suspension mentioned under the GCC Common Customs Law while transferring goods.
Situations under which VAT will be applicable in designated zones are:
- Transfer of goods from the designated zones to mainland and vice-versa
- Supply of water and all other forms of energy
- Self-consumed or third person used goods
VAT is not applicable if:
- Goods are transferred between designated zones
- Transfer of goods is from a designated zone to overseas/GCC countries and vice-versa
- Goods are incorporated, attached or forms part of other goods
- Goods are being used in the production or sale of other goods within the designated zone.
List of designated zones:
Abu Dhabi
Free Trade Zone of Khalifa Port
Abu Dhabi Airport Free Zone
Khalifa Industrial Zone
Dubai
Jebel Ali Free Zone (North-South)
Dubai Cars and Automotive Zone (DUCAMZ)
Dubai Textile City
Free Zone Area in Al Quoz
Free Zone Area in Al Qusais
Dubai Aviation City
Dubai Airport Free Zone
Sharjah
Hamriyah Free Zone
Sharjah Airport International Free Zone
Ajman
Ajman Free Zone
Umm Al Quwain
Umm Al Quwain Free Trade Zone in Ahmed Bin Rashid Port
Umm Al Quwain Free Trade Zone on Sheikh Monhammed Bin Zayed Road
Ras Al Khaimah
RAK Free Trade Zone
RAK Maritime City Free Zone
RAK Airport Free Zone
Fujairah
Fujairah Free Zone
FOIZ (Fujairah Oil Industry Zone)
If you have any doubt regarding designated zones call us on 00971-4-331-2332