Case 1 was worth one point and AED 9,000. The right call was to check the new supplier before claiming the VAT on its invoice. But the bigger lesson is what comes after the check. Under the new UAE rules, checking a supplier is not enough on its own. You also need to be able to show that you checked.
This is the first scoreboard of The Quarter, our series of practical VAT decisions. Here is what was at stake, how to score it and what it means for the way a finance team keeps its records.
The scoreboard
| Case 1 | |
|---|---|
| The case | A new supplier, AED 180,000 of laptops, payment requested to another company's bank account |
| The call | Check the supplier and the deal before claiming the input VAT |
| VAT on the line | AED 9,000 |
| Your score | 1 point if you said check first |
Keep your total. Every case in the series is worth one point, and the scorecard at the end of the quarter shows how your instincts compare with the rules.
The rule
FTA Decision No. 13 of 2026, in force since 1 October 2026, sets out the checks a business must make on a supplier and on each supply before deducting input VAT. Case 1 covered what those checks are. This scoreboard is about Article 5, which says how they must be carried out.
Article 5 requires two things that are easy to overlook:
- Documented steps. You must document the verification steps you took. A check that left no trace is hard to rely on if the FTA later asks about a deduction.
- A written policy. You must keep a written policy that names who carries out the checks, who reviews them and who supervises them.
Article 5 also sets the timing: the supplier checks happen on the first dealing with a supplier and again if the supplier has not been verified in the last 12 months, and the supply checks apply to every supply. Article 6 exempts supplies under AED 10,000 excluding VAT, unless your purchases from that supplier exceed AED 100,000 over the previous 12 months or are expected to over the next 12.
So the rules do not only ask whether you checked. They ask whether you can show it, supplier by supplier and invoice by invoice.
A worked example
Take Layla's company over one quarter. Omar, who runs accounts payable, books about 400 supplier invoices. Suppose 12 of them come from suppliers the company has never used before, with an average value of AED 50,000 excluding VAT.
| Item | Amount |
|---|---|
| New-supplier invoices this quarter | 12 |
| Average value excluding VAT | AED 50,000 |
| Input VAT at 5% per invoice | AED 2,500 |
| Input VAT on new suppliers this quarter | AED 30,000 |
Every one of those AED 30,000 deductions depends on the supplier checks having been done and recorded. If the FTA asks about one of these suppliers and the company cannot show what it checked, who checked it and when, the deduction is harder to defend. Case 1 alone accounted for AED 9,000 of that kind of exposure.
The supplier file belongs in onboarding: the incorporation check, the representative's ID, the place of business and any explanation for an unusual payment. The invoice record belongs in the VAT review: what each invoice showed, whether it was a valid tax invoice and whether it matched the books.
How Safa checks this
Writing the policy takes an afternoon. Keeping the record every quarter is the hard part, unless it comes out of work the team already does.
Most teams review purchase invoices before the VAT return anyway. With Safa, that review leaves a record. For every purchase invoice, Safa checks that it is a proper tax invoice, shows the supplier's and the buyer's tax registration numbers (TRNs), adds up, and matches what was booked in your ERP's VAT export. Each invoice gets a verdict and a plain-language reason. In the web app, your team can mark each invoice as reviewed and add its own notes, and you can export the verdicts and reasons to Excel.
The supplier checks themselves stay with your team. Safa does not verify identity, premises or bank details, so the supplier file stays with your onboarding process while the invoice record builds up as you work.
What it means for your business
The cost of Case 1 was AED 9,000 if the supplier turned out to be part of a fraud and the checks had been skipped. The cost of the record is lower but ongoing: every new supplier, every quarter.
Three steps to put this in place:
- Write the Article 5 policy. Name who checks suppliers, who reviews the checks and who supervises them, and say where the evidence is kept.
- Keep one supplier file per supplier, with the date of the last check, so you know when the 12-month re-check is due.
- Keep the invoice-level record with the VAT return for each period, so the document side of every deduction can be shown on request.
Next in The Quarter: Case 2, a Spot the Leak, lands a few days before Layla's filing deadline.