New FTA Rules: Verify Your Suppliers Before Recovering Input VAT from 1 October 2026
The Federal Tax Authority (FTA) has issued Decision No. 13 of 2026. It sets out the checks VAT-registered businesses must carry out on suppliers and supplies before deducting input tax. The Decision was issued on 22 July 2026, published on the FTA website on 20 August 2026, and takes effect on 1 October 2026.
Why this matters
Article 54 (bis) of the VAT Law allows the FTA to reject input tax where a business knew, or should have known, that a supply was connected to tax evasion. Decision No. 13 sets out what reasonable checks look like. From 1 October, holding a valid tax invoice and supplier TRN may not be enough on its own.
What businesses need to do
- Verify suppliers when dealing with a supplier for the first time, or where the supplier has not been verified in the previous 12 months.
- Assess each supply before recovering the input tax on it.
- Document the checks performed and keep supporting records.
- Apply the value thresholds in the Decision, which determine when certain checks apply.
Practical steps before 1 October
- Review supplier onboarding and procurement processes
- Identify high-value and higher-risk suppliers
- Prepare a written internal verification policy
- Brief finance and procurement teams
In an FTA audit, the question will be what was checked, when and by whom.
Official source: Federal Tax Authority - FTA Decision No. 13 of 2026