9 September 2026 · Customer Side
The Customer's Input-Tax Obligation
VAT bad debt relief is symmetrical. If a customer recovered input VAT on a supplier's invoice but never paid it, then once the supplier notifies the customer of the write-off, the customer must reduce its own recoverable input tax by the same VAT amount. This prevents the customer keeping input VAT it never funded, and it is why the supplier's notification condition exists.
Exiloz Management & Tax Consultant · Dubai-based FTA-focused advisory · VAT, corporate tax & accounting
Give back what you did not fund
The customer's side of the relief.
- Customer had recovered input VAT.
- It never paid the supplier.
- On notification, it reverses that input VAT.
- By the same amount as the relief.
The system balances
Relief is not a windfall.
- Supplier reclaims output VAT.
- Customer repays the input VAT.
- The FTA is kept whole.
- Notification links the two sides.
Related guides
Frequently Asked Questions
For customers with unpaid supplier invoices.
Do I repay input VAT if I did not pay my supplier?
Yes. If you recovered input VAT and are notified of the write-off, you must reduce your recoverable input tax by that amount.
What triggers my obligation?
The supplier's notification to you of the amount written off.
How much do I reverse?
The same VAT amount the supplier claims as bad debt relief.
Can Exiloz manage both sides?
Yes. We handle the supplier claim and the customer adjustment correctly.
Get the customer side right
Exiloz handles both the supplier claim and the customer's input-tax reversal.