VAT / Tax Policy

VAT Policy for Terachem

Purpose of the VAT Policy

This document outlines the VAT (Value Added Tax) policy for Terachem, a B2B and B2C chemical e-commerce platform. The policy ensures compliance with applicable VAT regulations, providing transparency in tax calculation and billing for both B2B and B2C customers.

1. VAT Applicability

  • VAT is applicable only for transactions where the billing or delivery country is the UAE.
  • All VAT rates, exemptions, and documentation will be in accordance with UAE VAT laws and regulations.

2. B2C VAT Policy (UAE only)

  • VAT-Inclusive Pricing: All retail (B2C) prices displayed on the website will be VAT-inclusive for customers in the UAE.
  • VAT Rate: The standard VAT rate of 5% will be applied to the retail price for B2C customers.
  • Invoicing: The VAT will be clearly displayed on the order confirmation and invoice, with a breakdown of the VAT amount.
  • VAT Calculation on Checkout: VAT is applied at checkout, ensuring the correct amount is calculated and displayed based on the total purchase.

3. B2B VAT Policy (UAE only)

  • VAT on Invoices: For B2B customers in the UAE, VAT will be clearly displayed on invoices as a separate line item, showing the VAT amount calculated based on the applicable rate (5%).
  • VAT Registration: B2B customers in the UAE must provide a valid VAT Registration Number (VAT TRN) at registration to ensure VAT compliance.
  • VAT Documentation: B2B invoices will include necessary VAT details for reporting and compliance, including VAT breakdown.
  • Tax Exemptions: Some chemical products may be eligible for VAT exemptions or special VAT treatment based on industry-specific regulations, subject to UAE tax authority approval.

4. VAT for International Customers (Outside the UAE)

  • Non-UAE B2C and B2B customers: Prices on the website for customers located outside the UAE will exclude VAT. This ensures compliance with international tax laws.
  • Customs Duties & Taxes: International customers are responsible for any import duties, taxes, or customs fees imposed by their respective countries, and Terachem will not be responsible for these additional costs.
  • Invoicing for International Orders: For B2B customers located outside the UAE, invoices will exclude VAT, and it will be the responsibility of the buyer to manage their local VAT requirements.

5. VAT Calculation Process

  1. Step 1: Determine the customer’s country (billing or delivery address) at the time of checkout.
  2. Step 2: Apply the appropriate VAT rate based on the customer’s location:
    • UAE customers will see VAT included for B2C and itemized for B2B.
    • Non-UAE customers will not be charged VAT.
  3. Step 3: For B2B UAE customers, VAT will be shown on invoices as a separate line item.
  4. Step 4: For B2C UAE customers, the total price shown at checkout will include VAT, with no further breakdown.

6. VAT Invoicing for B2B Customers

  • B2B VAT Breakdown: For B2B UAE customers, invoices will show the total price of the products and the VAT amount as a separate line item, for accurate reporting.
  • B2B Invoice Format: All invoices issued to B2B customers will adhere to UAE VAT invoice requirements, including:
    • The VAT Registration Number (VAT TRN) of Terachem.
    • The VAT amount and rate applied to each item.
    • A clear breakdown of the order value and VAT.

7. VAT on Subscription/Rate Lock Products

  • VAT Application on Subscriptions: The VAT rules will apply to rate lock and subscription orders for UAE customers. For B2C customers, the VAT will be included in the rate lock price. For B2B customers, VAT will be applied separately on invoices.

8. VAT Refunds

  • VAT Refund Process for UAE Customers: If a VAT refund is applicable due to product returns or other adjustments, the VAT refund will be processed based on the original transaction, and the applicable amount will be refunded to the customer’s payment method.
  • Refund Documentation: In the event of a VAT refund, customers will receive a revised invoice reflecting the refund, and the VAT amount will be deducted accordingly.

9. Compliance & Documentation

  • VAT Records: Terachem will maintain all VAT-related records in compliance with UAE VAT laws and ensure that invoices, tax reports, and related documents are available for auditing purposes.
  • Tax Reporting: Terachem will submit VAT returns to the UAE tax authorities in compliance with the regulatory deadlines.
  • Customer Support: For any questions or issues regarding VAT on invoices, please contact our customer support team at support@terachem.com.