What are the recent clarification issued on Profit Margin Scheme?
Profit Margin Scheme: Only those goods which have previously been subject to VAT before the supply may be subject to the profit margin scheme. As a result, stock on hand of used goods which were acquired prior to the effective date of Federal Decree-Law No. (8) on Value Added Tax (“VAT law”), or which have not previously been subject to VAT for other reasons, are not eligible to be sold under the profit margin scheme.
VAT is therefore due on the full selling price of such goods.