VAT in the United Arab Emirates

From 2018 onwards, doing business in the UAE includes dealing with VAT.

Value Added Tax (VAT)

Like the Netherlands, VAT is charged at each and every step of the supply chain, which ultimately ends up to the consumer paying VAT. The standard rate is equal to 5%.

Collection of VAT

Businesses (supplies, retailers, etc.) will be responsible for documenting their business income and costs carefully along with the VAT charges. The registered businesses will charge VAT to their consumers on the goods or services they purchase from their suppliers.

Steps to take and responsibilities for business in the UAE

Businesses above the threshold of AED 375,000 are required to get registered for VAT. These companies must charge VAT on all the taxable goods and services they provide and can reclaim any VAT they’ve paid on goods and services. In addition, the companies are required to keep proper accounting records.

More information about VAT in the UAE

The Federal Tax Authority (FTA) introduced a website devoted to the VAT-system. Businesses can find information and register at this online portal.

For additional information, please consult the useful guidelines of the FTA, our ‘Doing business in the UAE’ brochure or contact the Economic Department of the Embassy in Abu Dhabi or the Consulate General in Dubai.