Quick Information:

  • Introduced on 01 January 2018

  • Rate of VAT: 5%

  • Registration under VAT required when taxable supplies exceeds AED 375,000 per annum

  • VAT applies equally on tax-registered businesses managed on the UAE mainland and in the free zones.

  • At the end of each tax period, VAT registered businesses or the ‘taxable persons’ must submit a ‘VAT return’ to Federal Tax Authority

  • You must file for tax return electronically through the FTA portal:


Basics of VAT

VAT = Value Added Tax

VAT only applies to the value being added by any business. Thus, the business is required to pay the VAT only on the portion of increase in value it is adding after making the purchase. Further, the business will get a credit of the taxes paid by the supplier on value added by them.

When should I collect VAT?

If you are a business and transacting for any value in excess of AED 375,000 in a year, you are required to collect VAT at the rate of 5% on the values of supplies made by you. Further you are required to file a periodic form with the Federal Tax Authority for reporting the taxes paid by you.

Procedural Aspects

Registration process:

Every taxable person who is required to comply with VAT regulations needs to obtain registration with FTA.

Click here for detailed process of registration

Obtaining Refunds:

FTA will disburse refund amount within 20 days from receipt of complete refund application.

Click here for detailed process of filing refund claim

Filing of VAT Returns:

The taxable person which have obtained the registration are required to file the VAT return with FTA periodically.

Click here for detailed process of filing VAT return

Refund claim by Business Visitors:

Visitors travelling to UAE and buying goods for their business can claim refund of the VAT paid on purchases.

Click here for detailed process of refund claim