What is the VAT rate in the UAE?

The standard VAT rate in the UAE is 5%, introduced on 1 January 2018 under Federal Decree-Law No. 8 of 2017. This rate applies to most goods and services unless they are specifically zero-rated or exempt.

Is rent subject to VAT in the UAE?

It depends on the property and transaction. A qualifying residential-building supply may be exempt unless it qualifies for zero-rating; serviced and hotel-like accommodation is excluded from the residential-building definition. Commercial-property supplies are generally standard-rated, subject to the full transaction facts.

Is gold VAT-free in Dubai?

Only qualifying investment precious metal is zero-rated under this rule: gold, silver, or platinum must be at least 99% pure and in a form tradeable in global bullion markets. Purity alone does not make jewellery zero-rated.

How do I calculate VAT on an amount?

To add 5% VAT, calculate 5% of the VAT-exclusive line and add it. To extract VAT from an inclusive line, divide by 1.05 and subtract the result from the original. Round the VAT on each line mathematically to the nearest fils. For example, AED 1,000 + VAT = AED 1,050 and the VAT inside AED 1,050 is AED 50.

What is the difference between zero-rated, exempt, and out of scope?

A zero-rated supply is taxable at 0% and may allow input-tax recovery under the normal rules. An exempt supply has no output VAT and generally restricts related input-tax recovery. An out-of-scope activity is not an exempt supply; it falls outside the VAT charge or is not a supply.

How does this worksheet round VAT?

The worksheet mathematically rounds the VAT on each line to the nearest fils (two decimal places), then sums the rounded line amounts. This follows Article 61 of the VAT Executive Regulation and FTA tax-invoice guidance.

UAE VAT Arithmetic & Line Worksheet

Add or extract 5% VAT with nearest-fils line rounding. Legal status is selected by you; the separate FTA reference guide does not classify transactions automatically.

⚠️ Disclaimer: This tool performs arithmetic after you choose a VAT treatment. The reference guide is conditional, non-exhaustive, and is not tax advice or an invoice generator. Verify the current law and your facts with the FTA or a qualified UAE tax adviser.

Arithmetic and legal classification are separate

The calculator never decides whether a supply is standard-rated, zero-rated, exempt, or out of scope. Choose a treatment only when you already know it. Use the dated reference guide below to identify questions and conditions—not as an automated legal conclusion.

Arithmetic inputs

Amount

AED

Enter no more than two decimal places.

Amount basis

Known VAT treatment

Use only after determining that no zero-rate, exemption, or out-of-scope rule applies.

Standard-rated (5%): Adds or extracts 5% VAT. Use only after determining that no zero-rate, exemption, or out-of-scope rule applies.

Total incl. VAT

—

Enter an amount above to calculate.

Arithmetic breakdown

Amount excl. VAT—

VAT—

Amount incl. VAT—

Conditional FTA reference guide

This is a narrow, non-exhaustive reading guide, not a classifier. Every entry lists conditions and a dated official source. If a condition is unclear—or your transaction is not listed—do not infer a status from the arithmetic tool.

Search the reference entries

Standard 5%General UAE taxable supply or import

Conditions to verify

The transaction is a taxable supply or import within the scope of UAE VAT.
No specific zero-rate, exemption, reverse-charge, designated-zone, or out-of-scope rule applies.
Whether a supplier must charge VAT also depends on registration and the transaction facts.

Official source: Federal Decree-Law No. 8 of 2017 and amendments · FTA consolidated PDF published 3 Dec 2025 · Articles 2–3

Zero-rated 0%Qualifying educational service in the UAE

Conditions to verify

The curriculum is recognised by the competent federal or local education authority.
The supplier is an institution recognised by that authority.
A higher-education institution must be government-owned or receive more than 50% of annual funding directly from government.
Private tutoring, unrecognised courses, separately charged extracurricular activities, uniforms, devices, and food do not qualify merely because they relate to education.

Official source: FTA Education Sector VAT Guide VATGED1 · Issued 29 Jun 2026 · Sections 3.3 and 4.3

Zero-rated 0%Investment precious metal

Conditions to verify

The metal is gold, silver, or platinum.
Purity is at least 99%.
The form is tradeable in global bullion markets; jewellery does not qualify merely because of purity.

Official source: VAT Executive Regulation, as amended · Cabinet Decision No. 100 of 2025 effective 29 Sep 2025 · Article 36

Zero-rated 0%First supply of a newly completed residential building

Conditions to verify

It is the first supply by sale or lease within three years of completion.
The property meets the residential-building definition.
Hotels, motels, bed-and-breakfast premises, hotel/serviced apartments, and unlawfully built or converted premises are excluded from that definition.

Official source: Federal Decree-Law No. 8 of 2017 and amendments and Executive Regulation Article 37 · FTA consolidated law published 3 Dec 2025 · Article 45(9)

ExemptResidential building sale or qualifying lease (not zero-rated)

Conditions to verify

The property meets the residential-building definition and the supply is not zero-rated.
For a lease, the contractual term exceeds six months or the tenant holds an Emirates ID.
Serviced accommodation and hotel-like premises are not residential buildings for this rule.

Official source: VAT Executive Regulation, as amended · Cabinet Decision No. 100 of 2025 effective 29 Sep 2025 · Articles 37 and 43

ExemptBare land

Conditions to verify

The land is not covered by completed or partially completed buildings.
The land is not covered by civil-engineering works.

Official source: VAT Executive Regulation, as amended · Cabinet Decision No. 100 of 2025 effective 29 Sep 2025 · Article 44

ExemptQualifying local passenger transport

Conditions to verify

Passengers travel from one place in the UAE to another using a qualifying passenger vehicle, vessel, or aircraft.
The service is not international carriage by air.
A pleasure or sightseeing trip whose main objective is entertainment or catering is excluded.

Official source: VAT Executive Regulation, as amended · Cabinet Decision No. 100 of 2025 effective 29 Sep 2025 · Article 45

Out of scopeEmployee remuneration for employment duties

Conditions to verify

The individual is acting as an employee, not carrying on an independent business activity.
Independent-contractor services can be taxable and must be assessed separately.

Official source: FTA Taxable Person Guide VATG001 · Issued Jun 2018 · Section 5.2.3

Catalogue reviewed 30 July 2026. Laws and guidance can change; follow the source links before relying on a classification.

VAT Basics

The UAE introduced Value Added Tax on 1 January 2018 at a standard rate of 5% — one of the lowest globally. VAT is an indirect consumption tax collected at every stage of the supply chain but ultimately paid by the end consumer. As a resident, you'll see it on restaurant bills, phone plans, electronics, clothing, and most services. The Federal Tax Authority (FTA) administers VAT in the UAE under Federal Decree-Law No. 8 of 2017 and its executive regulations.

Registration Is Separate from Arithmetic

The FTA states that the mandatory registration threshold is AED 375,000 and the voluntary threshold is AED 187,500, subject to the statutory tests. Whether a person is registered or required to register affects who accounts for VAT; it does not change the calculator's 5% arithmetic. Check current registration guidance in EmaraTax or on the FTA website.

Four Distinct Treatment States

Standard-rated supplies use 5% arithmetic. Zero-rated supplies are taxable at 0% and may permit input-tax recovery under the normal rules. Exempt supplies have no output VAT and generally restrict related input-tax recovery. Out-of-scope / not-a-supply activities are not exempt supplies. The same AED 0 tax result does not make those legal states interchangeable.

Input Tax Credit

Input-tax recovery is governed by separate statutory conditions, documentary requirements, blocked-expense rules, and apportionment rules. Zero-rated and exempt supplies can therefore have different recovery consequences even though both show AED 0 output VAT in simple customer arithmetic. This tool does not calculate recoverable input tax or a VAT return.

Line Rounding and Mixed Supplies

FTA tax-invoice guidance says VAT should be calculated and mathematically rounded to the nearest fils on a line-by-line basis. That means the sum of rounded line VAT can differ from 5% of the combined net total. A mixed transaction may also contain lines with different treatments. The worksheet therefore stores the amount basis and treatment per row, rounds each row first, and only then totals the rows.

UAE VAT Arithmetic & Line Worksheet

Arithmetic and legal classification are separate

Arithmetic inputs

Arithmetic breakdown

Conditional FTA reference guide

VAT Basics

Registration Is Separate from Arithmetic

Four Distinct Treatment States

Input Tax Credit

Line Rounding and Mixed Supplies

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Frequently Asked Questions

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