The rate
The standard rate in the United Arab Emirates is 5%. Some goods and services carry reduced or zero rates and others are exempt. The difference matters: zero-rated sales still let you reclaim the tax on your purchases, exempt sales do not.
Who must register
Compulsory above AED 375,000 of taxable supplies in 12 months; voluntary above AED 187,500.
How to register
A person who must register (Executive Regulation, Article 7) files the application with the FTA within 30 days of becoming liable, through the means the FTA specifies. If taxable supplies passed AED 375,000 in the previous 12 months, or are expected to within 30 days, the FTA can register the person from the first day of the month after the month registration was required, whether or not an application was filed.
A business below the mandatory level may register voluntarily from AED 187,500 of supplies or taxable expenses (Article 8), and must satisfy the FTA that it carries on a business in the UAE. Voluntary registration takes effect on the first day of the month after the application, unless an earlier date is agreed.
A late registrant owes tax on all taxable supplies made before registering (Article 7(7)) and an AED 10,000 penalty under Cabinet Decision No. 40 of 2017.
Filing and paying
Registered and filed with Federal Tax Authority (FTA).
Quarterly (monthly for large businesses) VAT returns on EmaraTax, due by the 28th of the month after the tax period, with payment by the same date.
Penalties for getting it wrong
AED 1,000 for a first late return and AED 2,000 for repeats within 24 months; late payment is charged at 14% a year, applied monthly, since 14 April 2026 (Cabinet Decision 129 of 2025, amending Decision 40 of 2017).