# UAE VAT Guide for 2026: Rates, Registration & Compliance

Canonical: https://trykintsugi.com/sales-tax-guides/middle-east/united-arab-emirates
Published: September 22, 2026

The UAE's VAT rate is 5%. This guide covers the AED 375,000 registration threshold, the rules for imports and digital services, and filing with the FTA.

- **SaaS:** Taxable
- **Digital Goods:** Taxable

## Key Takeaways

The UAE applies a flat 5% VAT to most goods and services, including digital supplies, in effect since 2018. Exports and international transport are zero-rated, while residential property, bare land, local passenger transport, and certain financial services are exempt. SaaS and digital services supplied to UAE customers are taxable at 5%.

## Taxability Snapshot

## Sales Tax Rates

The UAE applies a flat 5% VAT to most goods and services, including digital supplies.[1] A 0% rate covers exports, international transport, and certain sectors, and some supplies such as residential property and local passenger transport are exempt.[1] The tax authority is the Federal Tax Authority (FTA), and VAT has applied since 2018.[1]

| Rate | Applies to |
| --- | --- |
| Standard 5% | Most goods, services, digital supplies |
| Zero 0% | Exports, international transport, some sectors |
| Exempt | Residential property, local passenger transport, some financial services |

#### Registration & nexus threshold

The UAE uses a VAT registration threshold rather than US-style economic nexus. Registration is mandatory once taxable supplies and imports exceed AED 375,000 over the past 12 months or the next 30 days, and voluntary from AED 187,500 [2]. A non-resident making taxable supplies in the UAE where no other party is liable to account for the VAT must register with no threshold [2]. Registration steps are in the How to Register section.

#### Filing frequency & deadlines

VAT returns are filed through EmaraTax, with payment due within 28 days of the end of each tax period — monthly or quarterly depending on turnover.[1] Mandatory B2B and B2G e-invoicing rolls out in phases: a voluntary pilot from July 2026, mandatory for large businesses (revenue ≥ AED 50M) from January 2027, and for remaining businesses from July 2027. B2C transactions are currently out of scope.[1]

#### Exemptions

Exports and international transport are zero-rated, and residential property, bare land, local passenger transport, and certain financial services are exempt.[1] SaaS and digital services supplied to UAE customers are taxable at 5%.[1]

The UAE does not use US-style resale certificates. A registered business recovers the input VAT it pays on goods for resale and other business purchases through its VAT return [1]. Food is taxed at the standard 5%; only specific categories, such as exports and certain healthcare and education, are zero-rated, and a few, such as certain financial services and residential property, are exempt [1].

#### Penalties

Late registration carries a fixed AED 10,000 penalty. Late filing is AED 1,000 for the first offense and AED 2,000 if repeated within 24 months.[2] Late payment accrues at 14% per annum (non-compounding), calculated monthly on the outstanding VAT from the day after the due date until it is paid, under Cabinet Decision No. 129 of 2025 (effective 14 April 2026).[1]

The Federal Tax Authority audits VAT. To dispute a decision, a business first requests a reconsideration, then escalates to the Tax Disputes Resolution Committee and, if needed, the courts [5].

#### Sources

- [1] [Government of the UAE — Value Added Tax (5%, zero-rated and exempt categories)](https://tax.gov.ae/en/taxes/vat.aspx)

- [2] [UAE Federal Tax Authority — VAT registration (AED 375,000 and AED 187,500 thresholds)](https://tax.gov.ae/en/taxes/Vat/vat.topics/registration.for.vat.aspx)

- [3] [UAE Federal Tax Authority — VAT registration service (EmaraTax, TRN)](https://tax.gov.ae/en/services/vat.registration.aspx)

- [4] [UAE Federal Tax Authority — Filing VAT returns and making payments](https://tax.gov.ae/en/taxes/Vat/vat.topics/filing.vat.returns.and.making.payments.aspx)

- [5] [UAE Federal Tax Authority — Tax dispute resolution](https://tax.gov.ae/en/tax.dispute.resolution.aspx)

Verified July 2026 against the UAE Federal Tax Authority and Government of the UAE guidance.

#### Frequently asked questions

### What is the UAE VAT rate in 2026?

A flat 5% on most goods and services, with 0% on exports and exemptions for residential property and certain financial services.

### Do foreign digital sellers register for VAT in the UAE?

Yes. Non-resident providers of digital and electronic services have no threshold and must register from the first taxable supply.

### Is SaaS taxable in the UAE?

Yes. SaaS and digital services supplied to UAE customers are taxable at 5%.

### What is the UAE VAT registration threshold?

AED 375,000 mandatory and AED 187,500 voluntary for residents; non-resident digital sellers have no threshold.

### When are UAE VAT returns due?

Within 28 days of the end of each tax period, filed monthly or quarterly through EmaraTax depending on turnover.

### When does UAE e-invoicing become mandatory?

B2B and B2G e-invoicing starts with a voluntary pilot in July 2026, becomes mandatory for businesses with revenue of AED 50 million or more from January 2027 and for the rest from July 2027; B2C is out of scope for now.