How it is calculated
Gross = Net × 1.05 Net = Gross ÷ 1.05 VAT = Gross × 5 ÷ 105The UAE has applied VAT at 5% since 2018 through the Federal Tax Authority, with zero-rating for exports, education, basic healthcare and others, and exemptions such as residential property after first sale.
Worked example
A 2,000 AED net service: VAT = 100, gross = 2,100 AED. A 525 AED VAT-inclusive invoice: VAT = 525 × 5 ÷ 105 = 25 AED.
Frequently asked questions
When must a business register?
Mandatory above AED 375,000 of annual supplies; voluntary from AED 187,500.
Does corporate tax affect prices?
Corporate tax (9% above a threshold) is on profits; it is not added to customer invoices like VAT.
Are displayed prices VAT-inclusive?
Prices shown to consumers must include VAT.
Rules last checked: 2026-10