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FTA Decree-Law 8 Verified 2026

UAE 5% VAT Registration Threshold Calculator

Evaluate mandatory (AED 375k) vs voluntary (AED 187.5k) VAT registration requirements under Federal Decree-Law No. 8 of 2017.

Understanding UAE Value Added Tax (VAT) Legislation

Enacted under Federal Decree-Law No. 8 of 2017, Value Added Tax (VAT) is levied at a standard rate of 5% on taxable supplies of goods and services. The tax is administered by the Federal Tax Authority (FTA).

Failing to register within 20 business days of reaching the mandatory AED 375,000 threshold incurs an automatic AED 10,000 late registration penalty. For corporate tax considerations, see our 9% Corporate Tax & Freezone Guide.

Evaluate Annual Taxable Revenue

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VAT Threshold Summary

Mandatory Threshold:AED 375,000 / year
Voluntary Threshold:AED 187,500 / year
Standard VAT Rate:5% Tax Rate
Export Services Rate:0% (Zero-Rated)

Interlinked UAE Compliance Portals

🏢 9% Corporate Tax & Freezone Guide →📜 Corporate Tax Residency Certificate →🪙 Personal 0% Tax & Remittance Rules →

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Frequently Asked Questions (FTA 5% VAT Rules)

Under Federal Decree-Law No. 8 of 2017, business entities residing in the UAE must register for 5% VAT if their taxable supplies and imports exceed AED 375,000 in the preceding 12 months or are expected to exceed AED 375,000 in the next 30 days.

Businesses can voluntarily register for VAT if their annual taxable supplies or taxable expenses exceed AED 187,500, allowing them to recover input VAT incurred on business costs under our Corporate Tax Guide.

Zero-rated 0% VAT applies to exports of goods/services outside the GCC, international transport, healthcare, basic education, and the first supply of residential property within 3 years of completion.

Exempt supplies include bare land, margin-based financial services, local passenger transport, and residential building leases under our Ejari Tenancy Guide.

Under Cabinet Decision No. 40 of 2017, failing to submit a mandatory VAT registration application within the statutory deadline results in an administrative penalty of AED 20,000.

Registered businesses must submit VAT returns and pay due VAT quarterly (every 3 months) or monthly (for large entities) within 28 days following the end of each tax period.
FTA VerifiedOfficial Primary Reference Links

• Federal Tax Authority (FTA VAT Registration Portal): tax.gov.ae
• FTA EmaraTax e-Services Portal: eservices.tax.gov.ae