United Arab Emirates VAT guidelines
| FACTSHEET | |
|---|---|
| Country code | AE |
| Tax name | Value Added Tax (VAT) |
| Tax Authority | Federal Tax Authority (FTA) |
Overview
The United Arab Emirates levies Value Added Tax (VAT) at a standard rate of 5% on the supply and import of goods and services. VAT was introduced by Federal Decree-Law No. 8 of 2017, which came into effect on 1 January 2018 (Article 85); the 5% standard rate is set by Article 3 of the Decree-Law. [1] VAT is administered by the Federal Tax Authority (FTA). [2]
The UAE also introduced a federal Corporate Tax for financial years starting on or after 1 June 2023, but this guide focuses on VAT and indirect-tax compliance.
Source snapshot captured 19 July 2026 — original (u.ae — the UAE government portal)
TRN & registration
VAT registration is completed online through the FTA's EmaraTax platform. On approval, the business is issued a Tax Registration Number (TRN), which appears in the dashboard of the taxpayer's e-Services account; the FTA's stated processing time is 20 business days from receipt of a completed application. [1]
- Mandatory registration — AED 375,000. A UAE-resident business must register if the total value of its taxable supplies and imports exceeded AED 375,000 over the previous 12 months, or is anticipated to exceed it within the next 30 days. This threshold does not apply to foreign businesses — non-residents making taxable supplies in the UAE must register regardless of value. [2]
- Voluntary registration — AED 187,500. A business may register voluntarily if its taxable supplies and imports, or its taxable expenses, exceeded AED 187,500 in the previous 12 months. [2]
Source snapshot captured 19 July 2026 — original (Federal Tax Authority)
You can check a UAE TRN with our United Arab Emirates TRN validator.
Tax rates
- Standard rate: 5% — applies to most supplies and imports of goods and services (Article 3, Federal Decree-Law No. 8 of 2017). [1]
- Zero rate: 0% — Article 45 of the Decree-Law zero-rates, among others: direct or indirect exports outside the Implementing States; international transport of passengers and goods; supply of certain means of transport (air, sea, land) and related goods/services; investment precious metals; the first supply of residential buildings within 3 years of completion; supply or import of crude oil and natural gas; specified education services (government-owned or funded institutions); and preventive and basic healthcare services. [1]
- Exempt — Article 46 exempts: specified financial services; the supply of residential buildings (other than the zero-rated first supply); bare land; and local passenger transport. Exempt suppliers cannot recover input VAT on related costs. [1]
E-invoicing
The UAE is rolling out a national Electronic Invoicing System based on a Decentralised Continuous Transaction Control and Exchange (DCTCE) model — a Peppol five-corner architecture in which the supplier (Corner 1) and buyer (Corner 4) exchange invoices through Accredited Service Providers (ASPs) (Corners 2 and 3), with tax data reported to the FTA (Corner 5). Electronic invoices are exchanged as XML based on the Peppol PINT AE specification. [1]
Legal framework. The system is framed by Ministerial Decision No. 243 of 2025 (scope and obligations of the Electronic Invoicing System) and Ministerial Decision No. 244 of 2025 (implementation timeline), supported by Ministerial Decision No. 64 of 2025 (ASP accreditation) and Cabinet Decision No. 106 of 2025 (violations and penalties). In 2026 the Ministry of Finance issued targeted amendments: Ministerial Decision No. 66 of 2026 amends Decision 244, and Ministerial Decision No. 56 of 2026 amends Decision 64. [1] [2]
4-corner launch (April 2026). On 21 April 2026 the Ministry of Finance launched the optional eInvoicing 4-Corner model: businesses select an MoF-accredited Service Provider through the FTA's EmaraTax system, complete onboarding, and begin exchanging structured e-invoices between Corner 1 and Corner 4 ahead of the tax-reporting (Corner 5) go-live and the July pilot. [3]
Pilot and voluntary phase (from 1 July 2026). Electronic invoicing commenced on 1 July 2026 with a Pilot Programme for a selected group of taxpayers who agree in writing to participate; the MoF announced the pilot launch of the 5-Corner model on 26 June 2026. All businesses, regardless of revenue, may implement e-invoicing voluntarily from 1 July 2026 — administrative penalties apply only from a business's mandatory implementation date. [4] [5]
Mandatory timeline. Under Ministerial Decision No. 244 of 2025 as amended: [2] [5]
| Entity | Annual revenue | Appoint ASP by | Implement e-invoicing from |
|---|---|---|---|
| Business | ≥ AED 50,000,000 | 30 October 2026 (extended from 31 July 2026) | 1 January 2027 |
| Business | < AED 50,000,000 | 31 March 2027 | 1 July 2027 |
| Government entity | N/A | 31 March 2027 | 1 October 2027 |
Source snapshot captured 18 July 2026 — original (UAE Ministry of Finance); the 30 October 2026 ASP extension is per the May 2026 amendments announcement:
Source snapshot captured 19 July 2026 — original (UAE Ministry of Finance)
Scope. E-invoicing applies to B2B and B2G business transactions (including G2B and G2G), regardless of VAT registration status. Supplies made to consumers (B2C) are not in scope — there is no obligation to issue an electronic invoice for a supply to a consumer. Transactions between members of the same VAT group are in scope but benefit from a 24-month grace period starting 1 January 2027. A person in scope must appoint one ASP for both sending and receiving; the Peppol participant identifier issued by the FTA is 0235 followed by the person's 10-digit TIN. [5]
Recent changes
Dated, officially-sourced changes to UAE VAT and e-invoicing, newest first. The full history is in our worldwide tax-updates feed.
- 2026-07-13 — UAE e-invoicing rulebook consolidated: Ministerial Decision No. 66 of 2026 amends MD No. 244 of 2025 (ASP appointment deadline for AED 50m+ businesses set at 30 October 2026; mandatory go-live unchanged at 1 January 2027) and MD No. 56 of 2026 amends the ASP accreditation rules, alongside the MoF's Electronic Invoicing Guidelines V1.1 (dated 1 June 2026). (UAE Ministry of Finance) — see issue
- 2026-07-01 — The pilot phase of the Electronic Invoicing System (5-Corner model) opened with a selected group of taxpayers; voluntary adoption is available to any business from the same date. (UAE Ministry of Finance) — see issue
- 2026-05-10 — The Ministry of Finance announced targeted amendments to the e-invoicing decisions, extending the deadline for businesses with annual revenue of AED 50 million or more to appoint an Accredited Service Provider from 31 July 2026 to 30 October 2026; mandatory go-live remains 1 January 2027. (UAE Ministry of Finance) — see issue
- 2026-04-21 — The Ministry of Finance launched the optional eInvoicing 4-Corner model: businesses can appoint an MoF-accredited Service Provider via the FTA's EmaraTax system and begin exchanging structured e-invoices. (UAE Ministry of Finance) — see issue
Reference links
- Federal Tax Authority — VAT
- FTA — Registration for VAT (thresholds)
- FTA — VAT registration service (EmaraTax)
- Federal Decree-Law No. 8 of 2017 and its amendments (FTA)
- Ministry of Finance — eInvoicing Programme
- UAE Electronic Invoicing Guidelines V1.1 (June 2026)
Frequently Asked Questions
Who must register for VAT in the UAE, and what are the thresholds?
A UAE-resident business must register once the total value of its taxable supplies and imports exceeded AED 375,000 over the previous 12 months, or is expected to exceed that within the next 30 days. Voluntary registration opens at AED 187,500 (taxable supplies and imports, or taxable expenses). The mandatory threshold does not apply to foreign businesses. Registration is done on the FTA's EmaraTax platform, and the approved applicant receives a Tax Registration Number (TRN). [1] [2]
When does e-invoicing become mandatory for my business?
In phases, by revenue. A pilot began 1 July 2026, with voluntary adoption open to all from that date. Businesses with annual revenue ≥ AED 50 million must appoint an Accredited Service Provider by 30 October 2026 (extended from 31 July 2026) and implement from 1 January 2027. Businesses below AED 50 million must appoint an ASP by 31 March 2027 and implement from 1 July 2027; government entities implement from 1 October 2027. [1] [2]
Are B2C transactions covered by the UAE e-invoicing mandate?
No. The system covers B2B and B2G transactions (including G2B and G2G). Supplies made to consumers are not within scope, and there is no obligation to issue an electronic invoice for a B2C supply — though normal VAT tax-invoice rules under the Decree-Law continue to apply. [1]
What is the difference between zero-rated and exempt supplies under UAE VAT?
Both are charged at 0%, but zero-rated suppliers (Article 45: exports, international transport, investment precious metals, first supply of residential buildings within 3 years, crude oil and natural gas, specified education and healthcare) can recover input VAT, while exempt suppliers (Article 46: specified financial services, other residential supplies, bare land, local passenger transport) cannot recover input VAT on related costs. [1]
What is the five-corner (PINT AE) model, and what launched in April 2026?
The UAE's e-invoicing runs on a Peppol-based five-corner model: supplier (C1) → supplier's ASP (C2) → buyer's ASP (C3) → buyer (C4), with both ASPs reporting tax data to the FTA (C5). Invoices are UAE-standard XML per the PINT AE specification. On 21 April 2026 the MoF launched the optional 4-corner exchange (C1–C4, without FTA reporting) so businesses could onboard with an accredited Service Provider via EmaraTax ahead of the 1 July 2026 pilot. [1] [2]
For more details on UAE tax identifiers, see our United Arab Emirates Tax ID Guide. To verify a UAE TRN, see our UAE TRN verification guide or use the TRN validator.
