Who must register for VAT in the UAE?

Businesses must register mandatorily when taxable supplies exceed AED 375,000 in the past 12 months or are expected to exceed this threshold in the next 30 days. Voluntary registration is available for businesses exceeding AED 187,500.

How often do I need to file VAT returns?

Most businesses file quarterly VAT returns. Businesses with annual turnover above AED 150 million are required to file monthly. All returns must be submitted within 28 days from the end of the tax period.

What happens if I miss the VAT filing deadline?

Late filing penalties start at AED 1,000 and increase based on the length of delay. Late payment incurs additional penalties and potential interest charges. Repeated non-compliance can lead to fines up to AED 50,000.

Can I claim VAT on all business expenses?

No. Input VAT is recoverable only on expenses directly linked to taxable supplies. VAT on entertainment, personal use, and certain blocked categories cannot be claimed. Proper documentation is required for all claims.

What is the difference between zero-rated and exempt supplies?

Zero-rated supplies (0% VAT) allow businesses to recover input tax on related costs. Exempt supplies do not charge VAT and do not allow input tax recovery, which can increase costs for businesses making exempt supplies.

VAT Advisory & Compliance That Works for your Business

Navigate UAE VAT with confidence. From registration to returns, compliance reviews to FTA support, KPI provides practical VAT guidance that keeps your business compliant and your operations smooth

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When Businesses Need VAT Guidance & Support

VAT influences how you price, contract, and manage cash flow. When handled well, it becomes routine. When handled poorly, it leads to penalties, cash flow issues, and FTA scrutiny. Addressing VAT correctly from the start prevents disruption and keeps it predictable.VAT typically becomes a focus when organisations:

Start taxable operations or reach registration thresholds
Expand into new activities, markets, or group structures
Enter complex supplier, customer, or cross-border arrangements
Implement new ERP systems or change operational models
Face FTA inquiries, audits, or penalty notices
Need alignment between finance, legal, procurement, and operations

Understanding UAE VAT

Value Added Tax (VAT) was introduced in the UAE in 2018 at a standard rate of 5%. It applies to most goods and services, with specific rules for registration, rates, and compliance.

VAT Registration Thresholds

VAT Rates in the UAE

VAT Return Filing

Mandatory registration: Required when taxable supplies exceed AED 375,000 in the past 12 months or are expected to exceed this amount in the next 30 days
Voluntary registration:Available when taxable supplies exceed AED 187,500 in the same period
Group registration: Group registration: Businesses with multiple UAE entities can register as a single taxable group

5% standard rate: Applied to most goods and services
0% zero-rated: Exports, international transport, and certain supplies
Exempt supplies: Residential property, certain financial services
Reverse Charge Mechanism (RCM): For specific imported services and goods
Out of scope: Transactions outside UAE VAT jurisdiction

Filing frequency: Monthly (for businesses with annual turnover above AED 150 million) or quarterly (for most other businesses)
Deadline: VAT returns and payments must be submitted within 28 days from the end of each tax period
Penalties: Late filing can result in penalties starting at AED 1,000, with additional fines for late payment and non-compliance reaching up to AED 50,000

Our VAT Advisory Services

KPI supports businesses across the full VAT lifecycle, from registration to ongoing advisory and compliance. All services are tailored to your business complexity and need, not templates.

VAT Registration &
Deregistration

Assess VAT obligations, registration
support, and deregistration where
needed - aligned with business
activity and thresholds.

Advisory &
Structuring

Provide practical guidance on VAT
treatment for transactions,
contracts, pricing models, and
operating structures.

Compliance &
Return Filing

Preparation and review of monthly
or quarterly VAT returns,
reconciliation with accounting
records, accurate calculation
of output and input tax, and timely
submission within the 28-day
deadline to avoid penalties.

Reviews &
Health Checks

Independent review of VAT positions,
filings, and processes
to identify gaps, risks, or
opportunities for improvement.

Who We Commonly Support

Our VAT services are relevant for: