UAE VAT Registration Thresholds
Value Added Tax (VAT) was introduced in the UAE on 1 January 2018 at a standard rate of 5%. Here is what you need to know about registration thresholds.
Mandatory Registration
You must register for VAT if:
- Your taxable supplies and imports exceeded AED 375,000 over the previous 12 months, or
- You anticipate they will exceed AED 375,000 in the next 30 days
Voluntary Registration
You may choose to register if:
- Your taxable supplies and imports (or taxable expenses) exceeded AED 187,500 over the previous 12 months, or
- You anticipate they will exceed AED 187,500 in the next 30 days
Why Register Voluntarily?
- Recover input VAT on business purchases
- Appear more professional to clients and partners
- Avoid penalties if you approach the mandatory threshold unexpectedly
What Counts Toward the Threshold?
- Standard-rated supplies (5%)
- Zero-rated supplies (0% but still taxable)
- Imported goods and services subject to reverse charge
- Excluded: exempt supplies (e.g., certain financial services, residential property)
Registration Process
- Log in to the FTA EmaraTax portal
- Complete the VAT registration form
- Upload supporting documents (trade licence, Emirates ID, bank details)
- The FTA issues your TRN upon approval (typically within 20 business days)
Penalties for Late Registration
Failure to register when required can result in an administrative penalty of AED 10,000.
How Kounted Can Help
We monitor your revenue trajectory and advise you on the optimal time to register. If you are already required to register, we handle the entire application process and ensure your first return is filed correctly.