VAT on Commercial Property in the UAE
The UAE introduced VAT on January 1, 2018, at a standard rate of 5%. It is an indirect tax applied to the consumption of goods and services, collected by registered businesses and forwarded to the Federal Tax Authority (FTA). Similarly, the sale or lease of commercial real estate is also subject to the standard VAT rate. The suppliers are required to charge 5% VAT on commercial property in UAE. This way they can also recover any VAT paid on the costs related to the supply.VAT on Commercial Property Sales in the UAE
The sale of commercial property in the UAE is subject to the standard Value Added Tax (VAT) rate of 5%. This applies to the total consideration received by the seller, including any installments.
Commercial buildings in the UAE exceeding a purchase value of AED 5 million are considered capital assets for VAT purposes.
VAT Registration Process for Commercial Property in UAE
Registering for VAT (Value Added Tax) for commercial property in the UAE involves several steps. Here’s a general process:
1. Assess Your VAT Registration Requirement
2. Prepare Documentation
3. Create an e-Services Account
4. Register for VAT
5. Payment and Processing
6. Receive Notification and Use Your TRN
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