A UAE business must register for VAT when its taxable supplies and imports exceed AED 375,000 over the previous 12 months, or are expected to exceed that amount in the next 30 days. You may register voluntarily from AED 187,500. Registration is done online through the Federal Tax Authority’s EmaraTax platform using UAE Pass, and late registration carries a fixed AED 10,000 penalty (as of October 2026).
VAT thresholds at a glance
| Type | Threshold | Test |
|---|---|---|
| Mandatory | AED 375,000 | Taxable supplies and imports in the past 12 months, or expected in the next 30 days |
| Voluntary | AED 187,500 | Taxable supplies, imports or taxable expenses in the past 12 months, or expected in the next 30 days |
The standard VAT rate is 5%. Zero-rated supplies (for example many exports) still count towards the threshold; exempt supplies do not.
Should you register voluntarily?
Voluntary registration can make sense if you have significant start-up costs, because once registered you can generally recover VAT paid on business expenses. It also reassures larger clients, who often prefer suppliers with a Tax Registration Number (TRN). The trade-off is an ongoing obligation to keep records and file returns, even in quiet periods.
How the 12-month test works
The test is a rolling one. At the end of every month, add up your taxable supplies for the last 12 months. If the total is above AED 375,000, you must apply. You must also look forward: if you sign a contract that will take you over the threshold within the next 30 days, you need to register now.
How to register for VAT: step by step
- Create an EmaraTax account with UAE Pass. FTA services are available through UAE Pass.
- Prepare your documents (see checklist below).
- Complete the VAT registration form: entity details, business activities, turnover figures, bank details and authorised signatory.
- Submit and respond to any FTA queries promptly. Missing documents are the most common cause of delay.
- Receive your TRN and VAT certificate, then start charging VAT and issuing tax invoices from the effective date.
Documents checklist
- Trade licence (valid).
- Passport and Emirates ID of the owners and the authorised signatory.
- Memorandum or Articles of Association, where applicable.
- Proof of authority for the signatory (for example a power of attorney).
- Turnover evidence for the last 12 months, such as sales invoices or management accounts.
- Estimated turnover and expenses for the next 30 days.
- Company bank account details.
- Customs registration number, if you import or export goods.
After registration: your ongoing obligations
- Issue compliant tax invoices showing your TRN.
- File VAT returns, usually quarterly, within 28 days after the end of each tax period.
- Pay any VAT due by the same deadline.
- Keep records and invoices for the required retention period.
- Prepare for e-invoicing: under the current timetable, businesses with revenue below AED 50 million must appoint an accredited service provider by 31 March 2027 and go live by 1 July 2027.
2026 changes to know
From 1 January 2026, amendments to the VAT law removed the need for self-invoicing under the reverse charge and introduced a five-year limit on reclaiming excess input tax. From 14 April 2026, a new penalty table under Cabinet Decision No. 129 of 2025 came into force.
VAT penalties (from 14 April 2026)
| Violation | Penalty |
|---|---|
| Late registration | AED 10,000 |
| Late deregistration | AED 1,000, then AED 1,000 each month, up to AED 10,000 |
| Late VAT return | AED 1,000 first time; AED 2,000 if repeated within 24 months |
| Late payment | 14% per year, applied monthly on the unpaid tax |
Source: FTA consolidated Cabinet Decision No. 40 of 2017 as amended. Penalties apply per breach, so they can add up quickly.
Deregistration
If you stop making taxable supplies, or your turnover falls below the voluntary threshold for 12 months, you may need to apply to deregister. Missing the deadline triggers the late deregistration penalty above.
Tax groups and multiple businesses
If you own or control more than one UAE company, you may be able to register them together as a VAT tax group, with a single TRN and a single return. Members must be UAE-resident and related through ownership or control. Grouping can simplify compliance, but all members become jointly responsible for the group’s VAT, so it needs careful thought.
Common VAT registration mistakes
- Waiting for the financial year end to check turnover, instead of monitoring the rolling 12-month total each month.
- Ignoring the 30-day forward-looking test when a large contract is signed.
- Choosing the wrong effective date, which can create back-dated VAT liabilities.
- Entering business activities that do not match the trade licence.
- Not charging VAT on invoices issued after the effective date, then having to absorb it.
Correcting mistakes after registration
If you find an error in a VAT return you have already filed, the FTA expects you to correct it, either in a later return or through a voluntary disclosure, depending on the amount and type of error. Correcting errors before the FTA contacts you is generally treated more favourably than waiting for an audit. Keep clear working papers so you can show how each figure was calculated.
How Tajnes can help
We coordinate VAT registration and the related company documents, working with qualified tax professionals. Our fees are open-book, and VAT at 5% applies to our service fee only, not to government fees. Visit our tax page, check the cost calculator, see offers or book a consultation.
Frequently asked questions
What is the VAT registration threshold in the UAE?
AED 375,000 of taxable supplies and imports in the past 12 months, or expected in the next 30 days. Voluntary registration is possible from AED 187,500.
What is the penalty for late VAT registration?
AED 10,000, as of October 2026.
How long does VAT registration take?
It depends on the FTA’s review and whether documents are complete. The FTA may raise queries before issuing a TRN.
Can a free zone company register for VAT?
Yes. Free zone companies follow the same thresholds unless they operate in a designated zone with specific rules for certain goods.
How often do I file VAT returns?
Usually quarterly, within 28 days after the end of each tax period.
Is VAT charged on government fees?
Government fees are passed through at cost. VAT applies to a provider’s own service fee.
General information, not legal or tax advice. Rules and fees change and authorities make all final decisions. T&Cs apply.
