Introduction of VAT in the UAE from the next year

VAT is going to be introduced at a rate of five percent in the United Arab Emirates starting from 2018. Adoption of relevant legislation will occur in the near future.

Several segments of the market will be exempt from paying VAT, namely:
- Certain financial services;
- Internal transportation of passengers;
- Preparing or selling unprepared land parcels;
- Secondary real estate sales.

Zero VAT is planned for particular spheres. The foregoing refers to health care service, education, primary sales of quarters, international transportations and related services, and exports outside the territories of the Cooperation Council for the Arab States of the Gulf.

In case of exceeding the amount received over 375,000 dirhams (approximately one hundred and two thousand US dollars), registration as VAT payer will be mandatory.

For more detailed information regarding this issue, please contact lawyers of Law&Trust International.