VAT registration is mandatory once your taxable turnover exceeds AED 375,000. Here is every requirement, document, threshold, and deadline — fully updated for 2025.
Value Added Tax (VAT) was introduced in the UAE on 1 January 2018 under Federal Decree-Law No. 8 of 2017, at a standard rate of 5%. Businesses collect VAT on taxable supplies on behalf of the government and remit the net amount to the Federal Tax Authority (FTA) through periodic returns filed on EmaraTax.
Mandatory VAT registration applies when your taxable supplies and imports in the previous 12 months exceed AED 375,000 — or when you expect to exceed AED 375,000 in the next 30 days. You must register within 30 days of crossing the threshold. Voluntary VAT registration is available if your taxable supplies, imports, or eligible expenses exceed AED 187,500 annually. Non-resident businesses making taxable supplies in the UAE must register regardless of turnover, unless the supply falls under the reverse charge mechanism.
Failing to register within 30 days of exceeding the AED 375,000 threshold results in a fixed AED 10,000 penalty. Late registration also triggers retroactive VAT liability on all taxable supplies from the date registration was due. The penalty for late VAT return filing is AED 1,000 for the first offence and AED 2,000 for repeat offences within 24 months. Under the updated framework effective 14 April 2026 (Cabinet Decision No. 129 of 2025), the late payment penalty is now 14% per annum.
From 1 January 2026, the requirement to issue a self-invoice for standard reverse charge imports has been removed under Federal Decree-Law No. 16 of 2025. However, the obligation to declare and pay the VAT on reverse charge transactions remains fully in force. Record-keeping penalty amounts were also updated under Cabinet Decision No. 129 of 2025: AED 5,000 for first offence (reduced from AED 10,000) and AED 10,000 for repeat offences.
You are required to monitor your rolling 12-month taxable turnover continuously. The 30-day window to register starts from the day you cross AED 375,000 — not from the end of the financial year. Late registration carries both a penalty and a retroactive VAT liability, making it one of the most expensive compliance mistakes UAE businesses make.
Marifah Tax Advisory handles your complete VAT registration with the FTA — from document preparation to TRN issuance. We ensure your application is accurate, complete, and approved without delays. Contact us for a free consultation.