In Dubai, VAT (Value Added Tax) obligations depend mainly on where your business operates:
• a mainland (onshore territory),
• egy designated free zone (designated free trade zone),
• vagy egy Non-Designated Free Zone .
Below is a breakdown of VAT rules for each type of zone and business activity.
Mainland
• VAT Rate: 5%
• Applies To: All domestic sales and service provisions
• Requirement: VAT registration is mandatory if your annual turnover exceeds AED 375,000.
Comment: Businesses operating in designated zones are also required to register for VAT if they reach an annual turnover of AED 375,000.
Designated Free Zones
These zones are granted special VAT treatment by the UAE Federal Tax Authority (FTA). Examples include Jebel Ali Free Zone, Dubai Airport Free Zone, and DMCC.
VAT Rate:
• Goods transferred between designated zones: 0% VAT (exempt), as long as goods are not consumed within the zone.
• Our Solutions : 5% VAT, regardless of the service location.
• Transactions between mainland and designated zones (goods or services): 5% VAT.
Comment: Businesses in designated zones must still register for VAT once they reach AED 375,000 in annual turnover.
Non-Designated Free Zones
These zones do not receive any special VAT treatment and are taxed similarly to mainland businesses.
• VAT Rate: 5%
• Applies To: All domestic sales and service provisions
• Requirement: VAT registration is mandatory if your annual turnover exceeds AED 375,000.
🌐 Export and Import VAT Rules
• Exporting outside the UAE: 0% VAT, if goods/services are physically exported Importing to the mainland.
• Importing to the mainland: 5% VAT, paid by the importer.
• Importing into designated zones: Usually no immediate VAT payable, VAT becomes due once goods enter the mainland.
VAT Summary Table
| Activity / Zone | VAT Rate | Notes |
| Mainland domestic transactions | 5% | Applies to all local goods & services |
| Goods transfer between designated zones | 0% | VAT-exempt, if goods aren’t consumed in-zone |
| Services between designated zones | 5% | VAT applies regardless of service location |
| Transactions between mainland & designated zones | 5% | Applies to both goods and services |
| Non-designated free zone transactions | 5% | Same treatment as mainland |
| Export outside UAE | 0% | VAT-exempt if actual export occurs |
✅ Corporate Tax (NEW – From June 1, 2023)
The UAE introduced a 9% corporate tax on business profits, but with key thresholds:
🔹 If annual profit ≤ AED 375,000: 0% corporate tax
then the corporate tax rate is 0%.
🔹 If annual profit > AED 375,000,
on the amount exceeding that threshold a 9% tax must be paid.
This system aims to support small businesses and startups while maintaining compliance standards..
⚠️ Important to note:
• Nem minden cég érintett: sok free zone cég továbbra is mentesülhet a társasági adó alól, ha nem folytat „mainland”-ra irányuló kereskedelmet, és megfelel a „Qualifying Free Zone Person” státusznak.
• VAT is separate, VAT registration is mandatory at AED 375,000 turnover, regardless of tax status, but VAT is always 5%, with no lower tier or exemption band
