You must register for VAT in the UAE once your taxable supplies and imports exceed AED 375,000 over the past 12 months, or when you expect them 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 portal, the FTA itself charges no fee to register, and the FTA reviews the application before issuing a Tax Registration Number (TRN). These thresholds were current when we checked the FTA's site; confirm the latest rules before you apply.
This is general guidance, not tax advice. For your own position, speak to a registered tax agent.
The thresholds explained
VAT (value added tax) in the UAE is charged at a standard rate of 5% on most goods and services. Whether you must register depends on the value of your taxable supplies (sales that are standard-rated or zero-rated) plus imports.
| Situation | Threshold | Registration |
|---|---|---|
| Taxable supplies and imports over the last 12 months | Above AED 375,000 | Mandatory |
| Expected taxable supplies and imports in the next 30 days | Above AED 375,000 | Mandatory |
| Taxable supplies, imports or taxable expenses over 12 months (or expected in 30 days) | Above AED 187,500 | Voluntary (optional) |
| Below AED 187,500 | — | Generally cannot register |
Two details catch founders out:
- The 12-month test is rolling. It is not your financial year. At the end of every month, look back over the previous 12 months.
- The 30-day test looks forward. If you sign one large contract that will push you over AED 375,000 within 30 days, the obligation can start before you have earned the money.
Exempt supplies (for example, some financial services and residential property) do not count towards the threshold. The full rules are on the FTA's registration for VAT page.
Should you register voluntarily?
Voluntary registration lets you reclaim VAT you pay on business costs, and some clients prefer suppliers with a TRN. But it also means quarterly returns, proper records and VAT on your invoices.
Voluntary registration often makes sense if:
- You have large set-up costs with VAT, such as fit-out or equipment.
- Your clients are VAT-registered businesses that can recover the VAT you charge.
- You are close to the mandatory threshold and expect to cross it soon.
It may not be worth it yet if your clients are mainly consumers who can't recover VAT, or your expenses carry little VAT.
Documents you will need
The EmaraTax application asks for information about the business, its owners and its turnover. Prepare these before you log in:
- Trade licence, valid, with all pages.
- Memorandum or articles of association, or a partnership agreement.
- Passport and Emirates ID of the owners and the authorised signatory.
- Proof of authority for the signatory, such as a power of attorney or the relevant clause in the MoA.
- Contact details and business address in the UAE.
- Bank details in the company's name (IBAN). The FTA lists a bank letter as optional.
- Turnover evidence: a declaration of taxable supplies for the last 12 months and expected supplies for the next 30 days, supported by invoices, contracts or financial statements.
- Customs registration details, if you import or export goods.
Some advisers prepare the turnover declaration on company letterhead and have it signed by the manager. Requirements can change, so check the current checklist on the FTA's VAT registration service page.
Step-by-step: registering on EmaraTax
- Create an EmaraTax account, or sign in with UAE PASS.
- Create a taxable person profile for the company, if one doesn't already exist from Corporate Tax registration.
- Choose VAT registration and complete the sections: entity details, identification (licence), business activities, owners, contact details, bank details and the authorised signatory.
- Declare your turnover and upload supporting documents.
- Review and submit. The FTA may ask for more information; reply through the portal.
- Receive your TRN and VAT certificate once approved. Your first VAT period and return due dates appear in your account.
Processing time varies with the quality of the application and FTA workload. As an estimate, allow a few weeks and respond quickly to any clarification request.
Deadlines and penalties
Once you cross the mandatory threshold, you have a limited period to apply; the FTA's guidance says 30 days. Late registration can bring an administrative penalty, published at AED 10,000 at the time of writing. Confirm the current penalty schedule on tax.gov.ae.
After registration, the obligations continue:
- Charge VAT on taxable sales and issue valid tax invoices.
- File VAT returns for each tax period, typically quarterly, and pay any VAT due by the deadline shown in EmaraTax.
- Keep records of invoices, contracts and accounts for the period the law requires.
- Prepare for e-invoicing. The UAE is introducing mandatory e-invoicing in phases; see our guide to UAE e-invoicing for free zone companies.
VAT for free zone companies
Being in a free zone does not remove VAT. Most free zone companies apply VAT just like mainland ones. The exception is a small number of designated zones, where certain movements of goods between companies inside those zones can be outside the scope of VAT. Services are generally taxed normally even in designated zones. If you trade goods from a designated zone, get specific advice.
VAT and Corporate Tax are separate registrations. Even if you never reach the VAT threshold, your company still has to register for Corporate Tax. Our Corporate Tax registration service handles that side.
How we help
Freezone King is not the FTA and does not issue TRNs. We prepare your VAT application, check that your turnover evidence supports it, submit it through EmaraTax on your behalf and deal with clarification requests. Our fee is a service fee; the FTA registration itself is free. Details are on our VAT registration in UAE page.
Next step: if you're planning a new company, use the cost calculator to budget setup, then message us on WhatsApp to check whether you need to register for VAT from day one.
Ready to set up your company?
Get a free recommendation and full cost breakdown from our advisors.
Frequently asked questions
What is the VAT registration threshold in the UAE?
Registration is mandatory when taxable supplies and imports exceed AED 375,000 over the past 12 months or are expected to in the next 30 days. Voluntary registration is possible from AED 187,500.
Is there a government fee for VAT registration?
The FTA does not charge a fee to register for VAT on EmaraTax. If you use an adviser, you pay their service fee only.
What happens if I register for VAT late?
The FTA can impose an administrative penalty for late registration, published at AED 10,000 at the time of writing. Confirm the current penalty on tax.gov.ae.
Do free zone companies have to register for VAT?
Yes, if they pass the threshold. Only certain movements of goods within designated zones can fall outside VAT; services are generally taxed normally.
About the author
Freezone King Advisory Team is the business-setup advisory team at Freezone King, a Sky Palace Business Setup company. We help founders compare UAE free zones and handle licences, visas, banking and tax end to end.
