Add or strip out UAE VAT.
Five per cent, both directions, with the rounding rule the Federal Tax Authority actually applies and the reverse-charge case that trips people up.
Enter an amount and press Work out the VAT.
The arithmetic is the easy part
Adding or stripping 5 % takes a second. What costs businesses money in the UAE is everything around that number: registering at the right time, telling a zero-rated supply from an exempt one, and filing within 28 days of the period end.
- Late registration once you pass 375,000 AED in taxable turnover carries a penalty, and the threshold is a rolling twelve months, not a financial year.
- Zero-rated is not exempt. On zero-rated supplies you still reclaim input VAT, on exempt ones you do not. Treating one as the other quietly overstates or understates every return you file. The designated zones add a third case that catches out most free zone companies.
- Imports fall under reverse charge, which means declaring VAT you were never invoiced for. See how the reverse charge works.
We handle VAT registration and quarterly filing as part of monthly bookkeeping, from 990 AED. See what that costs or ask us about your situation, the first call is free.
How this is calculated
Both directions
Adding VAT to a net amount is the easy way round: multiply by 5 %. Taking it out of a gross amount is where people slip, because 5 % of the gross is the wrong answer. The VAT inside a gross figure is 5 ÷ 105 of it, so AED 10,000 including VAT is AED 9,523.81 net and AED 476.19 tax, not 500.
The standard rate is 5 % and has not changed since VAT was introduced in 2018. No increase has been announced.
Rounding
Executive Regulation Article 61 permits rounding to the nearest fils on mathematical rounding, which means two decimal places, rounded up from a half. Rounding down as a habit is not what the rule says.
Where the rounding happens matters. On a full tax invoice the VAT is rounded on each line item. On a simplified invoice it is rounded on the total. Do not mix the two approaches within one document, which is exactly what happens when a spreadsheet rounds per line but the accounting system rounds the sum.
Reverse charge
When you buy services from a supplier abroad, you declare the VAT as though you were the supplier and recover it in the same return: output tax in box 3, input tax back in box 10. For a fully taxable business the two cancel out and no money moves, but leaving it out of the return is still an error. If you make exempt supplies your recovery is only partial, and then the reverse charge really does cost you.
Since 1 January 2026, Federal Decree-Law No. 16 of 2025 has removed the requirement to raise a self-invoice. The documentation obligation itself remains: you still have to keep the supplier's document and be able to show how you arrived at the figure.
Zero-rated and exempt are different things
A zero-rated supply is taxed at 0 % but remains a taxable supply: it counts towards your registration threshold and you keep full input VAT recovery. Exempt income does neither. Only four categories are exempt, so most income that people call “VAT-free” is in fact zero-rated. Whether that distinction pushes you over the registration line is what the VAT registration check answers.
What this tool does not do
- It does not decide the rate for you. Choosing between 5 %, zero-rated, exempt and out of scope is a question about your supply, not about arithmetic.
- It does not handle the profit margin scheme, partial exemption, or the capital assets scheme for items costing AED 5,000,000 or more.
- It does not prepare a return. Boxes 3, 6, 7 and 10 interact in ways a single amount cannot capture.
Legal note. The information and calculators provided here are for general information purposes only and do not replace individual tax or legal advice. Results are based on the data you enter and on the statutory rules applied at the time of calculation.
Legal position as at 15 August 2026. Sources: Federal Decree-Law No. 8 of 2017 on Value Added Tax , Cabinet Decision No. 52 of 2017, the VAT Executive Regulation , FTA public clarification VATP006 on rounding .
Common questions
- What is the VAT rate in the UAE?
- The standard rate is 5 per cent and has not changed since VAT was introduced in January 2018. No increase has been announced. Some supplies are zero-rated and others are exempt, which are two different things with different consequences for input tax recovery.
- How do I remove VAT from a gross amount?
- Take 5 divided by 105 of the gross figure, not 5 per cent of it. AED 10,000 including VAT contains AED 476.19 of tax and AED 9,523.81 net, not AED 500. Taking 5 per cent of the gross is the single most common arithmetic error on UAE invoices.
- When do I have to register for VAT in the UAE?
- Registration is mandatory once taxable supplies and imports exceed AED 375,000 in the previous twelve months or are expected to exceed it in the next thirty days. Voluntary registration is possible from AED 187,500. Non-resident businesses making taxable supplies in the UAE have no threshold at all.
- How should VAT be rounded on an invoice?
- Article 61 of the Executive Regulation allows rounding to the nearest fils using mathematical rounding, meaning two decimal places rounded up from a half. On a full tax invoice the VAT is rounded per line item, on a simplified invoice it is rounded on the total. Mixing the two within one document is what causes the mismatches auditors pick up.
- What is the reverse charge and does it cost me anything?
- When you buy services from a supplier outside the UAE you account for the VAT yourself, declaring it as output tax and recovering it as input tax in the same return. For a fully taxable business the two cancel out and no money moves. It still has to appear in the return, and leaving it out is a reporting error even though the net effect is zero.
- Is zero-rated the same as exempt?
- No, and the difference matters. Zero-rated supplies are taxable at 0 per cent, so you can still recover the input tax attributable to them. Exempt supplies carry no VAT and block input tax recovery. Treating an exempt supply as zero-rated overstates recoverable input tax and is a frequent cause of FTA assessments.
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