UAE VAT CalculatorCalculate VAT Online Fast
Use Entityz simple VAT calculator online. Simply enter the gross sum, choose your VAT calculation operation (include or exclude), and get instant results for UAE's 5% VAT rate.
VAT Calculator
UAE Standard Rate: 5%
How to Calculate VAT in UAE
Understanding VAT calculations is essential for every business operating in the UAE. The standard VAT rate is 5%.
Total Price Including VAT
The standard rate of 5% applies to most goods and services in the UAE. To work out the total price at the standard rate of VAT, multiply the original price by 1.05.
Formula
Total = Price x 1.05
Example: AED 1,000 x 1.05 = AED 1,050
VAT amount = AED 50
Total Price Excluding VAT
To calculate the price excluding the standard VAT rate of 5%, divide the VAT-inclusive total by 1.05. This gives you the net price before tax.
Formula
Net = Total / 1.05
Example: AED 1,050 / 1.05 = AED 1,000
VAT amount = AED 50
VAT Registration in the UAE
Value Added Tax (VAT) is a tax on the consumption or use of goods and services. A VAT of 5 per cent is levied at the point of sale. Businesses collect and account for the tax on behalf of the government. Learn how to register for VAT and how to file VAT returns in the UAE.
How is VAT Collected?
- VAT-registered businesses collect the amount on behalf of the government; consumers bear the VAT in the form of a 5% increase in the cost of taxable goods and services they purchase in the UAE.
- UAE imposes VAT on tax-registered businesses at a rate of 5% on a taxable supply of goods or services at each step of the supply chain.
- Tourists in the UAE also pay VAT at the point of sale.
VAT Registration Requirements
Mandatory Registration Threshold
AED 375,000
Annual taxable supplies
Voluntary Registration Threshold
AED 187,500
Annual taxable supplies
Standard VAT Rate in UAE
5%
Effective since January 1, 2018
How VAT Works in the UAE Supply Chain
Understanding how VAT flows through the supply chain helps businesses manage their tax obligations effectively.
Farmer/Producer
A farmer grows dates, which are picked and sold to a processing factory
Collects VAT from factory on behalf of government
Factory
The factory processes dates into date syrup, sold to retail chains
Collects VAT from retailer, gets refund on VAT paid to farmer
Retailer
The retailer places date syrup on shelves for sale to consumers
Collects VAT from consumer, gets refund on VAT paid to factory
Consumer
Consumer purchases bottle of date syrup with 5% VAT included
Bears the final VAT cost as end consumer
VAT Implications for Businesses
Businesses are responsible for carefully documenting their income, costs, and associated VAT charges.
Charge VAT
Must charge VAT on taxable goods or services they supply to customers at the prevailing 5% rate. Registered businesses and traders will charge VAT to all of their customers.
Reclaim VAT
May reclaim any VAT they have paid on business-related goods or services from suppliers. The difference between VAT charged and VAT paid is reclaimed or paid to the government.
Keep Records
Must keep a range of business records which will allow the government to check that they have got things right. Reporting is done online through the FTA portal.
VAT Reporting & Filing
VAT-registered businesses must report the amount of VAT they have charged and the amount of VAT they have paid to the government on a regular basis. It will be a formal submission and reporting will be done online.
- If VAT charged > VAT paid = Pay the difference to government
- If VAT paid > VAT charged = Reclaim the difference
VAT in GCC
The UAE coordinates VAT implementation with other GCC countries because it is connected with them through 'The Economic Agreement between the GCC States' and 'The GCC Customs Union', ensuring consistent trade practices across the region.
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