VAT Services in Dubai
DirhamWise provides VAT services in Dubai for SMEs and startups that would rather hand the compliance cycle to a firm than keep it in-house. Our VAT consultants in Dubai file your returns, review what has already been filed, support you through a Federal Tax Authority audit and set out your penalty exposure under the rules that changed in 2026.
We work from ParkLane Tower, Park Regis, Business Bay, Dubai, Monday to Saturday, 9:00am to 6:00pm. To book a VAT review, call +971 56 500 6694 or email info@dirhamwise.com. Every engagement starts with a written scope and a fixed fee agreed up front.
VAT services in Dubai: what our VAT consultants handle
“What does a VAT consultant do” has a different answer at every firm, so here is ours. Anything outside this table is quoted in writing, not added quietly to an invoice.
| Service | What you get | Who it is for |
|---|---|---|
| VAT return preparation and filing | A fixed data cut-off, output and input tax reconciled to your ledgers, a review before submission, filing on EmaraTax and a payment reminder | Any VAT-registered business |
| VAT health check | A fixed-scope review of filed returns and source documents, with a written report on each exposure found | Businesses that have filed for a year without an independent review |
| FTA audit support | Reconciliations, invoice and credit note samples, reverse-charge documents, and drafted responses to FTA requests | Businesses that have received an audit notice or an FTA query |
| Voluntary disclosures | The tax difference quantified, a decision between a disclosure and a next-return correction, and the submission prepared | Businesses that have found an error in a filed return |
| Penalty review | The penalties showing on your EmaraTax account explained, and the charges set against the schedule in force since 14 April 2026 | Businesses carrying penalties on EmaraTax |
| VAT registration | Threshold testing and the application: mandatory above AED 375,000 of taxable supplies and imports, voluntary above AED 187,500 | New or growing businesses. See VAT registration in the UAE |
| VAT deregistration | Eligibility check, final return and the application, filed inside the statutory window | Businesses that have ceased taxable supplies. See VAT deregistration |
| E-invoicing readiness | Invoicing data reviewed against the structured e-invoicing format, and a plan for appointing an Accredited Service Provider in time | Businesses issuing B2B or B2G invoices, not only VAT registrants |
VAT returns filed for you
VAT returns and the related payment are due within 28 days of the end of the tax period, both on EmaraTax. The standard tax period is quarterly; businesses with annual turnover of AED 150 million or more file monthly. For a quarterly filer on calendar quarters, that gives four fixed dates.
| Tax period ends | Return and payment due |
|---|---|
| 31 March | 28 April |
| 30 June | 28 July |
| 30 September | 28 October |
| 31 December | 28 January |
Your own quarters may be staggered; it is the 28-day rule that matters, not the calendar. We set a data cut-off about two weeks before your due date, reconcile output and recoverable input tax to your ledgers, check reverse-charge entries against their supporting documents, send you the draft with the working, file on your approval, and remind you to pay. Filing on time and paying late still triggers the late-payment charge, so the payment date is the deadline we work to.
What we ask you for is the same every period:
| What we need | Why it matters on the return |
|---|---|
| Sales invoices and credit notes issued in the period | Output tax, and credit notes landing in the correct period |
| Purchase invoices showing the supplier’s TRN | Input tax is only recoverable where the document supports it |
| Import documentation | Imports and reverse-charge entries must agree with the customs position |
| Supporting documents for reverse-charge supplies | Self-invoices are no longer issued, so these documents are the evidence |
| Evidence for zero-rated or exempt treatment | The treatment stands or falls on the evidence held |
| Bank statements and the trial balance for the period | The return is reconciled to the books, not prepared beside them |
VAT compliance bundled with your bookkeeping
Many VAT errors start as bookkeeping errors and only surface in a return: an invoice posted without a TRN, a credit note never recorded, an import treated as a zero-rated purchase. When one team keeps the books and prepares the return, tax coding is settled at the point of entry rather than argued over at quarter-end. That is why we usually propose VAT alongside our accounting and bookkeeping services in Dubai, and our corporate tax consultant team works from the same accounts.
UAE VAT penalties in 2026 (Cabinet Decision 129/2025)
Cabinet Decision 129/2025 amends Cabinet Decision 40/2017. Issued on 9 October 2025, it came into force on 14 April 2026, replacing the earlier late-payment structure of 2% immediately, 4% after seven days and 1% daily, capped at 300%. It applies to VAT, excise tax and the Tax Procedures Law, but not to corporate tax, which keeps its own schedule under Cabinet Decision 75/2023.
| Violation | Penalty | Note |
|---|---|---|
| Late payment of tax | 14% per annum, charged monthly | Replaces the old percentage scheme and its cap |
| Late submission of a VAT return | AED 1,000 | AED 2,000 if repeated within 24 months |
| Late VAT registration | AED 10,000 | One-off |
| Late VAT deregistration | AED 1,000 per month | Capped at AED 10,000 |
| Failure to keep the required records | AED 10,000 | AED 20,000 if repeated |
| Failure to update information on the tax record | AED 1,000 | AED 5,000 if repeated |
| Documents not submitted in Arabic when requested | AED 5,000 | Records and data requested by the FTA |
| Incorrect return | AED 500 | Not applied if corrected by the submission deadline, or by a disclosure with no tax difference |
| Voluntary disclosure of a tax difference | 1% per month on the tax difference | The cheaper route, if made before an audit notice |
| No voluntary disclosure before an FTA audit notice | 15% fixed, plus 1% per month | The expensive route |
| Obstructing an FTA tax auditor | AED 20,000 | Includes withholding required access or assistance |
| Failure to issue a tax invoice or tax credit note | AED 2,500 | Per case |
Two things follow. The late-payment charge is time-based rather than front-loaded, so it accrues for as long as the tax is unpaid instead of stepping up in the first week. And the gap between a disclosed difference at 1% per month and an undisclosed one at 15% plus 1% per month is one of the few VAT numbers still within your control once an error exists.
What changed in UAE VAT in 2026
Four dates in 2026 matter to a VAT-registered SME.
| Date | Instrument | What it changes |
|---|---|---|
| 1 January 2026 | Federal Decree-Law 16/2025 (VAT) and 17/2025 (Tax Procedures) | Reverse-charge self-invoicing removed; 5-year limit on credit balances; input tax denied in evasion chains; FTA may issue binding directives |
| 1 April 2026 | Tax Procedures Executive Regulation amendments | Reported AED 10,000 voluntary disclosure threshold; extra record retention where a refund claim is unresolved |
| 14 April 2026 | Cabinet Decision 129/2025 | The penalty schedule above, including the 14% per annum late-payment charge |
| 1 October 2026 | Cabinet Decision 149/2026 | VAT Executive Regulation amendments: cash payments, employee accommodation, composite supplies, medical products, capital assets, apportionment |
1 January 2026: FDL 16/2025 and FDL 17/2025
Two decree-laws took effect on 1 January 2026: Federal Decree-Law 16/2025 amending the VAT Law and Federal Decree-Law 17/2025 amending the Tax Procedures Law. Four changes affect ordinary SME compliance.
- Reverse-charge self-invoices are no longer issued. Supporting documents must still be kept, so the paperwork has moved rather than gone, and a reverse-charge entry with nothing behind it is the weakest point in most VAT files.
- A five-year limit on credit balances. Excess refundable tax or a credit balance must be claimed or used within five years of the end of the tax period it relates to, so a balance left on EmaraTax as a buffer is a wasting asset.
- Input tax denied in evasion chains. Input tax must be denied where the supply formed part of an evasion chain the taxpayer knew, or should have known, about — which makes supplier due diligence a recovery question.
- Binding directives. The FTA can now issue binding directives, which changes how quickly a published position becomes enforceable.
Old VAT credit balances: claim by 31 December 2026
The five-year limit comes with a transitional rule and a hard end date. Where the five-year period expired before 1 January 2026, or expires within one year after it, the refund request may still be made within one year of 1 January 2026 — in practice 31 December 2026. It affects balances from roughly 2018 to 2020.
If you registered early in the VAT era, there may be a balance on your EmaraTax account that stops being claimable at the end of this year — the one deadline here that cannot be met retrospectively. Call +971 56 500 6694 to have your old VAT credits checked before 31 December 2026.
1 April 2026: Tax Procedures Executive Regulation amendments
The Ministry of Finance announced amendments to the Tax Procedures Executive Regulation (Cabinet Decision 74/2023) with effect from 1 April 2026. The mechanics below, including the AED 10,000 figure, come from professional advisers’ published analysis rather than from the announcement text, so treat them as the working position and not as a settled reading.
- A tax difference above AED 10,000 requires a voluntary disclosure within 20 business days of becoming aware of it.
- A tax difference of AED 10,000 or less can be corrected in the next return instead.
- Records connected to an unresolved refund or credit-balance claim are kept two years beyond the normal retention period.
- Refund procedures apply to all credit balances.
1 October 2026: VAT Executive Regulation amendments (CD 149/2026)
Cabinet Decision 149/2026 amends the VAT Executive Regulation (Cabinet Decision 52/2017). It was issued on 1 September 2026 and generally takes effect on 1 October 2026. The detail below comes from press coverage rather than a published consolidated text, so read it as direction of travel.
- Cash payments. Input tax is blocked where a supply above a threshold set by the Minister is paid, or intended to be paid, in cash. No threshold figure has been set, so any firm quoting one is guessing. What you can do now is identify which purchases you settle in cash.
- Employee accommodation. How staff accommodation and the related input tax are treated.
- Composite supplies. Taxed according to economic substance rather than contractual packaging.
- Medical products. Zero-rating re-aligned to newer health legislation.
- Capital Assets Scheme. Its scope is revised.
- Input tax apportionment. Revised apportionment applies from the first tax year starting after 1 October 2027.
E-invoicing is next
Businesses with revenue below AED 50 million must appoint an Accredited Service Provider by 31 March 2027 and go live by 1 July 2027; businesses at or above AED 50 million appoint by 30 October 2026 and go live by 1 January 2027. The obligation covers any person conducting business in the UAE, not only VAT registrants, and invoices must be exchanged as structured data rather than PDFs.
Voluntary disclosures and VAT penalty reviews
Finding an error in a filed return is not, in itself, expensive. Handling it badly is. On the reported reading of the April 2026 amendments, the question now splits in two.
| Situation | What is required | Cost |
|---|---|---|
| Tax difference of AED 10,000 or less | Correct it in the next VAT return rather than by voluntary disclosure | No voluntary disclosure is made, so the 1% per month charge does not arise on that route |
| Tax difference above AED 10,000 | Voluntary disclosure within 20 business days of becoming aware | 1% per month on the tax difference |
| Error left undisclosed until the FTA issues an audit notice | The window for disclosing before the notice has closed | 15% fixed, plus 1% per month |
The work itself is unglamorous: establish which period the error belongs to, quantify the difference period by period rather than as one lump, check whether it crosses the AED 10,000 line, and prepare the submission with the working attached. Where a penalty has already been imposed and you want it reconsidered, that is a separate process before the FTA, and we will tell you whether a case exists rather than promise an outcome.
FTA VAT audit support
An FTA VAT audit is a document exercise, and the outcome usually turns on whether the records behind your filed numbers exist in retrievable form.
| Typically requested | What we prepare |
|---|---|
| Return workings for the periods under review | Each return reconciled to the trial balance |
| Sales and purchase listings | Listings tied back to the figures filed |
| Tax invoices and credit notes, on a sample basis | Samples reviewed for required particulars first |
| Import documentation | Customs entries agreed to the reverse-charge entries reported |
| Reverse-charge supporting documents | Documents assembled period by period, now that self-invoices are not issued |
| Evidence for zero-rated or exempt treatment | Evidence tested against the treatment applied, gaps flagged |
Where we find exposure better disclosed than discovered, we say so and set out the disclosure route before responding. The penalties that bite during an audit are procedural rather than technical:
| Audit-related failure | Penalty |
|---|---|
| Failure to keep the required records | AED 10,000, or AED 20,000 if repeated |
| Documents not provided in Arabic when requested | AED 5,000 |
| Obstructing an FTA tax auditor | AED 20,000 |
| Missing tax invoice or tax credit note | AED 2,500 per case |
None of those depend on whether the VAT treatment was right. They are about records and cooperation — the part you can prepare for in advance.
VAT health check
A VAT health check is a fixed-scope review with a written deliverable, not an open-ended retainer. We agree the periods and the fee before starting, and you receive a report listing each exposure, its value where it can be quantified, and the action we recommend. Businesses ask for one before an expected audit or after a change of finance staff. It covers:
- Input tax recovery — whether recoverable input tax was recovered, and whether blocked input tax was claimed in error.
- Reverse-charge documentation after 1 January 2026 — the most common gap since self-invoicing was removed. The entries are usually there; the documents often are not.
- Credit notes — whether issued notes fall in the right period and received ones were processed.
- Tax invoice completeness — invoices missing required particulars, given the AED 2,500 per case exposure.
- Cash-paid purchases — ahead of the input tax restriction from 1 October 2026.
- Credit balances near the five-year limit — including anything inside the 31 December 2026 window.
- Zero-rated and exempt treatments — whether the evidence held supports them.
UAE VAT rate: 5%, zero-rated and exempt supplies
The UAE VAT rate is 5%. It is a federal consumption tax administered by the Federal Tax Authority, at the same rate across all seven emirates. Alongside it sit two other categories, and the difference between them decides whether you recover your input tax.
| Category | VAT charged on your sale | Input tax on related costs |
|---|---|---|
| Standard-rated | 5% | Recoverable |
| Zero-rated | 0% — still a taxable supply, still reported on the return | Recoverable |
| Exempt | No VAT charged | Not recoverable |
Zero-rated and exempt look similar on an invoice and behave in opposite ways on a return. A zero-rated supplier charges nothing but still recovers VAT on its costs, and often sits in a repayment position. An exempt supplier cannot recover the VAT attributable to those supplies, so it becomes a real cost. A business doing both must apportion its input tax, and Cabinet Decision 149/2026 revises that apportionment from the first tax year starting after 1 October 2027.
Which goods and services fall into each category is set out on the Federal Tax Authority’s own VAT topic pages at tax.gov.ae, and that is the place to check rather than any consultant’s summary, including ours. Where your supplies sit close to a boundary, we give you a written view and tell you what evidence you need to hold.
VAT consultants for Sharjah and the other emirates
VAT is a federal tax. The law, the rate, the return, the deadlines and the penalties are identical whether your trade licence was issued in Dubai, Sharjah, Ajman or Abu Dhabi, and everything is filed on the same EmaraTax portal. If you are looking for VAT consultants in Sharjah, the service described on this page is the same one you need, and we deliver it from our Business Bay office. We do not maintain offices outside Dubai.
How it works
- Call or email. Tell us your tax period, turnover band and any open FTA matters, on +971 56 500 6694 or info@dirhamwise.com.
- We review your last return and your EmaraTax account. Those two show us the penalties sitting on the account and any credit balance nearing its limit.
- A written fixed quote and a filing calendar. The quote states scope and fee before work starts; the calendar gives the cut-off, review and filing dates for each period ahead.
- We prepare, you approve, we file. You see the draft figures and the working before anything is submitted, and get a payment reminder before the due date.
Why SMEs choose DirhamWise
- Published prices. Our monthly accounting packages are AED 950, AED 1,650 and AED 2,150. We confirm in writing which VAT work a package covers and quote anything beyond it as a fixed fee.
- Scope in writing. You know what is included, what is not, and what it costs.
- A Dubai office you can visit. ParkLane Tower, Park Regis, Business Bay.
- Saturday cover. Monday to Saturday, 9:00am to 6:00pm — useful in the week a return is due.
- One team for the whole ledger. VAT, bookkeeping and corporate tax run off the same accounts.
- No promises about outcomes. We tell you what the rules say and what your exposure looks like. We do not predict what a tax authority will decide.
Frequently asked questions
What does a VAT consultant in Dubai do?
A VAT consultant files your returns on EmaraTax, reviews returns already filed, handles voluntary disclosures when an error is found, supports you through an FTA audit, reviews your penalty position, and manages registration and deregistration. The scope table above sets out what we cover.
What is VAT in the UAE?
VAT is a 5% federal consumption tax on most goods and services, administered by the Federal Tax Authority. Registered businesses charge it on taxable supplies, recover it on business costs where recovery is allowed, and report both on EmaraTax.
When is the UAE VAT return due?
Both the return and the payment are due within 28 days of the end of the tax period. The standard period is quarterly, so a quarter ending 31 March is due by 28 April. Annual turnover of AED 150 million or more means monthly filing.
What is the penalty for late filing of a VAT return in the UAE?
AED 1,000 for a late return, rising to AED 2,000 if repeated within 24 months, under Cabinet Decision 129/2025 and in force since 14 April 2026. The late-payment charge on the tax is separate and runs in addition.
What is the VAT late payment penalty in the UAE?
14% per annum, charged monthly on the unpaid tax, with effect from 14 April 2026. It replaced a scheme of 2% immediately, 4% after seven days and 1% daily capped at 300%, so the charge now accrues with time rather than stepping up in the first week.
Is there a penalty for a voluntary disclosure in UAE VAT?
Yes — 1% per month on the tax difference. The alternative is worse: if the error is not disclosed before the FTA issues an audit notice, the charge is a fixed 15% plus 1% per month.
Can I claim VAT on old invoices in the UAE?
Since 1 January 2026, excess refundable tax or a credit balance must be claimed or used within five years of the end of the tax period it relates to. Balances whose five-year period expired before 1 January 2026, or expires within one year after it, can still be claimed until 31 December 2026 — those from roughly 2018 to 2020.
How do businesses claim a VAT refund in the UAE?
A business in a repayment position claims its excess refundable tax through EmaraTax, within the five-year window above. The claim rests on the return working and the underlying records, which the FTA may ask to see before releasing the refund.
How do I pay VAT online in the UAE?
VAT is paid through EmaraTax, and the payment carries the same 28-day deadline as the return. Filing on time but paying late still triggers the late-payment charge, so we treat the payment date as the deadline that matters.
Do you provide VAT services for businesses in Sharjah?
Yes. VAT is federal, so the rules, the return and the deadlines are the same in Sharjah as in Dubai. We serve Sharjah clients from our Business Bay office in Dubai.
What changes to UAE VAT take effect on 1 October 2026?
Cabinet Decision 149/2026 amends the VAT Executive Regulation from 1 October 2026: an input tax block on supplies above a threshold paid in cash, employee accommodation, composite supplies taxed on economic substance, medical-product zero-rating, the Capital Assets Scheme, and revised apportionment from the first tax year starting after 1 October 2027. The cash threshold has not been set, so no figure should be quoted yet.
Book a VAT review
Send us your last VAT return and we will tell you what we find: filing gaps, missing reverse-charge documents, credit balances running out of time, and your penalty position under the rules in force since April 2026. Call +971 56 500 6694, email info@dirhamwise.com or use our contact page. We are at ParkLane Tower, Park Regis, Business Bay, Dubai, Monday to Saturday, 9:00am to 6:00pm.