Key takeaways
- Mandatory registration: taxable supplies and imports over AED 375,000.
- Voluntary registration: supplies, imports or taxable expenses over AED 187,500.
- The test looks back at past turnover and forward at expected turnover.
- VAT is 5%; once registered you charge it, file returns and recover eligible input VAT.
- Since 1 January 2026, excess VAT refunds must be claimed within five years.
The two thresholds
| Your turnover | VAT position |
|---|---|
| Taxable supplies and imports over AED 375,000 | Registration is mandatory |
| Supplies, imports or taxable expenses over AED 187,500 | Registration is voluntary |
| Below AED 187,500 | Registration isn't available |
The test isn't only your year-end figure. It looks back at what you've already made and forward at what you expect soon, so a new contract can make registration mandatory early.
Should a small business register voluntarily?
- Often yes if most customers are VAT-registered businesses, who can recover the VAT you charge.
- Often yes for new companies with heavy start-up costs, which can recover VAT on them once registered.
- Often no if you sell mainly to consumers, who can't recover VAT, so registering may raise your prices.
Registration adds returns and record-keeping, so weigh the admin as well as the tax.
Documents for a VAT application
- Trade license.
- Passport and Emirates ID copies for owners and the signatory.
- Proof of the signatory's authority.
- Memorandum of association or equivalent.
- Company contact and bank details.
- Evidence of turnover or expected turnover: invoices, contracts, purchase orders or a forecast.
- A customs registration number if you import goods.
What registration commits you to
Once the FTA issues your TRN, invoices must show it and charge VAT correctly, a return is due for each tax period the FTA sets, and changes to your company details must be reported. Under the 2026 amendments, businesses no longer self-invoice under the reverse charge but must keep supporting documents, and refund claims expire after five years. If turnover falls, deregistration has its own rules; see FTA services.
Why applications get sent back
- Names spelt differently across the license, passport and Emirates ID.
- An expired license or Emirates ID on the day of submission.
- Turnover figures that don't match the invoices or accounts attached.
- No document showing the signatory's authority.
- Missing customs details for an importer.
- Blurred scans or password-protected files.
We prepare the evidence and the EmaraTax application and reply quickly to FTA questions. See VAT registration.
Sources
- Federal Tax Authority: registration for VAT
- Ministry of Finance: VAT law amendments from January 2026
Official sources checked on 7 November 2026. This guide explains published rules in plain English and is not legal or tax advice. Rules change; we check the current position for your case before you act.