UAE VAT Calculator
Updated August 2026 · Based on UAE Federal Tax Authority (FTA) rules
Add 5% VAT to a net price, or remove the VAT already included in a gross price — instantly.
Quick answer
UAE VAT is a 5% tax on most goods and services, in force since 1 January 2018. To add VAT, multiply the net price by 1.05. To remove VAT from a VAT-inclusive price, divide it by 1.05 — the VAT element is the gross price minus the net.
| To calculate | Formula |
|---|---|
| Add VAT to a net price | Net × 1.05 = Gross |
| VAT amount on a net price | Net × 0.05 |
| Remove VAT from a gross price | Gross ÷ 1.05 = Net |
| VAT contained in a gross price | Gross − (Gross ÷ 1.05), or Gross × 1/21 |
| VAT payable to the FTA | Output VAT − recoverable input VAT |
How is UAE VAT calculated?
The UAE applies a standard 5% VAT rate, introduced on 1 January 2018 under Federal Decree-Law No. 8 of 2017 and administered by the Federal Tax Authority (FTA). There are two directions of travel:
- Adding VAT to a price quoted net: VAT = net × 5%, and gross = net + VAT.
- Removing VAT from a price that already includes it: net = gross ÷ 1.05, and VAT = gross − net.
The second is where most errors happen. Subtracting 5% from a VAT-inclusive figure gives the wrong answer, because the 5% was charged on the smaller net amount. As a fraction of the gross price, the VAT element is 1/21, or about 4.7619% — not 5%.
Worked example 1 — adding VAT to a quotation
A net quote of AED 12,400
VAT = 12,400 × 0.05 = AED 620
Total payable = 12,400 + 620 = AED 13,020
Worked example 2 — extracting VAT from a receipt
A VAT-inclusive receipt for AED 262.50
Net = 262.50 ÷ 1.05 = AED 250.00
VAT = 262.50 − 250.00 = AED 12.50
Doing it the wrong way shows the size of the error: 262.50 × 5% = AED 13.13, which overstates the VAT.
Do you have to register for VAT?
| Registration | Threshold |
|---|---|
| Mandatory | AED 375,000 of taxable supplies and imports |
| Voluntary | AED 187,500 of taxable supplies, or taxable expenses |
What you actually pay
The figure that reaches the FTA is not the VAT on your sales. It is output VAT less recoverable input VAT for the same tax period. Where input VAT exceeds output VAT, the result is a refundable credit.
Returns and payment are due within 28 days of the end of the tax period. The FTA assigns each business its tax period, monthly or quarterly; your assigned period is shown on your FTA registration.
Not everything is taxed at 5%
Some supplies are zero-rated (taxable at 0%) and others are exempt. Both mean no VAT is charged to the customer, but the recovery position differs: input VAT on costs relating to zero-rated supplies can generally be recovered, while input VAT attributable to exempt supplies generally cannot. Confirm the treatment of your own supplies with the FTA or a registered tax agent before relying on it.
VAT invoices and UAE e-invoicing
The UAE is introducing mandatory e-invoicing in phases. Businesses with revenue of AED 50 million or more are required to exchange structured e-invoices from 1 January 2027, and to appoint an Accredited Service Provider by 30 October 2026. If you issue UAE tax invoices from an ERP or accounting system, our UAE e-invoicing guide covers the phases and what an Accredited Service Provider does.
Estimate for guidance only — this is not tax advice. Rates, thresholds and deadlines change, and the treatment of an individual supply depends on facts this page cannot see. Confirm the current position with the Federal Tax Authority or a registered tax agent before you rely on a figure.
Source: Federal Tax Authority (tax.gov.ae). Reviewed August 2026.
Frequently asked questions
Related UAE calculators and guides
Handling UAE business taxes? You may also need:
Automate VAT with Avance ERP
Avance ERP produces tax invoices in the FTA format and builds the VAT return figures from your own transactions, so output and input VAT reconcile without a spreadsheet. Book a free demo.
Book a Free Demo