How VAT will be Imposed in the Real Estate Sector

Updated on Thursday 23rd November 2017

How VAT will be Imposed in the Real Estate Sector Image
The VAT Law which was planned a few years ago was finally accepted and published. Therefore, starting with January 2018, numerous goods and services will be displayed with a new tax, in this case, the VAT. Also, the real estate sector will suffer changes from a taxation point of view. In order to understand how rules are going to be applied starting next year, you can address to our Dubai accountants.  Our team of accountants can offer complete support in all taxation matters.

How residential properties in Dubai will be taxed in 2018

From the beginning, we mention that the first purchases or property rentals in Dubai will not be subject to VAT, no matter if a resident, a foreigner or a company is interested in such transactions. For any subsequent residential purchases or leases, the VAT of 5% rate will be imposed. Also, it is good to know that land plots in Dubai which are for rent or for sale for the first time, meaning that there is no sales history behind, will not suffer price changes by adding the VAT.

How commercial properties in Dubai will be levied the VAT in 2018

Businessmen should know that the commercial properties in Dubai will be subject to a VAT rate of 5% which is going to be added to the price of rent or purchase and paid by commercial owners and customers. One should know that if the rental period lengths to January 2018, the VAT will be allocated on that month and it is going to be paid accordingly.

In matters of accounting for your company in Dubai, you can solicit help from our team of Dubai accountants. Furthermore, companies need audits in Dubai which can also be offered by our advisors who have a wide experience in this field.

Other services subject to VAT in Dubai

Once the VAT will be imposed on certain properties in Dubai starting next year, it is good to know that the services included, such as cleaning, or the utility bills will also comprise the VAT tax rate of 5%.

Complete clarifications in VAT matters in the UAE can be solicited from our accounting firm in Dubai, if you contact us.