1. Real Estate Guidance
1.1 Overview
1.1.1 Short brief
VAT was introduced on 1 January 2018 in the UAE. As a general consumption tax on the supply of goods and services, its effects are applicable to supplies of real estate made in the UAE.
1.1.2 Purpose of this document
This document contains guidance about the VAT treatment of supplies of real estate, as well as various common transactions which occur within the real estate sector.
The purpose of this document is to provide guidance on how VAT affects businesses which operate within the real estate sector, as well as for owners or landlords of real estate.
1.1.3 Who should read this document?
This document should be read by owners of commercial and residential real estate, landlords making supplies of commercial or residential real estate, and businesses operating within the construction industry, or making supplies which relate to real estate. Property managers and owners’ associations may also find this guide useful.
It is intended to be read in conjunction with other relevant guidance published by the Federal Tax Authority (“FTA”).
1.1.4 Status of the document
This guide is issued in accordance with Article 73 of the Executive Regulations and provides general guidance concerning the application of the Decree-Law and Executive Regulations in respect of real estate in the United Arab Emirates. This guide does not deal with all the legal detail associated with VAT and is not intended for legal reference. For details in respect of the general operation of VAT, refer to the Taxable Person Guide – Value Added Tax which is available on the Federal Tax Authority (FTA) website (www.tax.gov.ae).
In this guide, Federal Decree-Law No. 8 of 2017 on Value Added Tax is referred to as “Decree-Law” and Cabinet Decision No. 52 of 2017 on the Executive Regulations of the Federal Decree-Law No. 8 of 2017 on Value Added Tax is referred to as “Executive Regulations”. This guidance is not legally binding on the FTA but is intended to provide assistance in understanding and applying the VAT legislation as it applies to real estate.
Download the complete Real Estate VAT Guide – VATGRE1 Apr 2021