UAE VAT Calculator
Calculate VAT with different rates per item - Standard, Zero-rated, and Exempt
VAT Breakdown
Totals
How VAT Is Added to a Price, and How It Is Taken Back Out
Adding VAT and removing VAT use two different sums, and mixing them up is the most common VAT mistake. To add 5% VAT to a price that does not yet include it, multiply by 1.05. To find the price before VAT inside a total that already includes it, divide by 1.05. Multiplying a VAT-inclusive total by 1.05 again overcharges the customer, and dividing a VAT-exclusive price by 1.05 undercharges it.
Adding VAT to a price
A product priced at AED 200 before VAT costs AED 210 once VAT is added: 200 × 1.05 = 210. The VAT itself is AED 10, which is also 200 × 0.05.
Removing VAT from a total
A receipt showing a total of AED 2,100 has a pre-VAT price of AED 2,000: 2,100 ÷ 1.05 = 2,000. The VAT included in that total is AED 100, the difference between the two.
The second case, working backward from a total to find the VAT hidden inside it, is what people usually mean when they say "reverse VAT" or ask how much of a total is VAT. It comes up whenever you only have the final amount, such as a receipt, a bank statement line, or a supplier's all-in quote, and need to know the taxable value and VAT amount separately.
Standard-Rated, Zero-Rated and Exempt Supplies in the UAE
UAE VAT sorts every supply into one of three categories, and which one applies changes both the rate you charge and whether you can claim back the VAT you paid on the costs behind it.
| Category | UAE examples | Rate charged |
|---|---|---|
| Standard-rated | Electronics, clothing, restaurant meals, hotel stays, telecom, most professional services | 5% |
| Zero-rated | Exports of goods and services, international transport, healthcare, education, first sale of new residential property within 3 years | 0% |
| Exempt | Certain financial services, residential property rent after the first sale, bare land, local passenger transport | No VAT charged |
The difference matters most for input VAT, the VAT you pay on your own purchases and expenses. On zero-rated supplies you charge 0% but can still claim back the VAT on the costs behind them. On exempt supplies you charge no VAT and also cannot claim back the VAT on related costs. Mixing the two up understates or overstates how much VAT a business can recover. For how this plays out line by line on an actual bill, read VAT invoice calculation in the UAE.
Four Worked AED Examples
A shop prices a phone case at AED 45 before VAT.
VAT: 45 × 0.05 = AED 2.25
Price with VAT: 45 × 1.05 = AED 47.25
A customer receipt shows a total of AED 2,100, VAT included.
Price without VAT: 2,100 ÷ 1.05 = AED 2,000
VAT included: 2,100 − 2,000 = AED 100
A consultant bills a client AED 8,000 for a month of work, standard-rated.
VAT: 8,000 × 0.05 = AED 400
Total on the invoice: 8,000 × 1.05 = AED 8,400
An invoice has a training session at AED 1,200 (standard, 5%) and an export shipping fee at AED 600 (zero-rated, 0%).
VAT on the training line: 1,200 × 0.05 = AED 60
VAT on the shipping line: 600 × 0 = AED 0
Grand total: 1,200 + 600 + 60 = AED 1,860
The calculator above works the same way: each line item carries its own rate, and the totals add up across all of them. Build the same line items there to check an actual invoice, or use the invoice generator to turn the result into a document you can send.
Common Mistakes With 5% VAT
- Treating a VAT-inclusive total as the net price: adding 5% on top of an amount that already includes VAT overcharges the customer. Check whether a number is already VAT-inclusive before doing anything to it.
- Rounding per line instead of per invoice: rounding the VAT on each line item and then adding the rounded amounts up can land on a different total than rounding the invoice once at the end. Pick one method and use it consistently across an invoice.
- Forgetting that UAE retail prices are shown VAT-inclusive: a shelf price of AED 105 already includes AED 5 of VAT on a net price of AED 100. That is not an extra charge added at checkout.
- Mixing up zero-rated and exempt: both charge no VAT to the customer, but only zero-rated supplies let you claim back the VAT on your own related costs. Treating an exempt supply as zero-rated overstates the input VAT a business can recover.
This calculator handles the arithmetic. It is not tax filing software and does not give legal advice. For your specific registration, filing, or input VAT position, talk to a registered tax agent, or check your net position with the corporate tax calculator.
Frequently Asked Questions
What is the VAT rate in the UAE?
The standard VAT rate in the UAE is 5%. It applies to most goods and services, under Federal Decree-Law No. 8 of 2017 and its Executive Regulation. A small number of supplies are zero-rated or exempt instead, which this page covers below.
How do I add VAT to a price?
Multiply the price before VAT by 1.05. A product priced at AED 200 before VAT costs AED 210 once VAT is added, because 200 x 1.05 = 210. The AED 10 difference is the VAT.
How do I remove VAT from a total (reverse VAT)?
Divide the total by 1.05 to get the price before VAT. A receipt showing AED 2,100 has a pre-VAT price of AED 2,000, because 2,100 / 1.05 = 2,000. The VAT included in that total is AED 100.
What items are zero-rated?
Exports of goods and services, international transport, healthcare services, education services, and the first sale of a newly constructed residential property within 3 years. Zero-rated supplies are taxed at 0%, not exempt from VAT entirely.
What items are VAT exempt?
Certain financial services, residential property rent after the first sale, bare land sales, and local passenger transport. No VAT is charged on these, and none is claimed back on the costs behind them either.
Can I claim input VAT on exempt supplies?
No. Businesses cannot claim input VAT on expenses related to making exempt supplies. This is different from zero-rated supplies, where input VAT can still be claimed even though the output rate is 0%.
What is the VAT registration threshold?
Mandatory registration applies once a business's taxable supplies and imports pass AED 375,000 in a 12-month period. Voluntary registration is available from AED 187,500. Talk to a registered tax agent about your specific registration position.