VAT registration UAE: guide for newly registered companies

A new UAE company does not automatically need to register for VAT when it receives its trade licence. Registration depends mainly on the value and type of supplies and imports the business makes, or expects to make. The key figures are AED 375,000 for mandatory registration and AED 187,500 for voluntary registration.

This guide explains how the two threshold tests work, what to include in the calculation, the documents an EmaraTax application needs, and what a company is responsible for once it holds a Tax Registration Number (TRN).

Quick answer

You must register for VAT in the UAE once taxable supplies and imports exceed AED 375,000, tested over the previous 12 months or expected in the next 30 days. Voluntary registration is available from AED 187,500, tested the same way, and can be met through taxable supplies, imports or taxable expenses. A UAE-resident business that does not meet the voluntary threshold is generally not eligible to register based on the individual threshold test. Non-residents making taxable supplies in the UAE generally face no threshold.

Registration position	Threshold or condition	When to apply	What it means
Mandatory registration	Taxable supplies and imports exceed AED 375,000 over the previous 12 months or are expected to exceed it in the next 30 days	Within 30 days of becoming required to register	Registration is compulsory
Voluntary registration	The business does not meet the mandatory test, but taxable supplies, imports or taxable expenses exceed AED 187,500 over the previous 12 months or are expected to exceed it in the next 30 days	Once the voluntary test is met	Optional, but ongoing VAT obligations begin after registration
Below the voluntary threshold	The business does not meet either registration threshold	No application based on the individual threshold test	Generally not eligible to register on this basis
Non-resident business	Makes taxable supplies in the UAE and no other UAE party is responsible for settling the VAT	Check from the first relevant taxable supply	No AED threshold applies in this situation

Mandatory versus voluntary registration

Mandatory registration is not a judgement call. Cross AED 375,000 on either test and you are required to register within 30 days of meeting it.

Voluntary registration sits below that line, from AED 187,500. A business may consider voluntary registration where it has qualifying taxable expenses and wants to assess possible input-tax recovery, but recovery remains subject to the applicable VAT rules. That does not make it automatically the right move: once registered, you take on the same filing and record-keeping obligations as a mandatory registrant. Whether voluntary registration is appropriate depends on the company’s taxable activity, expenses, customers and readiness to manage ongoing VAT obligations.

VAT and UAE corporate tax are separate systems

VAT and UAE corporate tax are separate systems. VAT registration is assessed using taxable supplies, imports and the relevant VAT thresholds. UAE corporate-tax registration follows separate rules for taxable persons and should not be judged using the VAT thresholds. Registration for one tax does not register the business for the other.

How to calculate whether you have crossed the threshold

For UAE VAT registration, the FTA applies two threshold tests, and either one can trigger mandatory registration. The retrospective test looks backward over the previous 12 months, on a rolling basis. The prospective test looks forward: if you reasonably expect taxable supplies and imports in the next 30 days to exceed AED 375,000, you must register immediately.

Worked example

A company’s previous 12 months of standard-rated supplies total AED 310,000. Taxable imports over the same period add AED 40,000. For the retrospective test: AED 310,000 + AED 40,000 = AED 350,000. That is below the AED 375,000 mandatory threshold but above the AED 187,500 voluntary threshold, so the company could register voluntarily but is not yet required to.

The company then has confirmed orders expected to bring taxable supplies and imports of AED 390,000 within the next 30 days. AED 390,000 exceeds AED 375,000, so the prospective test is met and mandatory registration applies from that point, regardless of the lower retrospective figure.

This is an illustrative example, not individual tax advice. Check your own figures against current FTA guidance before relying on them.

What counts towards the threshold

The FTA measures the threshold against taxable supplies and imports, not total company revenue. Standard-rated supplies (the general 5% rate) count in full. Zero-rated supplies, such as most direct exports, are taxed at 0% but remain part of the taxable-supply framework, which is a different position from an exempt supply, such as specified financial services or most residential leasing. Because the exact category affects the calculation, confirm the classification of your own supplies against the FTA’s guidance on zero-rated and exempt supplies before finalising a decision.

VAT registration checklist for a newly registered company

1. Split the last 12 months of sales into standard-rated, zero-rated, exempt and out-of-scope — only taxable supplies count.
2. Add up taxable supplies and imports for the trailing 12 months against AED 375,000 and AED 187,500.
3. Check confirmed orders and contracts for taxable supplies and imports expected in the next 30 days.
4. Decide your position: mandatory (register within 30 days), voluntarily eligible, or below AED 187,500 with no action needed.
5. Gather your trade licence, certificate of incorporation and Memorandum or Articles of Association — the full list is in the company registration documents checklist.
6. Confirm your authorised signatory, with identification and a power of attorney if they are not an owner.
7. Prepare supporting invoices, contracts or other evidence for the turnover declared in the application.
8. Have UAE bank details ready if you already hold an account; see the UAE corporate bank account guide if not.
9. Prepare your invoicing system to apply the correct VAT treatment and display the TRN from the registration effective date.
10. Once approved, calendar your first return period and deadline.

How to apply through EmaraTax

VAT registration is completed online through EmaraTax, the FTA’s digital tax platform:

• Create or sign in to EmaraTax and set up a Taxable Person profile for the company.
• Start a VAT registration application and complete the sections on business details, trade licence and activity.
• Add your authorised signatory’s details and identification, plus a power of attorney if someone other than an owner is signing.
• Declare your turnover and attach supporting evidence.
• Add bank details if you have them; not always required to submit.
• Review and submit.

The FTA then reviews the application before issuing a TRN and registration certificate, which appear in your EmaraTax dashboard on approval. This assumes the company is already formed and licensed; if you are still working through that stage, the Dubai company setup step-by-step guide covers that sequence.

What happens after you register

Once registered, a few responsibilities follow:

• Follow the tax period shown on your FTA registration record.
• Issue tax invoices containing the required particulars where applicable.
• Apply the correct VAT treatment to each supply.
• Submit returns and pay any VAT due within 28 days of the end of each tax period.
• Retain appropriate records for FTA review.
• Update your registration details, such as trade licence or signatory changes, when required.

A registrant may later need to deregister, either because a mandatory trigger applies or by choice once eligible. The FTA’s deregistration service currently allows 20 business days to apply once a mandatory obligation arises. Check the current FTA service page for the exact conditions that apply to your situation.

Common mistakes to avoid

• Assuming a new trade licence means VAT registration is automatic — it depends on turnover, not on how recently the company was incorporated.
• Counting only standard-rated sales and leaving zero-rated exports out of the calculation, which understates taxable turnover.
• Judging VAT registration against corporate-tax rules, or the other way round — the two systems use separate tests.
• Waiting for the 12-month figure to confirm the position when confirmed orders already meet the 30-day test on their own.
• Registering voluntarily without budgeting for the return-filing and record-keeping work that comes with it.

Conclusion

VAT registration is determined by a company’s taxable activity, not simply by the date on its trade licence. Monitor the rolling 12-month total and confirmed activity expected over the next 30 days, then prepare the application as soon as the mandatory test is met. This guide explains how the rules work; confirm your specific position with the FTA or a qualified tax adviser.

If you are still planning the wider company-formation process, you can explore myHQ’s UAE business-setup support.

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