The FTA has clarified that online purchases are not VAT exempt and 5% VAT rate is applicable on all purchases made through online shopping portals just like any other purchase made through traditional outlets if the products purchased online are received within the UAE.

FTA explained in an awareness flyer issued on Friday that according to Federal Decree-Law No. (8) of 2017 on Value Added Tax and its Executive Regulations, all online sales are subject to VAT where the value of a seller’s supplies is over the mandatory registration threshold of 375,000 Dirhams over the previous 12 months or the coming 30 days.

Need help implementing VAT in your online retail business? Contact our VAT experts today and we will make sure your business is VAT compliant and on the right track.