Since being introduced to the UAE on January 1 this year, VAT has arguably been THE most talked about topic in the region; it’s clogged your newsfeeds, filled your inbox, and most likely been the topic of conversation on numerous coffee breaks in the office. But whilst we all get our heads around the new changes, there is one question that keeps coming up…is VAT applicable to rent? Experts in the region, Crompton Partners Estate Agents, tell us more…
“In short, VAT is not applicable to the rent that you pay on your home”
Ben Crompton explains, “whilst you will not pay VAT on rental property, VAT will be applicable on the goods and services surrounding your tenancy. For example, any fees that you pay to the manager, your ADDC bill, your chilled water bill, or any service charges that you pay in addition to your rent, will all now be subject to VAT at 5%”.
“The only exception to this might be if you are staying in a hotel serviced apartment. At the moment, it is not yet clear whether you will have to pay VAT if you are already renting the apartment as part of an annual lease, but certainly, if you’re renting a hotel or serviced apartment on a monthly basis or less, its likely that VAT will be applicable.”
