Key takeaways
- No annual property tax, no rental income tax and no capital gains tax in the UAE.
- The 4% Dubai Land Department transfer fee is the single largest government charge, paid once at purchase.
- Residential sales and long-term leases are VAT-exempt; commercial property carries 5% VAT.
- A 5% municipality housing fee applies to tenants via DEWA, not to owners of an occupied home.
- Your country of tax residence may still tax the income and the gain — the UAE's treaty network often mitigates it.
What you do not pay
There is no annual property tax or council-tax equivalent for owners in Dubai. There is no tax on rental income. There is no capital gains tax when you sell, and no inheritance tax under UAE federal law — though succession for non-Muslim owners should be handled with a DIFC will or a registered Dubai Courts will rather than left to default rules.
That combination is why net yield in Dubai holds up against gross yield far better than in taxed markets. A 5.5% net Dubai yield is genuinely 5.5% in the UAE; a 5.5% gross London yield is closer to 2.5% after tax and costs.
What you do pay, once
The Dubai Land Department transfer fee is 4% of the purchase price, plus a small admin charge (AED 580 for apartments and villas, AED 430 for off-plan). Trustee office fees are AED 4,000–4,200 plus VAT. Title deed issuance is AED 250. Agency commission is 2% plus 5% VAT on the secondary market.
With mortgage registration (0.25% of the loan plus AED 290) and valuation, total acquisition costs land at 6–8% of price. The hidden costs of buying property chapter breaks each line down.
VAT, corporate tax and service charges
Residential property is exempt from the UAE's 5% VAT on sale and on long-term lease. Commercial property sales and leases carry 5% VAT, recoverable if you are VAT-registered. Short-term holiday-home income falls into the taxable bracket once you exceed the mandatory registration threshold of AED 375,000 in taxable turnover.
The UAE's 9% federal corporate tax applies to business profits above AED 375,000, and specifically excludes income earned by individuals from personal real estate investment. If you hold through a company, take structuring advice before you sign.
Service charges are not a tax but they behave like one: AED 10–30 per square foot per year, set annually and approved by RERA through the Mollak system. They are the recurring cost that actually moves your net yield.
Your home country still matters
UAE-source rental income and gains are generally reportable in your country of tax residence. UK residents pay income tax on the rent and CGT on the gain; US citizens report worldwide income; most EU residents declare the rent with credit for foreign tax paid, which in the UAE is nil.
The UAE has more than 140 double-tax treaties, and UAE tax residency (183 days, or 90 days with qualifying ties) changes the picture entirely — which is one reason investors pair a purchase with the Golden Visa route.
Frequently asked questions
Is there property tax in Dubai?
No. Dubai has no annual property tax. The main government charge is the one-off 4% Dubai Land Department transfer fee paid at purchase, plus small admin and trustee fees.
Do you pay capital gains tax when selling Dubai property?
No capital gains tax is levied in the UAE. Your country of tax residence may still tax the gain, so take local advice before you sell.
Is rental income taxed in Dubai?
There is no UAE income tax on rental income for individual investors. Short-term holiday-home operations can fall within VAT if taxable turnover exceeds AED 375,000.
Does VAT apply to buying a Dubai apartment?
No — residential sales and long-term residential leases are VAT-exempt. Commercial property carries 5% VAT, and agency commission is subject to 5% VAT.