VAT at the rate of 5% is applicable to the sale and renting of commercial properties in the UAE starting from January 1, 2018. The buyer of a commercial property is liable to pay VAT by registering on the FTA portal. In case of a rental commercial property, the owner is liable to pay VAT. In this article, we discuss the procedure of making VAT payment to the FTA on the purchase of a commercial property.
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Procedure to Pay VAT on Commercial Properties
If you have recently purchased a new property in the UAE for commercial use or renting purpose, you should pay VAT on the property value directly to the FTA. Follow the step by step procedure to make the VAT payment now.
Step 1: e-Service Account
If you are not already registered for VAT UAE, you first need to create an e-Service account on the portal (https://eservices.tax.gov.ae/en-us/user/dashboard).
- Visit the website and create a new account by clicking the ‘Register’ button.
- Verify your email address to be able to log in to your account.
- Login to your e-Services accounts by using the Email address and password provided at the time of registration.
Step 2: Payment Details
Click on ‘My Payments’ tab from the top menu.
Select ‘Commercial property sale’ from the drop-down menu as the ‘Payment for’ option under ‘Miscellaneous Payment’ head.
Following that, enter the details as mentioned below.
- VAT amount – the applicable VAT amount on the sale of the property. (mentioned in the tax invoice provided by the seller.)
- Seller’s TRN – The Tax Registration Number of the seller, mentioned in the tax invoice.
- Property number – The official property number as provided by the seller or the land registration department.
- Date of sale – the purchase date as mentioned on the tax invoice.
- Land department – Choose the land department from the list.
Once the above details are complete, cross-check the details and proceed to ‘Make Payment’.
Step 3: VAT Payment
Click on ‘Make Payment’ button to proceed. The next page shows you Payment Information. Click on ‘Pay Now’ button to proceed.
The next page will take you to the e-Dirham payment gateway for making the VAT payment. You can select your preferred payment option and click on confirm to proceed.
Once the payment is made successfully, you will get the payment transaction number on the screen. Save this number.
The payment transaction number is required in order to complete the ownership transfer process of the said commercial property. Make sure to carry the number while visiting the Land Department office.