Do online sellers based outside the UAE charge UAE VAT?
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No – a seller based outside the UAE doesn't charge UAE VAT on goods shipped directly from abroad to you. But when the goods arrive in the UAE, import VAT of 5% is usually due (paid by whoever is named as the importer), unless the goods would be zero-rated or exempt.
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The detail
Where a non-resident online seller delivers goods to the customer from outside the UAE, the place of supply is outside the UAE, so UAE VAT is not charged on the supply itself, even if the goods are later imported. However, importation of the goods into the UAE separately triggers import VAT at 5% on the customs value, unless the goods would be zero-rated or exempt if supplied domestically. If instead the seller first imports the goods into the UAE and then supplies them to the customer, that supply is treated as a local UAE supply and is subject to UAE VAT in the normal way.12
What the law says
- The import value for VAT purposes is the customs value (including insurance, freight, customs fees and excise tax), per Article 35 of the Decree-Law.1
- FTA guidance states that goods supplied and delivered from outside the UAE have a place of supply outside the UAE, so no UAE VAT applies on the sale, though importation triggers import VAT at 5% unless zero-rated or exempt.2 Based on FTA guidance
- FTA guidance confirms that if goods are first imported into the UAE and then supplied to the recipient, that supply is treated as a local UAE supply subject to UAE VAT.2 Based on FTA guidance
What it depends on
- The outcome depends on whether the goods are shipped directly to the customer from abroad (no UAE VAT on the sale) or imported by the seller first and then sold locally (UAE VAT applies).2 Based on FTA guidance
- Import VAT is accounted for by whoever is named as the importer on the customs declaration, and the accounting mechanism depends on that importer's VAT registration status.2 Based on FTA guidance
Check before you rely on it
- Check whether the goods were shipped directly from abroad or already imported before sale to you.
- Check who is listed as the importer on the customs paperwork.
- Check if the goods fall under a zero-rated or exempt category that would remove the import VAT charge.
Sources (2) — read the official text
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Article 35 - Value of Import
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Article 35 - Value of Import The Import value of Goods consists of: 1. The customs value pursuant to Customs Legislation, including the value of insurance, freight and any customs fees and Excise Tax paid on the Import of the Goods. Tax shall not be included in the value of the supply. 2. If it is not possible to determine the value pursuant to Clause 1 of this Article, the value shall be determined based on alternate valuation rules stated in the applicable Customs Legislation.
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Read the article
recipient’s UAE residency and registration status. The supplier should also retain this information for its records and in order to be able to substantiate the application of the reverse charge mechanism in case of a tax audit. If the non-resident supplier cannot ascertain all of the details necessary for the application of the reverse charge mechanism to a supply, such as that the recipient is registered for VAT, then the supplier should register for VAT in the UAE and account for VAT to the FTA itself. 3.4. Sales of goods from outside the UAE Where goods are supplied by the supplier outside of the UAE, the place of supply of the goods is also outside the UAE. Thus, if a supply of goods involves the goods being transferred to the recipient outside of the UAE, the place of supply of the goods is outside the UAE, even if the goods are subsequently imported into the UAE. This means that UAE VAT does not apply to the supply of these goods. This should be contrasted with situations where the goods are first imported into the UAE and then supplied to the recipient – in such situations, the supply of the goods to the recipient is treated as a local supply in the UAE with the place of supply in the UAE. It should be noted that the physical importation of goods into the UAE would typically also trigger the obligation on the importer (either the supplier or the recipient) to account for import VAT. This is discussed in more detail in the next part of this Guide. 3.5. VAT on import of goods into the UAE 3.5.1. Imposition and accounting for import VAT Where goods are imported into the UAE from overseas, the goods will be subject to import VAT at 5%, unless the goods would be either zero-rated or exempt if supplied in the UAE. Import VAT is imposed on the customs value as calculated pursuant to Customs legislation, including the value of insurance, freight and any customs fees and excise tax paid on the import of the goods. Where the determination of such customs value is not possible, then the value can be determined based on the alternate valuation rules stated in the applicable Customs legislation.19 The obligation to account for import VAT is on the “importer”, being the person whose name is listed as the importer of the relevant goods for customs clearance purposes. The mechanism for accounting for VAT on imported goods depends on the VAT registration status of the importer at the time of importation. 19 Article 35 of the Decree-Law. 14
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Written by AI from the FTA sources above and checked before display. Not tax advice or official FTA information - confirm with a tax adviser before you act. Full disclaimer
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