VAT on gold jewellery in the UAE: retail sales, investment gold and the trade

The Ministry of Finance lists certain investment-grade precious metals, such as gold and silver of 99% purity, among zero-rated supplies. A bar or coin meeting the conditions for investment precious metals is sold at 0%, and the seller keeps the right to recover input tax.

The conditions matter. Purity alone is not the whole test; the metal must be in a form traded in global bullion markets. A 24-carat pendant is still jewellery, not an investment bar, whatever its purity.

Jewellery sold to consumers is standard-rated. The 5% applies to the full price: gold value, making charges and stones. A jeweller in Deira selling a necklace for AED 8,400 including VAT has AED 400 of output tax, and the price on display must include VAT.

Tourists may be able to reclaim VAT through the tax refund scheme for tourists, and retailers participating in it report refunds in Box 2 of the VAT 201. Participation and the conditions are set by the FTA.

To reduce fraud risk in high-value metals, a Cabinet Decision introduced a domestic reverse charge on supplies of gold and diamonds, including products where gold or diamond is the main component, between VAT-registered businesses for resale or manufacture. The supplier does not charge VAT; the registered buyer accounts for it on its own return and recovers it, subject to the usual rules.

Buyers usually confirm in writing that they are registered and are buying for resale or manufacture. The FTA has used the same mechanism elsewhere: in October 2026 it published a public clarification on the reverse charge for metal scrap trading between registrants.

A registered gold wholesaler in Dubai sells AED 600,000 of 22-carat jewellery to a registered retailer in Sharjah for resale. Under the reverse charge, the wholesaler's invoice shows no VAT and states that the recipient must account for it. The retailer records AED 30,000 as output tax and AED 30,000 as input tax on the same return.

The retailer then sells the pieces to walk-in customers for AED 735,000 including VAT, collecting AED 35,000 of output tax that it pays to the FTA through the return. If the wholesaler had charged 5% instead, and the retailer had recovered it, the totals might look similar, but both returns would be wrong and the wholesaler would have collected VAT it should not have.

Gold traders are a natural focus for compliance checks, so records need to be tight.

• Weight, purity and form of each item on invoices, so the zero-rating or reverse charge can be supported.
• The buyer’s TRN and declaration for every reverse charge sale.
• Separate sales accounts for investment gold, retail jewellery and trade sales.
• Stock records by weight and value, reconciled regularly.
• Bank transfers rather than cash for large purchases, given the 2026 rules restricting input tax on high-value cash purchases once the Minister sets the threshold.

HelloBooks lets you set the VAT treatment per item and per customer type: zero-rated for qualifying bullion, standard-rated for retail jewellery, reverse charge for registered trade buyers. The AI checks each invoice against the customer record and warns if a reverse charge sale has no TRN on file. Lot and batch tracking on the Business plan helps trace stock. Jewellery businesses with specific reporting by weight or karat can ask us to configure it through /book-a-demo.