Accounting software for UAE trading & import/export businesses
Reverse charge on imports, zero-rated exports outside the GCC, Designated-Zone treatment for free-zone goods, multi-currency purchasing, and the FTA VAT 201 return — built for Dubai and UAE traders.
Trading is the backbone of the UAE economy, and it is also where VAT gets complicated fastest. A general-trading company in a Dubai free zone can be buying from China, storing in a Designated Zone, selling to a mainland customer and re-exporting to Africa — and each of those legs has a different VAT treatment. Imports are subject to the reverse charge; exports outside the GCC implementing states are zero-rated; supplies of goods inside a Designated Zone can be outside the scope entirely; and the moment goods enter the mainland, standard 5% VAT applies. This page covers how HelloBooks keeps each leg on the right side of the FTA rules.
UAE trading & import/export at a glance
| Field | Value |
|---|---|
| Authority | Federal Tax Authority (FTA) VAT administered federally; customs handled by the emirate customs authority. |
| Standard VAT rate | 5% Applies to mainland supplies and any goods leaving a Designated Zone into the UAE. |
| Imports | Reverse charge Import VAT self-accounted on the VAT 201; recoverable as input VAT if entitled. |
| Exports outside the GCC | Zero-rated (0%) Requires official and commercial evidence of export within 90 days. |
| Designated Zones | Out of scope for goods Only Cabinet-listed zones; services still follow mainland rules. |
| Registration threshold | AED 375,000 mandatory Voluntary from AED 187,500. |
Rates and thresholds verified against the UAE Federal Tax Authority (FTA) as at 2026-07-10. Re-verify after any Cabinet Decision that amends the VAT executive regulations.
The reverse charge on imports
When a UAE trader imports goods, VAT is not paid at the same point as a mainland purchase — it is self-accounted under the reverse-charge mechanism on the VAT 201. You declare the import VAT as output tax and, if the goods are for taxable business use, recover the same amount as input VAT in the same return. For most traders the net cash effect is nil, but the entries must appear or the return is wrong.
HelloBooks posts both sides of the reverse charge automatically when a bill is flagged as an import, and links the customs import declaration reference so the VAT 201 box 6 (goods imported) reconciles to your customs records. That reconciliation is exactly what the FTA looks at first in a trading-company audit.
Designated Zones — where free zone does not mean no VAT
A common and expensive mistake: assuming a free-zone company charges no VAT. Only the free zones the Cabinet lists as Designated Zones get special treatment, and only for goods. A supply of goods within, or between, two Designated Zones can be outside the scope of UAE VAT — but a supply of services, or any goods that cross into the mainland, is standard-rated at 5%.
HelloBooks lets you tag each customer and supplier with its zone status, so a goods sale to a Designated-Zone customer follows the FTA position instead of defaulting to 5%, while services to the same customer are correctly taxed. Every such line is flagged on the invoice for your auditor.
Zero-rated exports and the evidence rule
Exporting goods to a destination outside the GCC implementing states is zero-rated, but the zero rate is conditional: you must hold official evidence (the customs export declaration) and commercial evidence (airway bill, bill of lading, or similar), and the goods must physically leave within 90 days of the supply. If the evidence is missing, the FTA can reclassify the supply as standard-rated and assess 5% plus penalties.
HelloBooks tracks the export-evidence status on each zero-rated sale and flags any export line still missing its documentation as the 90-day window approaches, so a zero-rated export never quietly becomes an unfunded 5% liability.
Questions UAE trading & import/export ask
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