# UAE VAT registration for online stores and apps: thresholds, EmaraTax steps, invoices and penalties

> A UAE-resident business, including an online store or app, must register for VAT with the Federal Tax Authority (FTA) when its taxable supplies and imports exceeded AED 375,000 over the previous 12 months, or are expected to exceed it in the next 30 days, and must apply within 30 days of becoming liable. It may register voluntarily above AED 187,500 of taxable supplies, imports or taxable expenses. A foreign seller with no place of residence in the UAE has no threshold: it must register from its first taxable sale in the UAE where no one else, such as a VAT-registered business buyer under the reverse charge, is liable for the tax. That catches foreign stores and apps selling to UAE consumers. Registration is online through EmaraTax. Once registered, published prices must include VAT, tax invoices must follow the Executive Regulation, and returns are normally quarterly, due by the 28th day after the period ends. Registering late costs AED 10,000, and the FTA backdates the registration, so you owe VAT on past sales you did not charge it on. This guide covers the tests, the EmaraTax steps and what to change in your store.

- Canonical: https://www.ogblabs.com/guides/uae-vat-registration-online-sellers
- Arabic version: https://www.ogblabs.com/ar/guides/uae-vat-registration-online-sellers
- Author: OGB Labs (https://www.ogblabs.com)
- Published: 2026-10-16
- Updated: 2026-10-16

## The rules, and where to read them

UAE VAT is set by Federal Decree-Law 8 of 2017 and its Executive Regulation, Cabinet Decision 52 of 2017. The FTA administers it. Everything in this guide comes from documents on the FTA's website, which we read in October 2026:

- The FTA's [Registration for VAT page](https://tax.gov.ae/en/taxes/Vat/vat.topics/registration.for.vat.aspx), last updated 6 April 2026, with the two thresholds.
- [Federal Decree-Law 8 of 2017](https://tax.gov.ae/DataFolder/Files/Pdf/VAT-Decree-Law-No-8-of-2017.pdf): articles 13 to 19 on mandatory, voluntary and non-resident registration, and article 31 on electronic services.
- The [Executive Regulation with its amendments](https://tax.gov.ae/Datafolder/Files/Legislation/2026/Law-No-8-of-2017-and-its-amendments--09-2026.pdf), consolidated by the Ministry of Finance up to Cabinet Decision 149 of 2026, in force from 1 October 2026: thresholds, deadlines, price display and tax invoices.
- [Cabinet Decision 40 of 2017 with its amendments](https://tax.gov.ae/Datafolder/Files/Legislation/2025/Cabinet%20Decision%20No.%2040%20of%202017%20and%20its%20amendments%20-%20publishing%2011%202025.pdf), including Cabinet Decision 129 of 2025, in force from 14 April 2026: the administrative penalties.
- The FTA's [EmaraTax VAT registration manual](https://tax.gov.ae/Datafolder/Files/Guides/VAT/VAT%20User%20Guide.pdf): the application, section by section.

## When a UAE business must register

Article 7 of the Executive Regulation sets the mandatory registration threshold at AED 375,000, and article 13 of the Decree-Law applies it to anyone with a place of residence in the UAE. You must register in either of two situations:

- Looking back: your taxable supplies and imports exceeded AED 375,000 over the previous 12 months.
- Looking forward: you expect them to exceed AED 375,000 in the next 30 days. A big wholesale contract, a marketplace launch or a seasonal campaign can trigger this before the history does.

## What counts towards the threshold

Article 19 of the Decree-Law counts the value of your taxable supplies, both standard-rated and zero-rated, plus imports of goods and services on which you must account for VAT yourself under the reverse charge. Exempt supplies, such as bare land or residential rent, do not count, and article 20 leaves out sales of your own capital assets.

For an online store, that usually means product sales including delivery charges you bill, exports, which are zero-rated but still count, and subscriptions or digital products. For an app or SaaS business, it means subscription and in-app revenue from UAE customers, plus services you buy from abroad, such as cloud hosting, advertising and software, which you account for under the reverse charge.

Splitting one business across several companies does not reset the count. Article 13 of the Executive Regulation lets the FTA add together the supplies of related parties that have segregated their business artificially, or where it sees a loss of tax revenue from the split.

## Voluntary registration from AED 187,500

Article 8 of the Executive Regulation lets you register voluntarily if your taxable supplies and imports, or your taxable expenses, exceeded AED 187,500 in the previous 12 months or will in the next 30 days. Taxable expenses here means standard-rated costs incurred in the UAE by a UAE resident. You must show that you carry on business in the UAE, and if you register on a forecast, the FTA can ask for evidence.

Startups often register early because it lets them recover the VAT on their build costs, such as the website or app, equipment and fit-out. The trade-off is quarterly returns and the obligations below from day one. If most of your customers are consumers who cannot recover VAT, registering early also means either raising prices by 5% or absorbing the tax, so run both numbers with your accountant.

## Foreign online stores and apps: no threshold

The FTA's page says the AED 375,000 threshold "is not applicable to foreign businesses." Article 13(2) of the Decree-Law requires a person with no place of residence in the UAE to register if it makes supplies of goods or services in the UAE "where no other Person is obligated to pay the Due Tax." Article 7(6) of the Executive Regulation backdates that registration to the date the business started making supplies in the UAE.

In practice, the line falls between business and consumer customers. When a UAE VAT-registered business buys services from a foreign supplier, the buyer usually accounts for the VAT under the reverse charge in article 48, so the supplier need not register for those sales. When the customer is a consumer, nobody else is liable, so the foreign supplier must register from the first sale.

That matters for apps and digital products. Article 31 of the Decree-Law places electronic services in the UAE to the extent they are used and enjoyed there, "regardless of the place of contract or payment." Article 23 of the Executive Regulation defines electronic services widely: software and updates, web hosting and domain names, e-books and digital files, streaming, games on demand, online advertising space and distance learning. A foreign app or course platform with UAE consumers is in scope.

Foreign businesses register through the same EmaraTax application. The FTA's manual says a foreign business may choose to appoint a tax agent in the UAE. Imports a foreign business brings into the UAE, where the importer accounts for the VAT, do not count towards its own registration under article 18.

## The deadline, and what happens if you are late

Article 7(2) of the Executive Regulation gives you 30 days from the day you become required to register to file the application. If you miss it, the FTA registers you anyway. On the look-back test, registration takes effect from the first day of the month after the month you became liable; on the forward test, from the date there were reasonable grounds to expect you would cross the threshold.

The costly part is article 7(7): a late registrant must pay the VAT due on all taxable supplies and imports made before registering. Those orders are already paid at VAT-free prices, so for a consumer store the 5% usually comes out of margin. On top of that, Cabinet Decision 40 of 2017, as amended, sets a fixed penalty of AED 10,000 for not applying on time.

## How to register on EmaraTax

Registration is free and done online. These are the sections of the application in the FTA's EmaraTax manual:

1. Sign in to EmaraTax with an email and password or with UAE Pass, or sign up for an account, then create or select the taxable person.
2. Entity details: the entity type, such as an incorporated company or a sole establishment, and its identification details.
3. Main licence details, business activities, owners and any branches. Trade licence details are required for most entity types, so have the licence and its activity list to hand.
4. Eligibility details: your taxable supplies and taxable expenses in AED, entered on screen or through the FTA's Excel template. The system then shows whether your registration is mandatory or voluntary, and the effective date, which you can change by giving a reason.
5. Contact details: the registered address where most day-to-day business happens. The manual says not to use another company's address, such as your accountant's.
6. Business relationships: the manager or CEO, and any partners or directors.
7. Bank details, which are optional at this stage but avoid a later amendment, and additional details such as GCC business activities and customs registration numbers if you import.
8. Authorised signatory, then review and declaration. You get a reference number, and the FTA approves the application, rejects it or sends it back for more information by email.

## Your obligations once registered

- Charge 5% VAT on standard-rated sales, and show your Tax Registration Number (TRN) on tax invoices.
- Publish VAT-inclusive prices. Article 27 of the Executive Regulation says published prices for taxable supplies must include tax. You may show prices excluding VAT only for exports or for customers who are VAT-registered, and then they must be clearly marked as excluding tax.
- Issue tax invoices with the contents in article 59. A simplified tax invoice is allowed when the customer is not VAT-registered, or is registered and the sale is no more than AED 10,000, and is issued on the date of supply. A full tax invoice is due within 14 days of the date of supply.
- Issue tax credit notes for refunds, cancellations and price reductions.
- File returns. The standard tax period is three calendar months, and article 64 requires the return and payment to reach the FTA by the 28th day after the period ends.
- Keep records of every supply, including the emirate of the fixed establishment the supply relates to, for the periods in the Tax Procedures Law.

## Penalties that online sellers meet most

These amounts are from Cabinet Decision 40 of 2017 as amended by Cabinet Decision 129 of 2025, which applies from 14 April 2026. The consolidated text on the FTA's site is labelled as not an official translation.

**Selected UAE VAT penalties from 14 April 2026**

| Violation | Penalty |
| --- | --- |
| Not applying for registration on time | AED 10,000 |
| Not displaying prices inclusive of VAT | AED 5,000 |
| Not issuing a tax invoice on time | AED 2,500 for each detected case |
| Not issuing a tax credit note on time | AED 2,500 for each detected case |
| Not meeting the rules for issuing tax invoices and credit notes electronically | AED 2,500 for each detected case |
| Filing a return late | AED 1,000, or AED 2,000 if repeated within 24 months |
| Paying VAT late | 14% a year, charged monthly on the unpaid tax |
| Filing an incorrect return | AED 500, unless corrected in time or by a voluntary disclosure with no difference in tax due |
| Not keeping the required records | AED 10,000, or AED 20,000 if repeated within 24 months |

## What to change in your store or app

Most of the work after registration is in the store, not the tax portal. These are the changes we make on UAE ecommerce and app projects:

1. Track the threshold before you need it: a monthly report of taxable sales over the last 12 months, and a forecast for the next 30 days, so you register on time rather than after an audit.
2. Switch the storefront to VAT-inclusive prices, and check every place a price appears: product pages, listings, the cart, ads, marketplace feeds and WhatsApp catalogues.
3. Make the order confirmation a compliant tax invoice: the words "Tax Invoice", your name, address and TRN, a sequential number, the date, item descriptions and the VAT in AED. If you sell in other currencies, show the AED amounts and the exchange rate used.
4. Add an optional company name and TRN field at checkout, so business customers get a full tax invoice and you can show them prices excluding VAT where that is allowed.
5. Generate tax credit notes automatically for refunds, returns and partial cancellations, linked to the original invoice.
6. Set tax rules for delivery fees, gift wrapping, zero-rated exports and any exempt items, and test them in the platform's tax settings.
7. Export a report that matches the VAT return, with sales by emirate, exports and reverse-charge purchases such as foreign advertising and SaaS.

## VAT and UAE e-invoicing

From 2027, sales to businesses move to Peppol e-invoicing through accredited service providers, and that applies whether or not you are VAT-registered. Sales to consumers stay outside e-invoicing until the Minister of Finance decides otherwise. If your store has trade customers, the TRN field above is also the switch that routes those orders to e-invoicing. See our guide to [UAE e-invoicing](https://www.ogblabs.com/guides/uae-e-invoicing) for the dates and the ASP model.

If you are still choosing a platform, our guides to [Shopify vs custom ecommerce in the Gulf](https://www.ogblabs.com/guides/shopify-vs-custom-ecommerce-gulf) and [what a custom ecommerce store costs](https://www.ogblabs.com/guides/custom-ecommerce-store-cost-2026) cover how much control each option gives you over tax and invoices. VAT is separate from corporate tax, which every UAE company must register for regardless of turnover; see [UAE corporate tax registration for small businesses](https://www.ogblabs.com/guides/uae-corporate-tax-registration-small-business). Selling in Oman or Saudi Arabia too? Read [Oman VAT registration for online sellers](https://www.ogblabs.com/guides/oman-vat-registration-online-sellers), [Saudi VAT registration for online sellers](https://www.ogblabs.com/guides/saudi-vat-registration-online-sellers), [building an online store in Oman](https://www.ogblabs.com/guides/online-store-oman) and [ZATCA e-invoicing Phase 2](https://www.ogblabs.com/guides/zatca-e-invoicing-phase-2-saudi).

## How OGB Labs helps

OGB Labs, with a team in Dubai, builds and fixes the ecommerce and app side of VAT compliance: VAT-inclusive pricing, compliant tax invoices and credit notes, a TRN field at checkout, threshold and VAT return reports, and the link to your accounting software. Your accountant or tax agent handles the registration and the returns; we make sure the data they need comes out of your store correctly. See [web and software development in the UAE](https://www.ogblabs.com/locations/uae) and our [ecommerce service](https://www.ogblabs.com/services/ecommerce), or message us on WhatsApp at +968 7111 0727.

## Frequently asked questions

### What is the VAT registration threshold in the UAE?

AED 375,000 of taxable supplies and imports over the previous 12 months, or expected in the next 30 days, for mandatory registration. Voluntary registration is possible above AED 187,500 of taxable supplies, imports or taxable expenses.

### Does an online store in the UAE need to register for VAT?

Yes, once its taxable sales and imports cross AED 375,000 in 12 months or are expected to in the next 30 days. Online sales are treated the same as shop sales. Delivery charges and zero-rated exports count towards the threshold.

### Do foreign online sellers have to register for UAE VAT?

Yes, when they sell to UAE customers and no one else is liable for the VAT. The threshold does not apply to foreign businesses, so a foreign store or app selling to UAE consumers must register from its first sale. Sales to VAT-registered UAE businesses are usually covered by the buyer's reverse charge.

### How long do I have to apply for UAE VAT registration?

30 days from the day you become required to register, under article 7 of the VAT Executive Regulation.

### What is the penalty for late VAT registration in the UAE?

AED 10,000 under Cabinet Decision 40 of 2017 as amended. The FTA also backdates your registration, and you must pay VAT on taxable sales made from the date you should have been registered.

### How much does UAE VAT registration cost?

The FTA does not charge for registering through EmaraTax. You pay only if you use an accountant or tax agent to prepare the application.

### Do prices on a UAE website have to include VAT?

Yes, for VAT-registered sellers. Article 27 of the Executive Regulation requires published prices to include VAT, except for exports and for VAT-registered customers, where prices must be clearly marked as excluding tax. The penalty for not displaying VAT-inclusive prices is AED 5,000.

### Can I issue a simplified tax invoice for online orders?

Yes, when the customer is not VAT-registered, or is registered and the order is no more than AED 10,000. It needs the words Tax Invoice, your name, address and TRN, the date, a description, and the total and VAT in AED.

### How often are UAE VAT returns filed?

Normally every three months. The return and the payment must reach the FTA by the 28th day after the end of the tax period. The FTA can assign a different period.

## Related

- [Ecommerce](https://www.ogblabs.com/services/ecommerce): Stores built to sell: storefronts that feel like your brand, a checkout people finish and inventory that stays in sync.
- [Custom Software](https://www.ogblabs.com/services/custom-software): Portals, dashboards and business systems shaped around the way your company really runs.
- [VAT registration in Saudi Arabia for online stores and apps: thresholds, foreign sellers, marketplaces and penalties](https://www.ogblabs.com/guides/saudi-vat-registration-online-sellers): When a Saudi or foreign online store, app or SaaS must register for VAT with ZATCA: SAR 375,000 and 187,500 thresholds, marketplace rules, deadlines and fines.
- [UAE PASS integration for websites and apps: login, onboarding steps and the rules you must follow](https://www.ogblabs.com/guides/uae-pass-integration-websites-apps): How to add Sign in with UAE PASS to a website or app: who can integrate, the onboarding phases, the OAuth 2.0 flow, account levels, linking rules and go-live checks.
- [Payment gateways in the UAE: cards, Jaywan, Apple Pay, Aani and BNPL for websites and apps](https://www.ogblabs.com/guides/payment-gateways-uae): How to accept online payments in the UAE: cards, the new Jaywan national card, Apple Pay, Google Pay, Aani, Tabby and Tamara, CBUAE licensing, fees and what to check before you integrate.

## Contact

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