VAT refund in the UAE: A complete guide to tax-free shopping in the UAE for tourists

Looking for a travel experience that's truly one-of-a-kind? The United Arab Emirates (UAE) is a destination that should be at the top of your bucket list! Its juxtaposition of modern metropolises with countless towering skyscrapers in Dubai and hundreds of ancient archaeological sites in Khor Fakkan, the UAE offers a unique blend of tradition and modernity that guarantees you an unforgettable escape from the UK.

The UAE is also a must-visit shopping destination, especially if you travel to Dubai. Dubai is one of the seven emirates of the UAE, and the city is particularly renowned for its world-class shopping experience. You will be surprised by the massive shopping centres, flooded with the most trendy high-end fashion brands, gigantic fine dining, and charming little local shops.

It is worth noting, though, that you will be charged VAT when shopping. Compared to the UK, the UAE imposes a relatively lower VAT on tourists. And, you can also get a VAT refund in the UAE just before you leave. This article will answer every single question you might have about how you can claim your VAT refund in the UAE so that you can have more money for the next trip!

If you are looking for one more way to save even more, read this article and find out more about Wise!

How much is VAT in the UAE?

The UAE applies the same VAT rate across its cities, including Dubai. The VAT system in UAE is relatively simple, with two rates. The standard rate is 5%, which you will most likely encounter when shopping. Even if you enjoy a luxury shopping experience in Dubai, you only need to pay 5% VAT!

You should also note that there is a zero-rated VAT, which is applied for certain goods and services. You can refer to the table below for a quick check¹:

There are additional restrictions to consider. Due to their nature, some specific items are not reimbursable. You cannot claim a VAT refund for such as:

• Goods and services wholly or partly consumed or used in the UAE or any Emirate;
• Motor vehicles, boats, and aircraft; and
• Goods that you bought online;

How much VAT is refunded in the UAE?

If you are qualified for the VAT refund scheme in the UAE, you will receive 85% of the total VAT amount paid, after deducting a fee of AED 4.80 per tax-free tag.

Who is eligible for tax free shopping in the UAE?

You are qualified for a VAT refund in the UAE if you meet these requirements²:

• You must be at least 18 years old;
• You are a resident of a nation out of the UAE. This means that GCC Nationals are also eligible for this scheme;
• Your purchase must cost at least AED 250;
• You can physically present the tax invoice, ‘tax-free’ tags and relevant goods right at the airport before departing; and
• You will take the products with you in the personal luggage within 90 days upon your purchasing date.

How to get VAT refund in the UAE?

The Federal Tax Authority authorises Planet to be the exclusive operator of the tax refund system for tourists in the UAE². Therefore, when you want to use the VAT refund service in the UAE, you will encounter Planet's name several times.

Now that you have the general information, let's move on to the most exciting part: a complete guide to tax-free shopping in the UAE.

Receive a digital tax-free form and ‘tax-free’ tag

The very first step of how to claim VAT refund in the UAE for a tourist is to ensure that you are shopping from a retailer participating in the 'Tax Refund for Tourists’ scheme. Most popular stores are likely to be registered under this scheme anyway. Inform the store that you would like to participate in the VAT refund scheme, and they will issue you a digital tax-free form. The sales assistant may ask to see your identification documents, such as your passport, to verify your eligibility and ensure that you are not shopping on behalf of someone else. Remember, though, you can only claim a VAT refund if you are buying goods and services for yourself!

The store assistant will help you to input your information with the Planet system. Make sure to check if the shop assistant has already placed a ‘tax-free’ tag on the back of the sales receipt before you leave the store.

Have the purchase validated

There are two ways you can get VAT refund in the UAE with Planet:

When you arrive at the airport, make sure to validate your VAT refund service through the ‘Tax Free' validation point before checking in your flights and going through security. And if you are departing from Dubai Airport, you can use this VAT refund service across three terminals. The staff there will help you to validate your documents and goods.

Another way to get your VAT refund in the UAE is using the Planet self-service kiosk that can be found in the Dubai International Airport across all three terminals. You need to submit these documents:

• Your tax invoice ‘tax-free’ tag;
• A copy of your passport; and
• A copy of your credit card.

Obtain a VAT refund

After inspection and validation, you can also choose a refund method. Your VAT in the UAE will be refunded in cash, through your credit card, or to your digital wallet. You must leave the UAE within 6 hours of completing the validation process, or your VAT refund in the UAE will be cancelled immediately. After leaving the UAE, you will typically receive the refund within nine days if your chosen method is a credit card or digital wallet⁴.

If you opt for a cash refund, you stand to benefit from a maximum refund amount of 10,000 AED per day, and a maximum of 35,000 AED³ in cash per trip. And, if your refund amount exceeds this threshold, the additional VAT refund amount can be conveniently paid to a credit/debit card, ensuring you get the most out of your shopping experience.

If you are interested in knowing roughly how much you should expect when converting dirhams to pounds, use our exchange rate currency converter.

So now you already have in your hand this simple step-by-step guide on how to claim your VAT refund in the UAE! Pull up this article the next time you plan to visit Dubai for a shopping spree; you can save for your next escape from the UK. Moreover, on top of that, there is one more good news: you can save even more than this with Wise!

As mentioned above, tourists can receive a VAT refund in the UAE with the credit or debit card! However, if the denominated currency of the card (e.g., GBP) is different from the local currency (e.g., AED), it may be converted automatically. Usually, your card provider chooses the conversion rate, typically with a hidden mark-up. To minimise costs on currency conversion, consider receiving your refund with a Wise debit card, which only charges a small fee and converts at mid-market rates without markups and allows you to hold 40+ currencies, including AED. Order your Wise card for a one-time fee of 7 GBP today!

Get your card now

Please be aware that tax regulations and procedures may change over time. Always verify the information with official sources for the most accurate and up-to-date guidance.

Please see Terms of Use for your region or visit Wise Fees & Pricing for the most up to date pricing and fee information.

Sources used for this article:

Sources last checked on 26-Jun-2024.