These are the tax changes coming up in the UAE in 2026

The UAE is focusing on tax reforms, and 2026 will bring more changes to the system.

The Emirates imposed value added tax (VAT) at a rate of 5 per cent in 2018 and corporate tax at 9 per cent in 2023 as part of its plans to diversify its economy. From January 2025, it also implemented domestic minimum top-up tax of 15 per cent on large multinational companies in line with OECD’s corporate tax guidelines. The UAE also levies excise tax as an indirect tax on goods deemed harmful to health such as tobacco and sugary drinks.

The country forecasts tax revenue for fiscal year 2025 at Dh12.6 billion ($3.44 billion), up more than 12 per cent annually. VAT is expected to contribute Dh11.3 billion, followed by excise tax revenue of Dh1.3 billion.

As its tax system matures, the UAE has been introducing more regulations and amendments to comply with international standards.

Here are some notable changes to look out for in 2026:

VAT amendments

New VAT rules that take effect on January 1 are created to simplify tax procedures for taxpayers while ensuring transparency and compliance with international standards, the Ministry of Finance said last month.

First, the amendments say taxpayers will no longer need to issue self-invoices when applying the reverse charge mechanism, but they will need to retain supporting documents related to supply transactions. Reverse charge is when the responsibility for accounting and paying the tax is shifted from the supplier to the buyer.

“This is a great simplification and one that had been of concern to many businesses,” said Justin Whitehouse, managing director with Alvarez & Marsal Tax in Dubai.

Mira Bagaeen, associate at law firm Reed Smith, agreed that the move eases the administrative duties for companies.

Another key change is that there is now a five-year time limit for submitting requests to reclaim any excess refundable tax. This period begins at the end of the tax period when the credit first arose.

The change will prevent VAT refund balances from remaining indefinite, said Th