What taxes apply to Dubai property?
The UAE is one of the few global jurisdictions where residential property is essentially tax-free at the local level. There is no annual property tax, no capital gains tax on resale, no inheritance tax, and no personal income tax, meaning rental yield reaches you at the gross figure. The only direct property tax is a one-time 4% transfer fee paid to the Dubai Land Department at purchase, and a 5% VAT applies to commercial real estate (residential is VAT-exempt).
Local taxes: the full picture
- DLD transfer fee: 4% of purchase price, one-time, paid at title registration
- Trustee fee (DLD): AED 4,000 fixed, one-time
- Title-deed issuance: AED 250–4,000, one-time
- VAT on residential: 0% (exempt under UAE VAT Decree-Law No. 8 of 2017)
- VAT on commercial: 5% (chargeable to purchaser, recoverable if VAT-registered)
- Annual property tax: none
- Capital gains tax: none on resale
- Personal income tax on rental yield: none
- Inheritance tax: none in the UAE (home-country rules may still apply)
Annual carrying costs (not taxes, but recurring)
While there are no annual taxes, you do pay service charges (typical 12–25 AED per sq ft per year, covering common-area maintenance and amenities), DEWA utilities (electricity + water), and chiller/cooling charges in some buildings. For a 1,200 sq ft apartment, expect approximately AED 18,000–35,000 per year in total carrying costs, none of which are tax.
Bottom line
On the Dubai side, residential property is one of the most tax-efficient assets in any major global market, 4% one-time transfer fee, then nothing. The decision is rarely about local tax (it's near-zero); the calculation is about your home-country exposure on Dubai-derived income. Most buyers find that their home tax bill on Dubai property is meaningfully lower than on equivalent domestic property due to the absence of double taxation.