As of the latest regulations in 2024, residential rent in Dubai is exempt from Value Added Tax (VAT). This means that tenants renting residential properties do not have to pay VAT on their rent. This exemption is part of the UAE's broader tax policy, which aims to keep housing affordable for residents.

Key Points to Consider:

1. Residential Property VAT Exemption:
   
   

   • Residential properties are fully exempt from VAT, which includes both leasing and buying. This exemption applies to long-term residential leases (over 6 months) and is applicable whether the property is furnished or unfurnished.
     
     

   • The VAT exemption helps maintain the affordability of housing in Dubai, ensuring that tenants are not burdened with additional costs.
     
     

2. Commercial Properties:

   • In contrast to residential properties, commercial properties in Dubai are subject to a 5% VAT. This applies to both the sale and lease of commercial real estate, including offices, retail spaces, and industrial properties.
     
     

3. Mixed-Use Properties:

   • For mixed-use properties (those used for both residential and commercial purposes), VAT is only applied to the commercial portion of the property. The residential part remains exempt.
     
     

4. Developer and Landlord Obligations:

   • While residential rents are exempt from VAT, developers and landlords must still register for VAT if their taxable supplies and imports exceed AED 375,000 per year. However, this registration typically concerns commercial activities and not residential leasing.
     
     

Data Supporting VAT Exemption:

• According to the UAE Federal Tax Authority (FTA) and recent market reports, there has been no change in the VAT exemption status for residential rents as of 2024.
  
  

• The introduction of VAT in the UAE in 2018 included specific provisions to exempt residential rents, which have been maintained to support the real estate sector and housing affordability.
  
  

Conclusion:

Residential tenants in Dubai can rest assured that they will not be required to pay VAT on their rental payments. This exemption makes residential leasing more attractive and affordable, contributing to Dubai's appeal as a desirable place to live and work.