Authored by the expert who managed and guided the team behind the UAE Property Pack
Yes, the analysis of Dubai's property market is included in our pack
Dubai has no annual property tax, but charges specific government fees during property transactions, mortgage registration, and ownership periods.
Property buyers face a 4% DLD transfer fee, registration costs ranging from AED 2,100 to AED 4,200, and ongoing Dubai Municipality housing fees of 5% of annual rental value charged monthly through DEWA bills.
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Dubai imposes no recurring annual property tax on residential properties, making it attractive for foreign investors seeking tax-efficient real estate ownership.
Property transactions involve a 4% DLD transfer fee, registration fees of AED 2,100-4,200, and ongoing municipality housing fees of 5% of annual rental value for expatriates.
| Property Tax Type | Rate/Amount | Who Pays |
|---|---|---|
| Annual Property Tax | 0% (None) | No one |
| DLD Transfer Fee | 4% of purchase price | Buyer (typically) |
| Registration Fee | AED 2,100 (<500K) / AED 4,200 (>500K) | Buyer |
| Mortgage Registration | 0.25% of loan + AED 290 | Buyer |
| Municipality Housing Fee | 5% of annual rental value | Expatriate residents |
| VAT on Property Sales | 0% (residential) / 5% (commercial) | As applicable |
| Capital Gains Tax | 0% (None) | No one |
Fact-checked and reviewed by our local expert
Jean-Charles Salvin 🇫🇷
Co-Founder, Best Dubai Condos
Does Dubai charge annual property tax on homeowners in 2025?
Dubai does not impose any annual property tax on residential or commercial property owners in 2025.
This zero property tax policy applies to all property types including apartments, villas, townhouses, and land plots. Unlike many global cities that charge 1-3% annual property taxes, Dubai generates municipal revenue through transaction fees and service charges instead.
The absence of annual property tax makes Dubai attractive for long-term real estate investment, as owners only pay upfront transaction costs and ongoing service charges. Property owners do pay a Dubai Municipality housing fee of 5% of annual rental value, but this covers municipal services rather than being classified as a traditional property tax.
As of September 2025, the UAE Federal Tax Authority confirms no plans to introduce annual property taxes, maintaining Dubai's tax-advantaged status for real estate investors.
What government taxes and fees apply when buying completed secondary properties?
Buyers of completed secondary properties in Dubai pay several mandatory government fees totaling approximately 6-8% of the purchase price.
The primary government charge is the DLD transfer fee of 4% of the total purchase price. By convention, this fee is often split equally between buyer and seller (2% each), but market practice typically sees buyers paying the full 4%.
Additional mandatory fees include the DLD registration fee of AED 2,100 (including 5% VAT) for properties below AED 500,000, or AED 4,200 (including 5% VAT) for properties above AED 500,000. Buyers also pay AED 580 for title deed issuance.
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Real estate brokerage fees of 2% are privately negotiated costs paid to agents, not government fees.
Which government charges apply to off-plan property purchases?
Off-plan property buyers face the same 4% DLD registration fee plus specific off-plan documentation charges.
| Fee Type | Amount | Payment Timing |
|---|---|---|
| DLD Registration Fee | 4% of purchase price | At initial registration |
| Oqood Registration | AED 540 per unit | During off-plan registration |
| Title Deed Issuance | AED 580 | Upon project completion |
| Administration Fee | AED 40 | At registration |
| VAT (if applicable) | 5% on first supply | As per payment plan |
What government levies apply when using mortgage financing?
Mortgage financing triggers specific DLD registration fees based on the loan amount.
The primary mortgage registration fee is 0.25% of the total loan amount plus a fixed AED 290 administrative fee. For a AED 2 million mortgage, buyers pay AED 5,000 registration fee plus AED 290, totaling AED 5,290.
These fees are collected by DLD at the time of mortgage registration, which occurs after loan approval and before property transfer. Banks may also charge separate valuation fees (AED 2,500-3,500) and processing fees, but these are private charges rather than government levies.
Cash buyers avoid all mortgage-related government fees, paying only the standard transfer and registration charges.
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Are NOC and clearance fees required for property transfers?
No Objection Certificates (NOC) from developers or master communities are mandatory for most property transfers, with fees varying by project.
Developer NOC fees typically range from AED 500 to AED 5,000, depending on the specific project and developer policies. Premium developments and master communities like Emirates Hills, Dubai Hills Estate, or Jumeirah Village Circle often charge higher NOC fees.
These fees ensure all service charges and maintenance fees are current before property transfer. The seller typically pays NOC fees, though this can be negotiated between parties.
Master community fees are separate from developer NOCs and may add another AED 1,000-3,000 to the transfer process. Both certificates are required before DLD will process the title transfer.
What recurring charges apply to owner-occupiers?
Owner-occupiers who are UAE expatriates pay a Dubai Municipality housing fee of 5% of the property's annual rental value.
This fee is calculated based on the assessed annual rental value as determined by RERA's rental index, not the actual purchase price. For a villa with an assessed annual rental value of AED 150,000, the housing fee would be AED 7,500 annually.
The fee is automatically added to monthly DEWA utility bills in 12 equal installments, making it convenient for homeowners to pay. UAE nationals are exempt from this housing fee, while all expatriate property owners must pay regardless of occupancy status.
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Service charges for building maintenance are separate fees paid to property management companies, typically ranging from AED 10-30 per square foot annually for apartments and AED 5-15 per square foot for villas.
What taxes and fees apply to long-term residential rentals?
Long-term residential rentals in Dubai are subject to municipality housing fees paid by tenants, with no rental income tax for individual landlords.
Tenants pay the Dubai Municipality housing fee of 5% of their annual rent, automatically added to monthly DEWA bills. For annual rent of AED 80,000, tenants pay AED 4,000 annually (AED 333 monthly) as housing fees.
Individual landlords face no rental income tax on residential properties in 2025. However, corporate entities or individuals deemed to be conducting business activities may be subject to 9% corporate tax on rental profits exceeding AED 375,000 annually.
VAT does not apply to residential rental income, making long-term rentals tax-efficient for individual property owners. Landlords only pay standard service charges and property management fees.
What levies apply to short-term and holiday rentals?
Short-term rental operators face tourism dirham fees, municipality charges, and licensing requirements in 2025.
1. **Tourism Dirham Fee**: AED 10-15 per bedroom per night depending on property classification2. **Municipality Fee**: Additional AED 5-10 per bedroom per night for municipal services 3. **Licensing Fee**: AED 1,200-1,500 annually for short-term rental permits4. **VAT**: 5% on accommodation services for registered businesses5. **Platform Fees**: Additional charges from booking platforms (private costs)Holiday home operators must register with Dubai Tourism and obtain proper licensing before operating. Unlicensed short-term rentals face penalties of AED 50,000-100,000.
These fees are typically collected monthly through Dubai Tourism's online portal, with automatic calculation based on registered bookings and guest nights.
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How does VAT apply to Dubai property transactions in 2025?
VAT applies selectively to Dubai property transactions depending on property type and transaction nature.
Residential property sales are generally VAT-exempt, including both primary sales from developers and secondary market transactions. However, hotel apartments purchased directly from developers for first-time supply attract 5% VAT.
Commercial property sales and rentals are subject to 5% VAT, as are property management services, brokerage commissions, and legal fees. Property buyers should budget an additional 5% VAT on professional services even when the property itself is VAT-exempt.
Service charges paid to building management are subject to 5% VAT, while DLD transfer and registration fees remain VAT-exempt. Landlords renting commercial properties must register for VAT if annual revenue exceeds AED 375,000.
Does corporate tax apply to property income in Dubai?
Corporate tax of 9% applies to UAE property businesses with taxable income exceeding AED 375,000 annually, effective from June 2023.
Individual property owners holding real estate as personal investments are not subject to corporate tax. However, entities operating property businesses, frequent property traders, or companies holding rental portfolios may fall under the 9% corporate tax regime.
Property held through UAE companies, including those in Dubai's free zones (except qualifying activities), are subject to corporate tax on rental income and capital gains. Free zone entities with qualifying income may benefit from 0% corporate tax rates.
It's something we develop in our UAE property pack.
Determining corporate tax liability requires careful analysis of business structure and activity levels, making professional tax advice essential for significant property portfolios.
What taxes apply when selling Dubai property?
Property sales in Dubai are subject only to the 4% DLD transfer fee, with no capital gains tax, stamp duties, or other sale-related taxes.
Sellers typically pay 2% of the DLD transfer fee (by convention), NOC fees ranging from AED 500-5,000, and real estate agent commissions around 2% of the sale price. These are the only mandatory costs for property disposal.
Dubai imposes no capital gains tax on property profits, regardless of holding period or profit margins. This makes the emirate highly attractive for property investors seeking tax-efficient asset disposal.
Corporate entities may face different treatment under the 9% corporate tax regime, but individual property owners enjoy complete capital gains tax exemption when selling residential and commercial real estate.
What are the payment procedures and worked examples?
Property-related fees in Dubai follow specific payment channels with clear deadlines and penalty structures.
DLD fees are paid through Dubai REST app, DLD trustee centers, or authorized banks before property registration. Payment must occur within 60 days of sale agreement signing, or the transaction becomes void.
Municipality housing fees are collected monthly through DEWA bills, with late payment resulting in utility disconnection and reconnection fees of AED 100-300. VAT payments are made quarterly through the FTA portal for registered businesses.
**Mid-Range Apartment Example (AED 2,000,000 purchase):**- DLD transfer fee: AED 80,000 (4%)- Registration fee: AED 4,200- Title deed: AED 580- Mortgage registration (AED 1.5M loan): AED 4,040- Annual housing fee: ~AED 6,000 (5% of AED 120,000 rental value)- **Total upfront costs: AED 88,820**
**Villa Example (AED 5,000,000 purchase):**- DLD transfer fee: AED 200,000 (4%)- Registration fee: AED 4,200- Title deed: AED 580- Mortgage registration (AED 3.5M loan): AED 9,040- Annual housing fee: ~AED 15,000 (5% of AED 300,000 rental value)- **Total upfront costs: AED 213,820**
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Dubai's property tax structure remains one of the world's most investor-friendly systems, with zero annual property tax and no capital gains tax on real estate transactions.
While upfront costs including DLD fees and registration charges can reach 6-8% of purchase price, the absence of ongoing property taxes makes Dubai highly attractive for long-term real estate investment compared to global markets.
Sources
- Driven Properties - Property Service Charges & DLD Fees 2025
- Taraf Holding - DLD Fees in Dubai 2025
- Estate Magazine - Dubai Property Taxes Myths 2025
- SSG Seven Properties - Zero Property Tax in Dubai
- Strada UAE - Property Taxes & Fees Guide
- MyBayut - Dubai Housing Fee Calculation
- Property Finder - Dubai Housing Fee Guide
- Pantheon Development - Fees & Taxes in Dubai