Dubai continues to attract global buyers because property ownership comes with very low taxes. There is no annual property tax, no capital gains tax, and no personal rental income tax. This keeps long-term costs low for residents and international investors interested in business setup in Dubai.
At the same time, buyers must factor in transaction fees, registration charges, and municipal costs. This guide breaks down property tax in Dubai and what homebuyers and investors need to know to stay compliant.
Do I Have to Pay Property Tax in Dubai?
Dubai does not charge a traditional annual property tax. Instead, you pay a one-time transfer fee and regular community charges. Some fees, like the Dubai Municipality housing fee, may feel like a tax but they aren’t.
Service charges are paid to the building management or developer. These charges cover upkeep and are supervised by RERA, the Real Estate Regulatory Agency, a government body under the Dubai Land Department.
These are the main costs for property buyers in Dubai:
Fee Type | Rate | Notes |
DLD transfer fee | 4% of property value | Paid on purchase price or official value |
Title Deed registration | AED 2,000 to AED 4,000 + VAT | Based on property value |
Mortgage registration fee | 0.25% of loan amount | + AED 290 admin fee |
Agent/broker commission | 2% to 4% + VAT | Common in Dubai |
NOC fee | AED 500 to AED 5,000 | Paid to master developer, only for selling property |
Ongoing Municipal and Community Charges
Dubai has no annual property tax, but owners and tenants pay municipal fees and community charges. These fees support building maintenance, utilities, and community services.
Housing fee (Municipality fee)
- Calculated at 5% of the annual rental value
- Paid through the DEWA bill
- Tenants usually pay it, and owners pay it when the unit is vacant
Service and maintenance charges
- Paid by owners
- Calculated on a per square foot basis
- Covers security, elevators, landscaping, pools, and common area utilities
DEWA connection fees
- One-time deposit and activation fee
- Required for new connections or property handovers
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Do Commercial Properties Have Taxes?
Commercial properties have different rules. VAT applies to most sales and leases, and companies subject to Corporate Tax may be taxed on rental income.
VAT on Commercial Real Estate
- 5% VAT applies to sales and leases of commercial units
- Also applies to brokerage, consultancy, and related services
- Residential property sales remain exempt in most cases
Corporate Tax for Property-Owning Businesses
- Companies earning rental income above AED 375,000 may pay 9% Corporate Tax
- This does not apply to individuals who hold property in their personal name
- Businesses often need expert guidance to manage VAT registration, Corporate Tax, and rental income reporting.
Is Dubai Property a Good Investment?
Dubai’s low-tax environment makes it especially attractive for investors looking to maximize returns. With no annual property taxes and no capital gains tax, you get to keep more of what you earn.
There are a few reasons Dubai consistently stands out:
- Rental yields are strong, often averaging 6–8%
- No recurring property taxes to eat into your profits
- Growing demand from international buyers
- Reliable and transparent regulations under the Dubai Land Department
- Straightforward ownership rules in designated freehold areas
This is how Dubai compares to other countries in terms of property tax:
Country | Annual Tax |
USA | 1- 2% of property value |
United Kingdom | Annual council tax |
Canada | Municipal property tax |
About A&A Associate
A&A Associate is the UAE’s largest business setup advisory, offering end-to-end company formation support along with tax advisory, auditing, and accounting services in Dubai. Our team of seasoned consultants provides expert, reliable services for clients all across the UAE.
