Buying Property in Dubai: Taxes, Fees and Costs

Know the total budget before choosing the apartment

The apartment price is the starting point for your budget. Registration, transaction services, any bank costs and preparations after handover sit alongside it. They fall due at different stages, so seeing the payment dates is as useful as knowing the total.

We put these costs together while comparing projects. For Rota Prime’s off-plan sales, the developer pays our commission: the buyer pays no advisory fee or sales commission to us. Registration and other property expenses are shown separately.

Taxes and property expenses are different things

The UAE does not levy personal income tax. A property purchase still involves registration and service charges, and owning an apartment brings running costs such as building service charges, utilities and maintenance.

It helps to keep four groups separate: purchase registration, services needed for the transaction, any VAT on the relevant supply, and the costs of owning and letting the home. A clear budget shows each amount and who receives it.

DLD registration: the 4% total and who pays it

DLD lists a 2% seller share and a 2% buyer share of the sale value in its sale and initial-sale registration services. The contract determines how those costs are allocated in your purchase, including arrangements where the buyer covers the total 4%.

For an AED 1,000,000 home, 4% is AED 40,000. If the developer offers a registration incentive or covers part of the cost, it should appear in the written offer. We show the amount you are expected to pay in your property budget.

Off-plan registration and completed-property services

An off-plan sale is initially registered through Oqood. DLD’s initial-sale service lists an AED 1,000 developer self-registration fee, alongside knowledge and innovation fees. The developer’s written transaction breakdown shows which administrative amounts are included in your purchase.

A completed-property transfer uses a different service. DLD lists title and property-map charges, plus Registration Trustee charges of AED 4,000 plus VAT for sales of AED 500,000 or more, and AED 2,000 plus VAT below that value.

These are useful distinctions when comparing ready and off-plan homes. We use the fee schedule for the actual transaction rather than automatically adding completed-property Trustee charges to an off-plan reservation.

Your sales commission with Rota Prime

You do not pay us an advisory fee or sales commission for an off-plan purchase. Our commission is paid by the developer.

We can sometimes secure a more favourable price than a direct developer purchase, depending on the project. The agreed price and incentives are confirmed in writing. Rental and property management after handover are separate services, with their scope and fee agreed at the outset.

If your purchase includes a mortgage

A bank may charge for valuation, processing and insurance. Those amounts are set out in its offer. Mortgage registration has a separate DLD fee, generally 0.25% of the mortgage amount, with any applicable fixed charges shown in the transaction breakdown.

If finance is intended at handover, we consider the cash required for the developer’s remaining balance together with the planned bank loan. Approval and lender charges depend on the property and your circumstances, so the budget is based on the offer available to you.

Where VAT applies

VAT on property and VAT on a service invoice are separate questions. Commercial property is generally subject to the standard 5% rate. Residential supplies have their own rules: the first supply of a new residential building within the prescribed period can be zero-rated, and later residential supplies are generally exempt.

Services such as transaction processing, management and maintenance may include VAT. The invoice and written cost breakdown identify the amount and the service it relates to. We clarify the treatment for the home and services being purchased rather than using one percentage for everything.

Personal property investment and corporate tax

The Federal Tax Authority distinguishes a natural person’s qualifying real estate investment from a licensed business activity. Investment carried out without requiring a business licence can fall outside UAE corporate tax.

Ownership through a company or a licensed property business follows a different tax framework. Tax reporting in your country of residence is also considered separately. Your ownership structure should therefore be clear before the property documents are prepared.

Building service charges

Service charges cover the shared running costs of the building, such as common-area maintenance, cleaning and security. Amenities, building size and the way services are provided all affect the amount.

DLD’s Service Charge Index provides approved project information. For completed buildings we can review the available charges; for off-plan homes, the developer’s current estimate is considered alongside the facilities planned. The unit used in the quote also matters: an amount per square foot should not be read as an amount per square metre.

Service charges are part of the annual property budget. We put them next to expected rent, management and maintenance costs so you can see the income remaining after the apartment is let.

Other costs to include

At the transaction stage, a resale may involve a developer NOC, mortgage discharge, power of attorney or translation. An international transfer can involve sending and intermediary-bank fees. The required items depend on the way you buy.

At handover, utilities and deposits, district cooling where relevant, insurance, furnishing and the first letting preparations may be needed. These can be planned before completion so the apartment is ready for its intended use.

• Purchase and registration charges.
• Any bank, document and transfer costs.
• Utilities, cooling and furnishing at handover.
• Building service charges, maintenance and management.
• The period between handover and the first tenant.

When the costs fall due

Ready-property purchases tend to bring several transaction costs together at transfer. Off-plan spreads the property-price payments over the agreed plan, with registration paid at the relevant stage and running costs arising around handover.

We show the initial cash requirement, construction instalments, handover balance and first-year preparations separately. If your funds are held abroad, transfer timing and the exchange rate into AED are included in that plan.

Tax reporting where you live

Your home country may have rules for reporting overseas property income and gains. The relevant treatment depends on tax residence, ownership and applicable agreements. We keep this separate from the UAE property expenses so your local tax adviser can complete that part of the budget.

An example budget for an AED 1,000,000 off-plan home

This example assumes a 20/40/40 payment plan and a contract under which the buyer covers the total 4% registration cost. It shows the main price and registration amounts, with project-specific administrative and handover costs added in the written quote.

The three price payments total AED 1,000,000; they are not extra charges on top of that price. Registration adds AED 40,000 in this example. Developer administrative charges, utilities, furnishing, management and any financing are separate lines in the complete budget.

A clear cost breakdown for your chosen apartment

Before reservation, we can show the price, incentives, fee allocation and payment dates together. As the purchase progresses, that same budget becomes the reference for registration and handover.

• Which registration charges does your contract allocate to you?
• Which developer or transaction service fees apply?
• Is VAT included in each service invoice?
• What is payable at handover?
• What annual building and management costs are expected?
• Which bank, currency-transfer and home-country tax costs relate to your situation?