Comprehensive Guide: Taxes and Fees on Buying Property in the UAE (2025)

When considering buying property in the UAE, it’s important to understand all the associated taxes and fees to avoid financial surprises. While the UAE does not impose income tax or capital gains tax, there are several government, financing, and administrative fees to account for.

1. Property Transfer Fee

Dubai: 4% of the property value, usually paid fully by the buyer.
Example: For a property worth AED 1,000,000 → transfer fee = AED 40,000.

Abu Dhabi: 2% of the property value.

Sharjah: Around 2%.

2. Registration & Administrative Fees

Property under AED 500,000: AED 2,000 + 5% VAT.

Property over AED 500,000: AED 4,000 + 5% VAT.

Title deed issuance: AED 250–580.

Oqood Fees (off-plan): Initial registration fees + ~AED 40 admin cheque.

3. Municipality / Housing Fees

Dubai: 5% of the annual rental value (paid by tenant, or owner if vacant).

Abu Dhabi: 3% for residential, 4% for commercial properties.

Sharjah: 2%–10% depending on property type.

4. Value Added Tax (VAT)

Residential properties: Exempt from VAT.

Commercial properties: 5% VAT on sales, leases, and related services (e.g. agencies, maintenance).

5. Real Estate Agent Commission

Typically 2% of property price + 5% VAT.

6. Mortgage & Financing Costs

Loan arrangement fee: ~1% of loan amount + 5% VAT.

Valuation fee: AED 2,500–3,500 + 5% VAT.

Mortgage registration: 0.25% of loan amount + AED 290 admin fee.

Life/property insurance: Required by some banks at ~0.4%–0.8% annually.

7. Other Possible Fees

Developer admin fee (off-plan): AED 3,000–5,000 (varies by project).

Annual service charges:

Apartments: AED 10–30/sq.ft per year.

Luxury villas: AED 40–50/sq.ft or more.

Trustee fees (safe transfer):

Below AED 500,000: AED 4,000–6,000.

Above AED 500,000: AED 8,000–10,000.

8. Key Changes Since 2025

As of February 2025, banks stopped financing:

Dubai Land Department (DLD) transfer fee (4%)

Agent commission (2%)

➡️ Buyers must now pay these fees in cash, in addition to the 20–30% down payment.

This means an extra 6% of the property value must be prepared upfront.

9. Summary Table (Dubai Example)

Fee TypeAmount/RateProperty Transfer (DLD)4% of property valueRegistration FeeAED 2,000–4,000 + 5% VATTitle DeedAED 250–580Municipality/Housing Fee5% of annual rentAgent Commission + VAT2% + 5% VATLoan Arrangement Fee1% + 5% VATValuation FeeAED 2,500–3,500 + 5% VATMortgage Registration0.25% of loan + AED 290Annual Service ChargesAED 10–50/sq.ftTrustee FeesAED 4,000–10,000Extra Cash Required (2025)~6% of property value

💡 Conclusion & Recommendations

The UAE remains a highly attractive real estate investment destination thanks to the absence of income tax and capital gains tax.

However, buyers must carefully calculate fees to set the right budget before purchasing.

With the 2025 changes, buyers now need to prepare an extra 6% of the property value in cash, in addition to the down payment.

It is always recommended to consult a licensed real estate agent and financial advisor to understand the full costs and ensure transparency.