VAT Guide launched to simplify tax compliance for UAE's construction sector
As the UAE's real estate sector continues to expand at an unprecedented pace, tax compliance has become a critical challenge for developers, contractors, property managers and home owners.
To provide clarity and practical solutions, Dhruva Consultants, a leading tax advisory firm in the Middle East, has launched a VAT Guide tailored for the real estate sector. The guide simplifies complex VAT regulations, offering real-world insights that is in sync with the Federal Tax Authority (FTA) guidelines.
Nimish Goel, GCC Leader, Dhruva, stated: 'With Dubai's real estate transactions surpassing Dh761 billion in 2024 — a 36% increase from the previous year — and Abu Dhabi witnessing a 24.2 per cent increase rise in real estate transactions in 2024 as compared to the previous year, the sector remains one of the most dynamic in the region. However, as projects grow in scale and complexity, so do the VAT implications, requiring developers, contractors, and property owners to adopt a more strategic approach to tax compliance.'
VAT mismanagement can lead to unexpected tax liabilities, project financing delays, and regulatory penalties. With multi-billion-dirham investments at stake, ensuring accurate VAT treatment is not just about compliance — it's about protecting financial margins and operational efficiency.
For master developers, it explores VAT implications for phased developments, infrastructure cost allocations, and strategies for maximizing input VAT recovery. Construction companies will find essential guidance on managing VAT for advance payments, handling contract amendments, and addressing the tax implications of project delays. Meanwhile, property managers and owners can gain clarity on tax treatments for leasing, service charge invoicing, and joint ownership arrangements, ensuring compliance while optimizing financial efficiency.
While the FTA has issued guidelines on VAT for real estate, Dhruva Consultants' guide incorporates industry-specific insights and practical case studies drawn from years of advisory experience with some of the UAE's largest real estate players. T
'At Dhruva Consultants, we believe in making tax simple,' said Goel. 'The UAE's real estate industry is evolving rapidly, and VAT compliance should not be a roadblock to growth. This guide is a strategic tool designed to empower developers, contractors, property managers and owners with clear, actionable knowledge, helping them navigate the complexities of VAT while ensuring financial optimization.'
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