How to Pay VAT in the UAE: Payment Methods and Deadlines

VAT was introduced in the UAE on January 1, 2018, at 5% on taxable supplies, subject to the applicable rules for zero-rated, exempt and other transactions.

VAT registration is mandatory for businesses whose taxable supplies and imports exceed AED 375,000 over the previous 12 months, or are expected to exceed that threshold in the next 30 days.

A business may register voluntarily if its taxable supplies, imports or taxable expenses exceed AED 187,500 under the applicable rules.

Businesses required to register must submit their VAT registration application within 30 days of becoming required to register.

What does payment of VAT actually mean?

Payment of VAT is the step where a VAT-registered business settles the amount it owes as shown in its VAT return filed with the Federal Tax Authority (FTA).

The VAT return calculates the business’s net VAT position for the tax period:

• Output VAT collected on taxable supplies
• Less eligible input VAT incurred on business purchases and expenses
• Resulting amount may be VAT payable or refundable. VAT payment is the net difference of output VAT less eligible input VAT.

Generally, VAT is charged at each stage of the supply chain where value is added.

Filing the return and paying the VAT are connected but separate compliance steps. A business that submits its return but does not settle its VAT liability within the due date will result in an unpaid tax, subject to penalties.

When is UAE VAT payment due in a tax period?

The FTA states that VAT returns and related VAT payments are due within 28 days from the end of the tax period. The tax period is the reporting period for which VAT is calculated and reported.

The standard VAT tax period is generally three calendar months, although the FTA may assign a different tax period, including monthly periods, to certain taxable persons.

The exact due date should not simply be guessed from the calendar month. Businesses should check:

• their VAT registration information;
• the VAT return details; and
• the Required Actions section of their EmaraTax account.

If the normal deadline falls on a weekend or public holiday, the deadline moves to the next working day under the applicable rules

Practical Note

Businesses should treat the due date as the date FTA needs to receive the payment, rather than the date that the business initiates a bank transfer. Most VAT penalties come from something as trivial as delayed banking services rather than severe VAT violations.

Tax Invoices and Return Filing

A tax invoice is an important record for VAT reporting.

For a full tax invoice, the supplier’s name, address and Tax Registration Number (TRN) must be included.

When dealing with many UAE businesses, checking VAT registration details across multiple suppliers and customers can become tedious, particularly when reviewing large volumes of invoices before return filing.

The Federal Tax Authority (FTA) provides a TRN verification facility, allowing businesses to check whether a TRN is valid.

This matters when reviewing input VAT because a valid tax invoice is an important document supporting the VAT treatment and any input tax recovery claimed.

Businesses should therefore avoid assuming that every invoice should simply have standard rate 5% VAT added. The VAT treatment depends on the nature of the supply, including whether it is taxable, zero-rated, exempt or otherwise outside the scope of UAE VAT.

Completing your Value Added Tax (VAT) Obligations: Options for VAT Payment

Unpaid VAT liabilities can be paid through the payment channels available through the FTA, including GIBAN and MagnatiPay.

Take note that businesses must generally maintain VAT records for at least five years, although longer retention periods may apply for certain records, such as real-estate-related records. Good VAT compliance practice includes reconciling relevant accounts before filing returns.

What are the payment methods for VAT?

Direct online portal payments are common for VAT across many jurisdictions. The main payment routes available through the FTA are GIBAN and MagnatiPay.

Pay VAT through GIBAN

GIBAN is a unique IBAN associated with the taxpayer’s FTA tax account and is used for tax payments.

1. For GIBAN payments, the taxpayer must first log into EmaraTax.
2. Select the relevant VAT liability or liabilities to be paid.
3. EmaraTax generates a unique payment reference number (PRN).
4. The payment must include:
   • the relevant GIBAN;
   • the unique payment reference number; and
   • the exact amount payable.

The FTA specifically warns that GIBAN payments made through UAE financial institutions without the required reference number and exact amount will not be accepted.

Payment can be made through UAE-based financial institutions, including online banking, bank tellers, and exchange houses. Businesses should retain their payment receipt and check the payment status in EmaraTax.

Pay through MagnatiPay

MagnatiPay is the FTA’s current online payment gateway for payments through EmaraTax.

MagnatiPay accepts VISA and Mastercard prepaid, debit and credit cards. This makes it easier for owners looking to pay their outstanding tax by card.

However, MagnatiPay charges an extra service fee, which is about 0.68% of the transaction value.

What happened to eDirham?

The eDirham payment gateway was decommissioned on 30 October 2022 and is no longer accepted for FTA tax payments.

What happens after late VAT payment?

Late Payment Penalties and VAT Fines

Late VAT payment can result in a penalty on the unpaid tax.

Under the amended UAE tax administrative penalty framework effective from 14 April 2026, late VAT payment is subject to a penalty of 14% per annum, calculated for each month or part of a month on the unsettled Payable Tax amount from the day after the payment due date and monthly thereafter. If part of the VAT is paid, future penalties apply only to the remaining unpaid amount.

A separate rule applies when additional VAT becomes payable following a voluntary disclosure or FTA tax assessment. Taxpayers are given 20 business days to settle the additional tax before late-payment penalties begin. After that period, the same penalty scheme applies.

Can you pay VAT Administrative Fines in installments?

The Tax Procedures Law allows for administrative penalties to be paid in installments, subject to the applicable approval process. There is a specific EmaraTax service you can use to request partial payments, but this must clear and approved by the due date.

Only unsettled administrative penalties are eligible for a penalty installment plan, and the application must generally include at least AED 50,000 of outstanding administrative penalties within a single tax type. Therefore, VAT liability should still be paid by the applicable due date.

Any request submitted to the FTA portal may take up to 110 business days to review.

VAT Compliance Mistakes many Businesses should avoid

VAT-registered taxable persons must file their VAT returns and make related VAT payments within 28 days of the end of the relevant tax period to avoid penalties.

• Waiting until the last day
  • Bank transfers can take time to process.
  • Build payment time into financial planning rather than treating the deadline as the day to initiate payment.

• Using outdated e-Dirham instructions
  • e-Dirham is no longer the FTA’s payment gateway.
• Using the wrong GIBAN
  • Confirm that the payment is being made against the correct tax account.
• Forgetting the payment reference number
  • GIBAN payments require the unique reference number generated through EmaraTax.
• Paying the wrong amount
  • The FTA requires the exact amount linked to the payment reference number for GIBAN payments.
• Not checking whether the payment was received
  • EmaraTax provides payment history/status information. Payment receipts can also be retrieved from the relevant EmaraTax sections.
• Treating VAT collected from customers as ordinary cash
  • Operationally, businesses should account for output VAT separately when planning cash flow so the money needed for the eventual VAT payment is available.
  • This is a practical accounting point rather than a claim that VAT must legally sit in a separate bank account.

How accounting systems can help businesses avoid late VAT payment

Staying on top of VAT compliance is easier when records, invoices and supporting documents are organized throughout the year rather than pulled together at the last minute.

Accounting systems can help businesses track transactions, VAT treatment and taxation deadlines, while Skrooge uses AI to process documents and flag issues such as missing TRNs or other evidence gaps.

An expert accountant then reviews the VAT return before submission, giving businesses clearer visibility of their VAT liability in advance. This gives your business more time to plan ahead and avoid late payments.