VAT on Gold in UAE: Rates, Exemptions and Rules in 2025 

Dubai, famously known as the City of Gold, has long been a global hub for precious gems and metals, attracting investors from around the world who want to start gold trading here. The recent changes in VAT on gold in UAE have brought a dynamic transformation in the market, implementing key exemptions for certain types of gold and new regulations for B2B transactions.

These new changes aim to enhance the financial appeal of gold trading in the UAE by reducing costs and improving cash flow management. If you are also interested in gold trading in Dubai, then you must know about these new measures related to VAT on gold in UAE. 

This comprehensive guide explores key information related to VAT on gold UAE, including the exemptions, updated VAT rules, eligibility criteria, compliance requirements, and other relevant details to help you navigate this landscape seamlessly. 

What is VAT or Value Added Tax in the UAE? 

VAT, also known as a consumption tax, is a form of indirect tax levied at a standard rate of 5% on most goods and services. VAT is usually applied at each stage of the supply chain, with the final cost borne by the consumer.  

As per the guidelines of the UAE’s Federal Tax Authority (FTA), businesses impose VAT on supplies and collect the tax money on behalf of the government. On the other hand, certain sectors like residential properties, bare land transactions, etc., are exempted from paying VAT. 

Understanding gold VAT in UAE 

The regulations governing gold VAT UAE are designed to support the country’s status as a global hub for the gold and precious metals market. On most gold transactions in UAE, a standard 5% VAT is applied.  

However, exemptions exist for investment-grade gold that holds a purity of 99% or higher. Additionally, this exemption applies only to B2B (business-to-business) transactions and not end-consumer purchases.  

Furthermore, a reverse charge mechanism (RCM) is implemented for B2B transactions, where businesses can account for VAT without immediate cash payments. This not only reduces the financial burdens of the traders and investors but also enhances the competitiveness of the UAE in the global gold market. 

Eligibility for exemption from UAE VAT gold

Only those gold transactions are eligible for VAT exemption that meet specific conditions set forth by the FTA. For example: 

• High-purity metals: Gold, silver, and platinum products that meet the minimum purity threshold of 99%.  
• Investment-grade products: Investment-grade items that meet the purity requirement. For example, gold bars, coins, or bullion. Gold jewellery is not eligible. 
• Registered businesses: Transactions between VAT-registered suppliers and recipients within the UAE. Retail sales made to end consumers do not qualify. 
• Purpose: The gold must be purchased for either investment or resale purposes. Gold bought for personal use or manufacturing jewellery does not qualify for exemption for VAT on gold in UAE. 

Conditions for businesses to qualify for VAT exemption on gold

Gold businesses that meet strict compliance standards and maintain detailed records can benefit from the VAT exemption :

• Comprehensive transaction records: Businesses must maintain clear and accurate transaction records, such as VAT invoices, proof of eligibility for VAT exemption, and other supporting documents.  
• Proof of VAT registration: Both the buyer and seller of gold must be registered for VAT with the FTA and have supporting documents confirming their eligibility.  
• Adherence to UAE Tax Laws: Businesses must strictly comply with the tax laws and regulations in the UAE to avoid penalties and stay eligible for the exemption.  

Documents required to apply for VAT exemption on gold 

To claim VAT exemption on gold in UAE, you must have the following documents ready with you: 

1. Tax invoices:

A detailed tax invoice for every transaction, including the following details: 

• Details of the supplier – Name, address, and Tax Registration Number (TRN). 
• Details of the buyer (for B2B transactions) – Name and address. 
• Description of goods or services or any related making charges. 
• Date of supply and date the invoice was issued. 
• Price breakdown, including making charges, the cost of goods, and VAT charged. 
• Any reverse charge mechanism applied. 

2. Certificates of authenticity:

For transactions involving VAT-exempt gold, to verify the purity of gold, to claim VAT refunds, or to document exemptions in tax returns.

3. Proof of VAT registration:

Tax Registration Numbers (TRN) of both the buyer and seller to confirm their VAT registration, to apply the reverse charge mechanism in B2B transactions. 

Sales and purchase contracts: Details supporting high-value transactions, such as:

• The nature of the supply. 
• The value of gold. 
• Any related making charges. 
• VAT treatment for the transaction. 

Import and export documentation: Customs documents for imports, specifying: 

• The value of import. 
• Appropriate customs duties. 
• VAT treatment for imported goods

Documents such as shipping invoices for exports, confirming that goods have left the UAE, and that they qualify for VAT exemptions. 

4. Bank statements and proof of payment:

Copies of bank statements or proof of payment to validate the values stated on tax invoices. 

Please note that the documentation requirement may vary. It is best to consult VAT experts such as Dubiz VAT services for better guidance. 

What are the key benefits of exempting VAT on gold in UAE? 

The exemption of VAT on gold transactions has brought significant advantages for businesses as well as the UAE economy:  

• Enhancing market attractiveness: Eliminating VAT from gold transactions makes investing and trading in gold and other high-purity precious metals more attractive.  
• Encouraging high-volume trades: Exempting Gold VAT in UAE helps in reducing transaction costs, which increases trading volume in the gold market and attracts global businesses and investors.
• Supporting economic growth: With the revised VAT regulations, the UAE plans to lead the global gold market, directly contributing to its economic progress.  
• Simplified operations for gold traders: The removal of VAT-related costs reduces financial burdens, streamlining business operations for gold traders and jewelers. This encourages more transactions within the UAE’s gold market. 
• Enhanced appeal for investors: The tax-free pricing makes gold an attractive investment option, enhancing its appeal as a secure and rewarding asset.  
• Benefits for consumers: The improved affordability of gold and precious metals in the market ensures better pricing options for buyers. 

Are you considering investing in the UAE’s gold market? 

Here are some essential tips and best practices that will help you understand and stay compliant with the evolving gold VAT landscape:

1.Stay updated on tax regulations:

Regulations for the gold VAT rate in Dubai tend to change over time. Hence, businesses must regularly consult official sources or professional tax advisors to ensure compliance.

2. Document compliance:

Businesses must make sure to meet the eligibility criteria and keep meticulous records to ensure that their business activities and practices align with tax regulations, and they can reap maximum benefits from VAT exemption.

3. Monitor market trends:

The exemption of VAT on Gold in UAE can impact the demand and pricing of gold in the market. Therefore, it is crucial to stay aware of these changes to make informed decisions regarding gold trading and investments. 

Updated rules on UAE VAT on gold 

Cabinet Decision No. (127) of 2024, introduced by the UAE Ministry of Finance, defines the scope of the Reverse Charge Mechanism (RCM) for VAT-registered businesses that deal in gold, precious metals, and stones. Previously, the RCM was limited to transactions involving gold and diamonds among registered suppliers. 

Under the revised rules of VAT on gold in UAE, registered suppliers do not have to charge VAT on sales. Instead, the registered buyers will have to report and pay the VAT directly in their VAT returns.   

The authorities have employed these changes to eliminate direct VAT payments on qualifying transactions and simplify compliance for businesses, thus enhancing their cash flow and supporting the thriving precious metals and gemstones sector in the UAE. 

Gold VAT rate in Dubai: Changes in making charge

In Public Clarification VATP032, the Federal Tax Authority states the revision of the tax treatment of gold jewellery making services. It clarifies the application of VAT to the making charges of gold jewelry. 

1.Composite supply definition:

As per the new VAT rules, if the gold product and making services are billed together, the transaction will be treated as a whole for VAT purposes. This simply means that the making charges will be considered as part of a single composite supply, and the reverse charge mechanism can be applied if all conditions are duly met, such as recipient registration, usage of gold products, and supplier declaration. 

2.Compliance implications:

All gold transactions must be supported by appropriate documents, including detailed tax invoices specifying the total value of gold and related services. 

Conclusion: Gold VAT UAE 

Thus, with the revised VAT framework on gold transactions, the UAE aims to streamline business operations and enhance its global appeal as a hub for gold, diamond, and precious metals. It supports gold traders and buyers by implementing specific exemptions for investment-grade gold and a reverse charge mechanism for B2B transactions.  

Hence, by understanding and complying with these regulations, gold businesses can ensure smooth operations and stay away from any legal penalties and consequences. 

How Dubiz can help 

Dubiz advisory team has deep expertise in UAE tax laws and a comprehensive understanding of the UAE’s VAT regulations. Through their extensive knowledge and invaluable support, they can help you understand the specific VAT implications for your business setup in Dubai, minimize tax liabilities, and build a strong foundation for your long-term success. 

 Contact Dubiz today. 

📞 Call: +971 56 369 5485     

💬 WhatsApp: +971563695485     

📧 Email: info@dubiz.co     

Note: The content in this blog post is for informational purpose only and is subject to changes made by concerned government authority or the FTA.  

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