Is VAT charged on commercial property in the UAE (purchase and lease)?

Yes. In the UAE, the supply of commercial property is generally subject to VAT at the standard rate of 5%, administered by the Federal Tax Authority (FTA). This applies to both sale and lease — buying an office, selling a warehouse, or renting out a retail unit all fall inside the VAT net. Commercial property means non-residential real estate: offices, shops and retail units, warehouses, hotels and similar. Residential property is treated separately under the UAE VAT framework, so the rules that apply to a home do not tell you how an office is taxed. Who charges it. A VAT-registered seller or landlord normally charges the 5% on the price or the rent and accounts for it to the FTA. A VAT-registered buyer or tenant using the property for taxable business activity may be able to recover that VAT as input tax, depending on their use of the property and their registration status. There are also specific mechanisms for supplies of commercial property between VAT-registered parties that change how the tax is handled in practice. Before you sign. Confirm both parties' VAT registration status. Make sure a proper tax invoice is issued. Check whether any special treatment applies — for example a transfer of a going concern, or a property located in a designated zone. Registration thresholds, reverse-charge treatment and recovery rules are all set by the FTA and turn on your own circumstances, so confirm the exact position on the FTA portal or with a tax adviser before completing. As a next step, check your VAT registration position with the FTA. If the contract is significant, you can also compare verified UAE legal and tax professionals on LEXAI to review the structure before you sign.