The UAE tourist VAT refund scheme lets eligible overseas visitors reclaim the 5% VAT paid on qualifying goods they buy and export as personal luggage. It operates under Cabinet Decision No. 41 of 2018, with a maximum cash refund of AED 7,000 per tourist every 24 hours under FTA Decision No. 1 of 2019. Abdelhamid & Co (MOE LC0106-01, FTA TAN 30003958) advises Dubai and Sharjah retailers.
What the Tourist VAT Refund Scheme Is
The Tourist Refund Scheme (TRS) is the mechanism by which the Federal Tax Authority refunds VAT to an overseas tourist on goods purchased from registered retailers and exported from the UAE. Cabinet Decision No. 41 of 2018 created the legal basis, and the FTA Chairman set the start date — the scheme launched in late 2018 and is operated through a contracted operator at airports, land borders and seaports. It is part of the wider UAE VAT system under Federal Decree-Law No. 8 of 2017.
Who Qualifies as an Overseas Tourist
Under the decision, an "overseas tourist" is a natural person who is not resident in the UAE or any other GCC implementing state and who is not a crew member of a flight or voyage leaving the UAE. The visitor must export the goods within the period set by the FTA and have them validated before departure. UAE residents and GCC nationals living in the country do not qualify.
Key Figures of the Scheme
| Item | Detail |
|---|---|
| Legal basis | Cabinet Decision No. 41 of 2018 on the Tourist VAT Refund Scheme |
| Standard VAT rate | 5% on most goods |
| Maximum cash refund | AED 7,000 per overseas tourist per 24 hours (FTA Decision No. 1 of 2019, from 1 June 2019) |
| Minimum spend | AED 250 per tax invoice (published scheme requirement) |
| Who pays the VAT first | The tourist, at the registered retailer's point of sale |
How the Refund Works in Practice
A tourist shops at a participating, VAT-registered retailer — for example in Dubai Mall or a Sharjah outlet — and the retailer issues a tax invoice and a tax-free tag linked to the purchase. On leaving the UAE, the tourist validates the goods and tags at the airport (such as DXB) using the operator's self-service kiosks or validation points. After validation, the VAT is refunded, either back to the tourist's card or in cash, subject to the AED 7,000 cash cap per 24 hours and the operator's service fee.
Example: a visitor buys a watch in Dubai for AED 5,250 including AED 250 VAT, requests a tax-free tag at the till, validates it on departure, and receives the eligible refund to the original card.
What Retailers Must Do
To take part, a retailer must be VAT-registered and integrated with the appointed operator. At the point of sale it issues a valid tax invoice, captures the tourist's passport details, and generates the tax-free tag. Retailers must keep accurate records to support their VAT returns; the output VAT is still declared, and the refund is administered through the operator rather than netted off informally. Our VAT return filing team helps retailers reconcile TRS sales correctly.
Common Mistakes and Risks
Common issues include issuing tax-free tags to non-eligible residents, missing the minimum-spend or validation requirements, poor passport-data capture, and failing to reconcile TRS refunds with the VAT return. These create both compliance exposure and unhappy customers. A targeted VAT compliance review aligns your retail process with the scheme.
Why Choose Abdelhamid & Co
From our Sharjah office, our FTA-registered Tax Agency (TAN 30003958, TAAN 20033908) and Ministry of Economy licensed firm (LC0106-01) supports retailers across Dubai, Sharjah and the UAE on TRS integration, record-keeping and VAT return reconciliation, in Arabic and English.
Who can claim a VAT refund under the UAE tourist scheme?
Only an overseas tourist — a natural person who is not resident in the UAE or another GCC implementing state, and who is not a crew member — can claim. The goods must be validated and exported within the period set by the FTA.
What is the maximum cash VAT refund for tourists in the UAE?
Under FTA Decision No. 1 of 2019, effective from 1 June 2019, the maximum cash refund is AED 7,000 per overseas tourist per 24 hours. Refunds above that are made to a card rather than in cash.
What is the minimum spend for a UAE tourist VAT refund?
The published scheme requirement is a minimum purchase of AED 250 per tax invoice from a participating registered retailer, with a tax-free tag issued at the point of sale and validated before the tourist leaves the UAE.
What must a Dubai retailer do to join the tourist refund scheme?
The retailer must be VAT-registered and integrated with the appointed operator, issue a valid tax invoice, capture the tourist's passport details, generate the tax-free tag, and reconcile TRS sales in its VAT return.
Related Services
- VAT Compliance Review — TRS process and record review for retailers
- VAT Return Filing — reconciling tourist-refund sales
- Tax Agency Service — FTA representation for retail businesses
For the official legislation see the Federal Tax Authority and the Ministry of Finance, or read more on our Insights page.