The Gold Tax in UAE is an essential issue to jewellery buyers, bullion investors, and gold dealers in the context of VAT, reverse charge, and refunds in 2025. This guide describes what is taxed, what is zero-rated, who can claim VAT refunds on gold, and how businesses should comply with practical tips and UAE-specific updates. My Taxman is a UAE-based advisory firm that offers end-to-end VAT compliance, corporate tax, accounting, and advisory services to individuals and companies involved in gold and precious metals transactions
The general VAT rate is 5% on most goods and services, and this applies to gold jewellery and non-investment gold bought at retail in the UAE.
Precious metals that are investment grade may be zero-rated when they satisfy certain purity and form requirements, and no VAT is charged at the point of sale, but input VAT is recoverable by businesses.
The UAE does not charge any personal income Tax or capital gain tax on individual gains on gold investment, and this keeps the investment environment appealing, but VAT rules still apply to supplies.
Investment-Grade vs Jewellery: How Gold is Taxed
Zero-rated investment gold: Gold of at least 99% purity (usually 24K) in tradable forms, such as bars or coins, is zero-rated provided it is correctly classified and documented by the supplier.
Jewellery and non-investment gold: 18K, 21K, and 22K ornaments (chains, bangles, rings, pendants) are normally liable to 5% VAT on the entire invoice, including the value of gold, making/designing charges, and service charges.
Retail examples: A 24K bullion bar bought at a certified dealer may be zero-rated provided it fulfills the statutory requirements, whereas a resident individual buying a 22K necklace will normally be liable to pay 5 percent VAT.
2025 Update: Reverse Charge Expansion for Precious Metals and Stones
Starting 25 February 2025, the reverse charge mechanism (RCM) is extended to more precious metals and stones between VAT-registered businesses in the UAE, replacing Decision No. 25 of 2018.
The scope now includes transactions in gold, silver, platinum, palladium, natural/synthetic diamonds, pearls, and key gemstones, including jewellery where the precious elements have a higher value than other materials.
Motive: to simplify VAT operations, be in line with best practices, and improve market competitiveness; VAT-registered buyers would account for VAT under RCM instead of paying it in advance on qualifying B2B transactions
Making charges: How Pricing Affects VAT
Making charges are design/labour fees charged on jewellery and are usually included in the retail invoices in Dubai.
In the event of gold items and making services being a single composite supply (price not split, same supplier, making charges ancillary), the buyer will account for VAT under RCM on the total value in qualifying B2B cases.
Treated as multiple supplies (charged separately identified), the supplier charges 5% VAT on making charges, and the buyer accounts for gold under RCM, where conditions apply.
VAT Refunds on Gold: Tourists, Businesses, and Exporters
Tourists: Gold jewellery bought under 5% VAT may qualify under the UAE tourist refund scheme when the procedures are followed.
Businesses registered for VAT: VAT on qualifying costs (e.g., security, transport, display equipment) can be reclaimed; VAT on imports can be offset by RCM on qualifying investment-grade imports; excess input tax can be claimed as a repayment.
Exporters and bullion traders: Zero-rated supplies and RCM transactions often result in a refund position because of low output VAT compared with input VAT- documentation is critical.
Compliance Checklist for Businesses Trading Gold in the UAE
Ensure proper treatment of investment-grade and non-investment gold by providing supporting documentation and evidence of purity.
Where applicable: In the case of qualifying B2B transactions involving precious metals and stones as per the 2025 expansion, buyers will be liable to VAT on a reverse charge basis; input and output VAT must be reported appropriately.
Charges policy: Determine whether supplies are composite or multiple and invoice accordingly; this has a direct effect on the VAT treatment of making charges as opposed to gold components.
Input VAT recovery: Monitor VAT on qualifying expenses (transport, security, storage, display) and submit VAT returns in a timely manner to maximize refunds and cash flow.
Trade through regulated channels: regulated trading and compliant documentation will facilitate proper zero-rating and RCM practice.
How My Taxman can help
End-to-end VAT solutions: VAT registration, VAT returns, compliance, and advisory services specific to gold retail, wholesale, and import/export business.
Corporate tax and finance advisory: Combined tax planning, accounting, and CFO services to manage documentation, cash flow, and refund positions of gold-related businesses.
UAE-specific assistance: An exclusive team of experts on VAT on gold in the UAE, VAT refunds on gold, and operational compliance with the 2025 reverse charge expansion and FTA guidance.
FAQs
Does jewellery in the UAE have VAT on gold?
Yes. Jewellery and non-investment gold are normally charged 5 percent VAT on the total invoice value.
Are gold bars and coins zero-rated?
Yes, provided that they are investment-grade: 99% or more purity and tradable forms like bars/wafers/coins with proper classification and documentation.
Are VAT refunds available on gold jewellery to tourists?
Yes, as long as the UAE tourist refund scheme procedure is in place when VAT is charged at the point of sale.
What will be different in 2025 that businesses need to know?
The scope of reverse charge will be expanded on 25 February 2025 to include precious metals and stones on B2B transactions between VAT-registered businesses, overriding the previous 2018 ruling.
What is the tax treatment of making charges?
When part of a single composite supply with gold in qualifying B2B supplies, RCM may apply to the entire value; when invoiced separately as multiple supplies, making charges are normally 5% VAT, whereas gold may be under RCM where conditions are met.
Conclusion
My Taxman automates all processes and procedures- VAT registration, VAT returns, reverse charge, input VAT recovery and audit ready records to retailers, wholesalers and investors in precious metals. To get customized advice on vat on gold in UAE and maximized VAT refunds on gold as per the new regulations, contact My Taxman to protect margins, streamline refunds, and remain fully compliant. Contact My Taxman at +971-543223140 to unlock the competitive advantage of compliance.
