Zero-rated supplies in the UAE include: exports of goods outside the UAE, international services (supplied to customers outside the UAE), international transportation and related services, first supply of residential buildings within three years of completion, certain healthcare services, and approved educational services. The critical distinction from exempt supplies: zero-rated businesses are still in the VAT system and can recover input VAT — meaning their costs are effectively VAT-free. This makes zero-rating commercially significant for export-oriented UAE businesses and healthcare or education providers.
Pro tip: If your business exports goods or services to customers outside the UAE, you should be charging 0% VAT on those supplies and reclaiming input VAT on your UAE costs. Many UAE exporters who are not VAT-registered are leaving significant input VAT on the table.
See also: VAT Exemption, Taxable Supply, Input VAT, VAT Refund
