UAE Tourist VAT Refund Scheme Updated in 2026: Everything Tourists and Retailers Need to Know
Are you travelling to the UAE for shopping? If you purchased luxury watches from Abu Dhabi, gold jewellery from Dubai or electronic devices from Sharjah, you might be eligible to recover the 5% Value Added Tax (VAT) paid on your purchases before leaving the country.
The Federal Tax Authority (FTA) has recently updated the Tourist VAT Refund Scheme through Federal Tax Authority Decision No. 11 of 2026, which amends FTA Decision No. 2 of 2018. One of the major changes is the reduction in the fixed administrative fee charged per refund claim, making the scheme even more attractive for international visitors.
In this blog, we explain how the Tourist VAT Refund Scheme in the UAE works, who is eligible, the latest amendments in 2026, and what retailers need to do to stay compliant.
What is the UAE Tourist VAT Refund Scheme?
The UAE Tourist VAT Refund Scheme allows eligible international tourists to claim the refund of 5% VAT they paid on goods purchased from participating retailers before leaving the country.
The scheme was actually introduced through Cabinet Decision No. 41 of 2018 and implemented by Federal Tax Authority Decision No. 2 of 2018. Since then, it has undergone several amendments, including:
- FTA Decision No. 9 of 2023
- FTA Decision No. 2 of 2024
- FTA Decision No. 11 of 2026 (effective 12 July 2026)
The key objective is to encourage tourism in the UAE, enhance the level of shopping experience and to make UAE as one of the world's leading destinations for retailers.
What Changed Under FTA Decision No. 11 of 2026?
The most important amendment introduced by FTA Decision No. 11 of 2026 is the reduction of fixed administrative fee levied on each VAT refund claim.
Administrative Fees (Effective 12 July 2026)
The FTA will deduct:
- 13% from the VAT amount being refunded and
- AED 3.60 per refund claim (which is reduced from the previous fixed fee).
As a result, the eligible tourists will get the refund slightly higher than before.
Who Can Claim a VAT Refund in the UAE?
To qualify for the VAT refund, the person must generally be an Overseas Tourist under UAE VAT legislation.
The tourist must:
- Be physically present in the UAE at the time of purchase of goods.
- Purchase goods from a retailer who is participating in the UAE Tourist VAT Refund Scheme.
- Export the goods from the UAE within the prescribed time frame.
- Satisfy all eligibility conditions specified by FTA.
The scheme applies only to physical purchases made in stores, and following the earlier amendments, certain purchases made through electronic platforms are also eligible, provided the tourist personally receives the goods here in the UAE.
How Does the UAE Tourist VAT Refund Process Work?
Step 1: Shop from a Participating Retailer
Choose retailers who are participating in the Tourist VAT Refund Scheme of UAE.
While making the purchase, request a VAT refund transaction.
The retailer will verify your eligibility and create a refund record.
Step 2: Provide Required Information
The retailer should record:
- Passport details of the customer
- Details of the purchase made
- Other information mentioned by FTA and the scheme operator
After this recording, the retailer will issue the refund documentation electronically.
Step 3: Export of Goods
In the case of export, the purchased goods must physically leave the UAE within 90 days from the date of supply.
The goods should accompany the tourist while leaving the country.
Step 4: Verification at Departure
Before leaving UAE, the operator verifies:
· The eligibility of travellers
· The goods being exported
· The refund request
Once verified, the VAT refund will be processed after deducting the applicable administrative fees.
Can Online Purchases Qualify?
Yes.
In pursuance of the amendments introduced in 2024, purchases made through electronic platforms will also qualify for refund if:
- The tourist requests a VAT refund while purchasing for their personal account.
- The tourist receives the goods personally here in the UAE
- All other conditions are also satisfied.
This reflects the increasing role of e-commerce retailers in the UAE.
Minimum Purchase Value
This scheme does not apply to every purchase.
To claim a refund:
· The tax-inclusive value of purchases from the same retailer should be AED 250 or more.
If the purchase value is below AED 250, VAT refund cannot be claimed for that retailer's transaction.
Cash Refund Limit
The decision also limits cash refunds.
The maximum cash VAT refund available is:
AED 35,000 per overseas tourist in every 24 hours.
Tourists who are expecting higher refunds should check the payment methods offered by the scheme operator.
Goods That Are Not Eligible for VAT Refund
There are certain goods which are specifically excluded from the scheme.
These include:
Goods Not Accompanying the Tourist
Goods shipped separately after departure of tourist generally do not qualify under the scheme.
Goods Consumed in UAE
Those items that have been fully or partially consumed inside UAE cannot be refunded.
Motor Vehicles
Cars are specifically excluded from the Tourist VAT Refund Scheme.
Boats
Marine vessels do not qualify for refund scheme.
Aircraft
Aircraft purchases are also excluded.
Retailer Responsibilities
Participating retailers plays a major role in the scheme.
They must:
· Verify that the customer qualifies as an overseas tourist.
· Ensure that the purchases fall within the stipulated time period.
· Record the information of both customer and purchase.
· Issue the required refund documentation.
· Follow FTA requirements on packaging or delivery where applicable.
· Comply with all obligations agreed with the scheme operator.
Retailers should also note that VAT refund forms cannot be issued to customers under the age of 18.
Practical Tips for Tourists
If you are planning to claim for the VAT refund:
✔ Shop only from participating retailers.
✔ Keep your passport with you while making the purchases.
✔ Maintain all purchase documents.
✔ Do not consume eligible goods before leaving UAE.
✔ Carry the goods with you while departing.
✔ Arrive early at the airport to complete verification procedures.
Why This Matters for UAE Retailers
The Tourist VAT Refund Scheme promotes international shopping and supports sectors such as:
· Retailers of luxury products
· Dealers in Jewellery
· Fashion
· Electronics
· Watches
· Souvenirs
Keep updated with the rules helps retailers to improve their customer experience while maintaining compliance with VAT.
Frequently Asked Questions (FAQs)
1. Who is eligible for UAE Tourist VAT Refund Scheme?
International tourists who purchases goods from participating retailers and export the goods outside UAE within the prescribed time period can claim for VAT refund, subject to satisfy the conditions.
2. What is the minimum purchase amount required to claim a VAT refund?
The purchase value which is inclusive of VAT from the same participating retailer must be AED 250 or more.
3. What changed under FTA Decision No. 11 of 2026?
Under this decision the fixed administrative fee per refund claim reduced to AED 3.60, allowing eligible tourists to receive a slightly higher refund.
4. Can I claim a VAT refund on online purchases?
Yes. Some online purchases also qualify for the refund if is requested during the time of purchase, and the tourist must personally receives the goods here in UAE, and all eligibility conditions are met.
5. Which goods are excluded from the Tourist VAT Refund Scheme?
Goods that are consumed in the UAE, goods not accompanied by the tourist on departure, motor vehicles, boats and aircraft are excluded from the scheme.
Conclusion
The UAE Tourist VAT Refund Scheme makes shopping in the Emirates attractive for international visitors. With the latest amendment under FTA Decision No. 11 of 2026, tourists will get the benefit like lower fixed administrative fee, while retailers must continue following the prescribed procedures by FTA to ensure smooth processing of refund.
Whether you are a retailer participating in the scheme or a tourist planning for shopping, understanding the updated rules can help you to maximise benefits and avoid unnecessary issues at the point of departure.
How Flying Colour Tax Consultant Can Help
At Flying Colour Tax Consultant, we help retailers across UAE to stay compliant with VAT regulations by assisting on services like:
· Registration and deregistration of VAT
· VAT health checks
· Preparation and filing of VAT returns
· Assistance in VAT audit
· VAT advisory for retailers
· Assistance with FTA compliance and preparation of tax records
Our experienced tax professionals ensure your business remains compliant with the regulations while delivering a seamless experience to international customers.
To learn more about UAE Tourist VAT Refund Scheme Updated in 2026, book a free consultation with one of the Flyingcolour team advisors.
Disclaimer: The information provided in this blog is based on our understanding of current tax laws and regulations. It is intended for general informational purposes only and does not constitute professional tax advice, consultation, or representation. The author and publisher are not responsible for any errors or omissions, or for any actions taken based on the information contained in this blog.