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Costs and Tax
Dubai property costs, fees and tax
Buying in Dubai costs a flat 4% Dubai Land Department fee plus registration and admin of roughly £200 to £1,000. Dubai charges no income tax on rent, no capital gains tax and no annual property tax. If you are tax resident elsewhere, Dubai rent and gains may still be taxable there.
Costs in Dubai are simple, and usually lower than in most Western markets once purchase taxes and legal fees are counted. Here is what I tell every investor to budget for, before we look at a single floor plan.
When you buy
| Cost | Amount |
|---|---|
| Dubai Land Department fee | 4% of the price |
| Registration and admin | £200 to £1,000 (AED 1,000 to 5,000) |
| My fee | None |
| Agency fee, resale only | 2% plus VAT |
| Trustee office, resale only | About £800 (AED 4,000) |
There is one flat purchase fee and no surcharge for owning more than one property.
While you own
| Cost | Amount |
|---|---|
| Service charge, per sq ft a year | £2 to £5 (AED 10 to 25) |
| Long term management | 5 to 8% of rent |
| Short let management | 15 to 25% of income |
| Maintenance | Low when new |
| Utilities on long lets | Paid by the tenant |
Gross is not net
Every yield advertised in Dubai is gross unless it says otherwise. Net is what is left after service charges, management and empty periods, and usually runs 1.5 to 2.5 points lower. As an example, a £200,000 one bed let at £14,000 a year is 7.0% gross and around 5.25% net before any tax at home.
Tax at home can still apply
Dubai charges no tax on rent or gains. If you are tax resident in a country that taxes worldwide income, such as India, the UK or the US, though, Dubai rent and gains are reported there. I can introduce specialists who cover both countries.
When you sell
There is no exit tax in Dubai. A seller pays the agent's fee and a developer no objection certificate. The buyer pays the 4% fee.
How I can help
Send me your budget and what you want to achieve and I will come back with two or three featured projects that fit, each with a 5 year illustration of equity and rental income. You can see the kind of property I recommend in the featured projects, read the full picture in my free 26 page guide, send me your brief, or book a call with me.
Talk to me directly
Prefer to talk it through? Book a call with me.
Pick a time that suits you. We will go through your budget, your goals and what is available now. No cost and no obligation.
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