FTA Expands VAT Refunds for UAE Nationals Building New Homes

UAE, 02 July, 2026: The Federal Tax Authority (FTA) has expanded the list of construction expenses eligible for VAT refunds for UAE nationals building new residences. The initiative applies to all eligible refund claims submitted on or after 1 January 2026.

The enhanced scheme is expected to generate around AED 200 million in additional VAT savings, with an average refund of approximately AED 25,000 per claim. Total approved refund claims are projected to exceed AED 1 billion in 2026.

Newly eligible items include:

• Staff accommodation (watchmen, drivers, and domestic workers)
• Home gyms and game rooms
• Integrated security and smart home systems
• Smart main and garage doors
• Swimming pools, fountains, and decorative water features
• Landscaping
• Complete home reconstruction, including demolition and rebuilding costs

To qualify, these features must form an integral part of the residence, be built on the same plot of land, and be intended for the private use of the homeowner and their immediate family.

The FTA will also conduct awareness sessions at district councils across the UAE to educate citizens about the expanded refund scheme and its application process.