The UAE has implemented a major tax policy update that exempts cryptocurrency transfers and conversions from value-added tax (VAT). This policy, effective as of October 2, 2024, has been applied retroactively to cover transactions dating back to January 1, 2018. The exemption is part of the country’s broader strategy to foster a favorable business climate for crypto investments and solidify its position as a hub for digital assets.
In addition to the VAT exemption, UAE authorities are encouraging companies involved in virtual assets to reassess their tax obligations and reclaim any VAT paid on relevant transactions through input tax recovery mechanisms. These efforts are accompanied by tighter regulations governing virtual assets, particularly concerning marketing practices to ensure transparency in promoting cryptocurrency investments.
This VAT policy change highlights the UAE’s commitment to supporting the growing crypto industry while maintaining regulatory oversight to protect investors and ensure compliance with financial standards.
