GTL Summary:

Article 39 of the VAT Executive Regulations specifies the conditions for applying a zero rate of VAT to the first supply of a converted residential building, implementing Federal Decree-Law No. 8 of 2017. For the zero rate to apply, the supply must occur within three years of the conversion's completion. A key condition mandates that the original building had not been used as a residential building for at least five years before the conversion commenced. The Article further clarifies that the presence of shared facilities does not, by itself, disqualify the property from these provisions.

Document Type: ERS - Executive Regulations
Law: VAT (FDL No 8 of 2017, as amended)
Decision Number: 52-article-39
Year: 2017
Country: 🇦🇪 UAE
Official Name: Article 39 - Applying the Zero Rate to Converted Residential Buildings
Last updated at: 2025-12-26 14:13:51 UTC

Part 6 - Zero-Rated Supplies

Article 39 - Applying the Zero Rate to Converted Residential Buildings

  1. The first supply of a building, or any part thereof, which is converted to a residential building shall be zero-rated, provided that the supply takes place within three (3) years as of the completion of the conversion and the original building, or any part thereof, has not been used as a residential building and not comprised part of a residential building within (5) five years prior to the commencement of the conversion work.

  2. The presence of shared or common facilities, or dividing walls or similar features in a residential building shall not be sufficient grounds to consider the residential building or any part thereof as part of an existing residential building.

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