Dubai: If you are a stock market or a bond trader, or invest through a fund, then get ready to pay a 5 per cent value-added tax (VAT) from January 1 on fees charged by brokerages or management fees charged by a mutual fund firm.
But it won’t be much. For example, for a Dh100 fee charged by the stock broker, the client will have to pay Dh5 only.
The Dubai Financial Market (DFM) in a post on its website said they will charge VAT, which will be added to the invoice value.
“Please note that this letter supersedes any contrary terms related to VAT in any agreement entered into with DFM, or in relation to the services provided by the DFM,” the bourse said in a note.
The same goes for traders who trade on the Abu Dhabi Securities Exchange (ADX). The Dubai Gold and Commodities Exchange will also charge VAT on transaction charges. And even forex trading will attract a 5 per cent value added tax.
Similarly, for remittances, a fee charged by the money exchange house will be taxed 5 per cent. The impact will be minuscule on remittances, and it can be anywhere between 50 fils and Dh2, depending on the location where the client wants to remit.
