English text status

English translation published by the Legislation and Legal Opinion Commission. The Arabic text published in the Official Gazette remains the legal reference in the event of any discrepancy.

Practical summary

The value of a Supply is the Consideration excluding VAT, including supplier-charged expenses, fees and other taxes such as Excise Tax. Special rules cover non-cash Consideration, reverse charge and shared Consideration.

Who should read this?

Pricing, sales, accounting, contracting and procurement teams.

Why does it matter?

The VAT base is not always the written cash price alone. It may include charges, fees, Excise Tax and Market Value for non-cash Consideration.

Consideration excluding VATNon-cash ConsiderationFees and expenses

Current text

The value of a Supply shall be calculated based on the Consideration, excluding Tax, including all expenses imposed by the taxable Supplier on the Customer as well as the fees due as a result of the Supply and all taxes due, including excise tax, but excluding Tax. If all or part of the Consideration is non-monetary, the value of the Supply is calculated on the basis of the total of the cash portion and the fair Market Value of the non-monetary portion of the Consideration, inclusive of all the expenses referred to in the previous paragraph of this Article, excluding Tax. For Tax due in accordance with the Reverse Charge Mechanism, the value of the Supply is the purchase price. In the event that the purchase price cannot be determined, the value of the Supply is the fair Market Value at the date of receipt of such Supply. If the Consideration relates to other matters in addition to the Supply of Goods or Services, the value of the Supply shall be equal to that part of the Consideration relating to the Supply. The Regulations shall specify the provisions and the rules governing the implementation of the provisions of this Article, in addition to identifying rulesand conditions for determining Market Value.

Build the value of Supply

  1. 1

    Start with Consideration before VAT.

  2. 2

    Add supplier-charged expenses, fees and other taxes linked to the Supply.

  3. 3

    Value non-cash Consideration at fair Market Value.

  4. 4

    Allocate shared Consideration to the relevant Supply and retain the allocation basis.

Connected provisions

Direct legislative link

Regulations — Article (24)

Value of Goods and Services

It explains refundable security deposits and how fair Market Value is determined.

Open connected Article
Direct legislative link

Regulations — Article (25)

Special valuation cases

It covers price allocation across differently treated components, collateral and initially uncertain values.

Open connected Article

Official guides and tools

Official guide

VAT General Guide

Value of Supply and Consideration

Illustrative example by Madar

Price plus delivery charge and Excise Tax

Where a supplier charges the item price and delivery and the item bears Excise Tax, the elements named by the Article form part of the VAT base. VAT itself is excluded from that base.

Questions to help you apply it

  • Which amounts does the supplier charge because of the Supply?
  • Is there non-cash Consideration requiring Market Value?
  • Is shared Consideration allocated across different matters?