Expanding the scope of eligible expenses is expected to yield an estimated AED200 million in VAT savings for UAE nationals, averaging approximately AED25,000 per claim. This highlights the initiative’s role in supporting home ownership and alleviating the financial burden on families.

The initiative is expected to deliver tangible financial benefits for UAE nationals building new homes. Based on projected 2026 demand volume, the total value of approved refund claims is expected to exceed AED1 billion, compared with approximately AED754 million in 2025.

FTA announced that efforts in the coming period will focus on raising awareness among UAE citizens of the initiative's benefits and how to utilise them.

Over the coming period, the FTA will host discussion sessions with citizens across the UAE at local district councils to introduce the new initiative and the FTA's citizen-focused services, and to gather public feedback, observations, and suggestions to drive further development and meet expectations.

FTA stated that the initiative, now active, applies to all VAT refund claims for Emirati home construction submitted on or after 1st January 2026, coinciding with the Year of Family, provided all criteria are met. It also stated that the digital VAT refund platform has been updated to list the categories of eligible expenses approved by the initiative.

Abdulaziz Al Mulla, Director-General of the FTA, said, “FTA’s latest tax relief for UAE nationals aligns with the UAE leadership’s vision to provide comprehensive support to citizens and deliver premium services that ensure their happiness. The initiative reflects integrated national efforts to foster social stability and wellbeing.”

Al Mulla added, “Coinciding with the Year of Family, this new initiative ensures the wellbeing of our citizens by establishing clear, transparent mechanisms to facilitate VAT refunds for new home construction.”

Abdulaziz Al Mulla explained that under the new initiative, UAE citizens are permitted to claim VAT refunds on specific expenditures related to the construction of their new residences. This applies to items that form part of the residence, including its fixtures and fittings, provided they are intended for the private use of the citizen or their immediate family. The refunds remain subject to meeting all conditions, procedures, and supporting documentation requirements.

He noted that the additional eligible items covered by the initiative include staff quarters for watchmen, drivers, or domestic workers; home gyms and game rooms; and integrated security and smart home systems, including their built-in components. It also covers electronic or smart doors for the main residence and garage, swimming pools, fountains, decorative indoor water features, landscaping, and complete home reconstruction projects, including demolition and rebuilding costs.

To qualify for a refund, these features must be integral to the new residential property, be constructed on the same plot of land, and directly serve the primary residence.