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Dubai Tourism Taxes and Fees for Hotels & Airbnb

Aug. 3, 2023, 1:01 p.m.

As an ever-evolving cosmopolitan hub, Dubai has become a beacon for tourists worldwide. This vibrant emirate offers a wealth of opportunity for those seeking to invest in the holiday home business. However, to navigate this venture smoothly, it's essential to understand the different taxes and fees involved in the process. Ahmed, a new holiday home owner, is eager to learn the ropes and share his insights on taxes after his story on getting DTCM Permit and basic criteria for holiday homes.

Overview of Tourism Taxes in UAE

Accommodation businesses, including hotels, hotel apartments, resorts, restaurants, and holiday homes in the UAE, typically charge a variety of taxes and fees. The commonly imposed charges include:

  • 10% tax on the room rate
  • 10% service charge
  • 7% municipality fees
  • 6 to 10% city tax
  • Tourism Dirham fee
  • 5% VAT

These are designed to ensure that the booming tourism industry continues to be supported and can contribute effectively to the local economy.

The Tourism Dirham Fee

One specific tax of note is the 'Tourism Dirham Fee,' applied per room, per night of occupancy, capped at a maximum of 30 consecutive nights. In Dubai, this fee varies from AED 7 to 20, contingent on the category/grade of the hotel or holiday home. For instance, in Ras Al Khaimah, hotels impose a flat AED 15 tourism fee per room per night.

Tourism Dirham Fee Breakdown for Holiday Homes and Hotels

For holiday home owners like Ahmed, the Tourism Dirham fee per room, per night, is determined by the classification of the property:

  • Luxury Holiday Home: AED 15 per room per night.
  • Tourist Holiday Home: AED 10 per room per night.

Hotels have their specific charges, too:

  • Five-star hotels: AED 20
  • Four-star hotels: AED 15
  • Three-star hotels: AED 10
  • One-star/budget hotels: AED 7

In each case, this fee is collected when the guest checks in, and it must be shown as a separate line item on the bill.

Paying the Tourism Dirham Fee

The procedure for paying the Tourism Dirham Fee is crucial to keep in mind. If you provide inaccurate documents or incomplete information, or manipulate accounts in relation to the Tourism Dirham, you could face a fine of AED 15,000.

Payment methods include check deposit directly or bank transfer to the department bank account. You will need the following details:

  • Bank name: Emirates NBD (any branch)
  • Account name: DTCM-Tourism Dirham
  • (IBAN) No: AE450260001012049366501

Upon successful transfer, ensure to confirm the update of the e-tourism dirham system when a confirmation screen appears. Always include your company's commercial license number or Holiday Home Foundation when making necessary Tourism Dirham payments.

Remember, for long stays spanning more than 30 consecutive nights, the Tourism Dirham fee will only be charged for the initial 30 nights. As a licensee, you are required to enter the Tourism Dirham data by the 15th of each month.

Operating a holiday home or a hotel business in Dubai is an exciting venture. By being aware of the different taxes and fees, and understanding the importance of timely and accurate payment, you can navigate the process with confidence, just like Ahmed.