In October 2024, the United Arab Emirates (UAE) abolished value-added taxes (VAT) on transfers and conversions of cryptocurrencies, and taxes are abolished starting from January 1, 2018. That is, UAE companies are exempt from taxes on transactions with cryptocurrencies, and if taxes have already been paid earlier, they can expect to be reimbursed for all taxes starting in 2018. In order to count on such generosity from the Government of the United Arab Emirates, companies need to register with the Dubai Virtual Asset Regulatory Authority (VARA) and the Securities and Exchange Administration (SCA) and have a license for a virtual asset service provider (VASP).
More information on the regulation of the cryptocurrency business in the UAE can be found on the website Kychub.com
It is worth noting that ordinary citizens in special economic zones such as Dubai were exempted from paying income tax on the sale of cryptocurrencies back in 2021. But at the same time, it is still necessary to file a tax return indicating the profit received from trading cryptocurrencies.
Outside of special zones, the tax on transactions with cryptocurrencies in the UAE is 5%.
The country's legislation also provides for the possibility of opening bank accounts for non-residents with many restrictions, i.e. for residents of other countries.
In order to be within the law and not pay taxes on cryptocurrency transactions, you, as a resident of this country, need to use only crypto exchanges licensed in the UAE.
Crypto Exchanges licensed by VASP UAE
Bybit is the most dynamically developing crypto exchange in the world, is in the TOP 2 in terms of trading volume, received a license in the UAE to work with virtual assets in August 2024
Binance is the number 1 cryptocurrency exchange in the world in terms of trading volumes and number of users. It has been licensed by the UAE VASP since April 2024.
OKX is one of the oldest cryptocurrency exchanges in the world, confidently occupies the 4th place in the rating. It has been licensed by the UAE since September 2024.
There are 22 companies in the list that have a license to work with cryptocurrencies in the United Arab Emirates.
You can get acquainted with this list yourself at this link
To date, all major cryptocurrency exchanges are already officially operating in the United Arab Emirates, so you most likely will not need to change your usual cryptocurrency exchange when moving to the UAE, you will only need to provide documents to change your place of residence.
Due to the lack of taxes on working with cryptocurrencies, many crypto traders, the founders of crypto startups now live in the UAE. And most likely this trend will only grow.
To summarize, the United Arab Emirates is trying to occupy the niche of the most friendly country for business related to cryptocurrencies, and as much as possible become a financial hub between various global financial markets, which are just being formed at this moment when the US dollar continues to lose its position as the main currency for international settlements.
Other competing players for the global cryptocurrency hub are Hong Kong and El Salvador, which have also recently been making many steps to attract cryptocurrency businesses.
