How to calculate Municipality fee, Service charge, and VAT for restaurants in Dubai

Restaurants in Dubai charge Municipality fee, Service charge, and VAT.
Let's say all Prices are inclusive/exclusive of 10% service charge, 7% Municipality fee and 5% VAT.
How can I calculate this? Also, how are each fee calculated?

Best Answer

First receipt has these charges listed out explicitly, on other receipts the prices are already inclusive (although the VAT amount is explicitly shown).

So for example, the last receipt shows AED1531.00 charge which is inclusive of all the taxes. It then lists the taxes: 5% VAT, 7% Mun. fee, 10% service. Total 22%. So 1531.00 is 122% of the original amount. Your total before taxes thus is 1254.92 (1531 / 1.22). You can then calculate each of the taxes from that amount. It may not add up perfectly because of the rounding errors.

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What is Dubai Municipality fee for a restaurant?

Beginning today (March 18), restaurants, hotels and hotel apartments will now see municipality fees slashed from 7 percent to 3.5 percent.

What is service charge in Dubai restaurants?

While most restaurants will note at the bottom of the menu that taxes and service charge have already been included in the bill, it's still common for diners in Dubai to tip the service staff. A figure between 10% and 15% is customary, but this is dependent on the quality of service.

What is municipality fee for hotels?

Hotel establishments shall pay monthly municipality fees for their sales and the fees represent (10%) of the total monthly revenues of hotel rooms or apartments, food and beverage and other services provided to their guests and visitors.

What is municipality tax Dubai?

The municipality tax is calculated as 5% of your rental contract's value for all premises, with a minimum amount to pay of AED 450 per annum. Although the total fee applies from the first day of the rental contract, the annual fees are broken down into monthly installment to make payments easier.

VAT and Service Charges

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