Chart of Accounts for UAE Businesses: Sample and Setup

A chart of accounts is the numbered list of every account your business records transactions in, grouped into assets, liabilities, equity, revenue and expenses. For a UAE business, a good chart of accounts also separates output VAT, input VAT and reverse charge VAT, provides for end-of-service gratuity, and splits revenue so you can report standard-rated sales by emirate, zero-rated sales and exempt sales on your VAT return. The sample below is a starting point for a trading or services SME.

How we wrote this guide. The account structure follows common accounting practice. The UAE rules come from the Federal Tax Authority (FTA): its VAT return guide, the VAT Executive Regulation and its corporate tax guide on accounting standards, all listed under Sources. Ask your accountant or auditor to review your final chart. Facts last verified: 3 November 2026.

What a Chart of Accounts Is

Every transaction you record lands in at least two accounts: a sale increases a receivable and revenue, and a supplier payment reduces cash and a payable. The chart of accounts is the list of those accounts, each with a number and a name. Your trial balance, profit and loss account and balance sheet are all built from it.

The UAE doesn't set a standard list of account codes for private businesses. What matters is that the chart produces financial statements under the accounting standards you follow, and the figures your VAT and corporate tax returns need.

The Five Main Account Types

Assets: what the business owns or is owed, such as cash, receivables, stock and equipment.
Liabilities: what it owes, such as supplier balances, VAT payable, loans and staff provisions.
Equity: the owners' stake, such as share capital and retained earnings.
Revenue: income from sales and services.
Expenses: the costs of running the business, including cost of sales.

Assets, liabilities and equity make up the balance sheet. Revenue and expenses make up the profit and loss account.

How to Number Your Accounts

Most SMEs use four-digit codes, with the first digit showing the type:

1000 to 1999: assets
2000 to 2999: liabilities
3000 to 3999: equity
4000 to 4999: revenue
5000 to 5999: cost of sales
6000 to 6999: operating expenses
7000 to 7999: other income and expenses, such as exchange differences, interest and tax

Leave gaps of 10 between accounts, so you can add one later without renumbering. Keep the same number for the same account across every company in your group.

A Sample Chart of Accounts for a UAE SME

Assets (1000 to 1999)

1010 Cash on hand
1020 Petty cash
1100 Bank, AED current account
1110 Bank, USD account
1200 Accounts receivable
1210 Allowance for doubtful debts (expected credit losses)
1300 Inventory
1310 Goods in transit
1400 Prepayments, such as rent, insurance and trade licence fees
1410 Security deposits
1420 Advances to suppliers
1500 Input VAT recoverable
1510 Input VAT, reverse charge
1600 Intercompany receivable
1710 Furniture and fittings
1720 IT equipment
1730 Motor vehicles
1740 Leasehold improvements
1790 Accumulated depreciation
1800 Right-of-use assets, if you report leases under full IFRS

Liabilities (2000 to 2999)

2010 Accounts payable
2020 Accrued expenses
2030 Goods received not invoiced
2100 Output VAT payable
2110 Output VAT, reverse charge
2120 VAT control, the net amount due to or from the FTA
2200 Salaries payable
2210 Leave salary accrual
2220 End-of-service gratuity provision
2300 Customer advances and deferred revenue
2400 Corporate tax payable
2500 Lease liabilities
2600 Bank loans
2700 Intercompany payable
2800 Due to shareholders

Equity (3000 to 3999)

3010 Share capital
3020 Statutory reserve, if your company's legal form requires one
3030 Retained earnings
3040 Current year profit

Revenue (4000 to 4999)

4010 Sales of goods, standard-rated
4020 Sales of services, standard-rated
4030 Zero-rated sales, such as exports
4040 Exempt sales
4050 Sales returns and discounts

Cost of Sales (5000 to 5999)

5010 Cost of goods sold
5020 Freight, customs duty and clearing charges on purchases
5030 Stock adjustments and write-downs

Operating Expenses (6000 to 6999)

6010 Salaries and wages
6020 End-of-service gratuity expense
6030 Visa, Emirates ID and labour fees
6040 Staff medical insurance
6100 Rent
6110 Electricity and water
6120 Telephone and internet
6200 Trade licence and government fees
6300 Marketing and advertising
6310 Client entertainment
6400 Motor vehicle expenses
6500 Audit, legal and tax fees
6600 Bank charges
6700 Depreciation
6800 Software subscriptions
6900 Non-recoverable VAT

Other Income and Expenses (7000 to 7999)

7010 Foreign exchange gains and losses
7020 Interest expense
7030 Corporate tax expense

That's 66 accounts, which is enough for most SMEs. Add accounts when a figure needs its own line in your reports, not for every customer, supplier or project.

Setting Up Accounts for UAE VAT

Keep output VAT and input VAT apart. Separate accounts let you reconcile each one to the VAT return before you file.
Record reverse charge VAT in its own pair of accounts. On imported goods and services under the reverse charge, you account for VAT as both output and input VAT, and separate accounts make that easy to check.
Split standard-rated sales by emirate. The VAT return reports standard-rated supplies by emirate, usually based on the establishment most closely connected to the supply. If you operate from more than one emirate, tag sales by branch or use separate revenue accounts, so you don't have to rebuild the split every quarter.
Keep zero-rated and exempt sales in their own accounts, because the return reports them separately.
Send blocked VAT to expense. Input VAT you can't recover, such as on client entertainment or cars available for personal use, isn't an asset. Post it to the expense or to a non-recoverable VAT account.

Our guide to calculating UAE VAT covers payable VAT and the blocked categories.

Accounting Standards in the UAE

For corporate tax purposes, Ministerial Decision No. 114 of 2023 sets the standards for financial statements:

IFRS is the default.
IFRS for SMEs can be used by businesses with revenue of AED 50 million or less.
The cash basis is allowed for businesses with revenue of AED 3 million or less.

The FTA's guide also says businesses with revenue above AED 50 million, and all qualifying free zone persons whatever their revenue, must prepare and keep audited financial statements.

The standard you follow shapes a few accounts. Leases are the clearest example: under full IFRS most leases go on the balance sheet as a right-of-use asset and a lease liability, so the sample includes both. Check the details with your auditor.

How to Set Up Your Chart of Accounts

Start from your reports. List the lines your profit and loss account, balance sheet and VAT return need, then create accounts that produce them.
Choose your numbering and leave gaps.
Add the UAE accounts: VAT, reverse charge, gratuity, leave accrual, trade licence and visa costs.
Use sub-ledgers for customers and suppliers, not one account each. The receivables and payables accounts hold the totals.
Use tags or branches for locations and projects, instead of copying the same expense account for each one.
Use one chart for the whole group, so a mainland company and a free-zone company report the same way and consolidate cleanly.
Document every account with a short description of what goes in it, and control who can add or change accounts.

If you're moving from Tally, its ledger groups map onto these ranges. See our guide to moving from Tally to cloud ERP in the UAE.

Common Mistakes

Too many accounts, such as one per customer or per project, which makes reports long and hard to read.
One VAT account for everything, which makes the VAT return hard to reconcile.
No gratuity provision, so the end-of-service cost appears all at once when someone leaves.
Renumbering mid-year, which breaks comparisons with last year.
Different charts in each company, which turns consolidation into a spreadsheet exercise.

Where Octate Fits

Octate is cloud ERP with a general ledger, receivables, payables, multi-currency accounting and financial reports, including trial balances and budget-vs-actual reports, under GAAP or IFRS. Business+ covers up to 5 companies under one login, with separate or consolidated reports. Octate applies VAT to every sale, purchase and expense and gives you the figures for your VAT return. When you start, an implementation manager migrates your data from Excel, QuickBooks, Zoho, Odoo, Sage 50 or Tally. See accounting and finance.

Quick Answers

What is a chart of accounts? The numbered list of all the accounts a business records transactions in, grouped into assets, liabilities, equity, revenue and expenses.

What are the five main types of accounts? Assets, liabilities, equity, revenue and expenses.

How do you number a chart of accounts? Most SMEs use four-digit codes: 1000s for assets, 2000s for liabilities, 3000s for equity, 4000s for revenue, and 5000s and up for costs and expenses, with gaps of 10 between accounts.

Is there a standard chart of accounts in the UAE? No standard list of account codes is set for private businesses. Your chart needs to produce financial statements under your accounting standard and the figures for your VAT and corporate tax returns.

How many accounts should an SME have? Usually between 50 and 100. Add accounts only when a figure needs its own line in your reports.

Which accounts does UAE VAT need? At least output VAT, input VAT, reverse charge VAT and a VAT control account, plus revenue accounts that separate standard-rated, zero-rated and exempt sales.

Should each customer have its own account? No. Use a receivables sub-ledger for customers and a payables sub-ledger for suppliers, with one control account for each.

Do UAE businesses have to use IFRS? For corporate tax, IFRS is the default. Businesses with revenue of AED 50 million or less can use IFRS for SMEs, and those with AED 3 million or less can use the cash basis.

Sources

Ministry of Finance: Ministerial Decision No. 114 of 2023 on the accounting standards and methods for corporate tax purposes
Federal Tax Authority: Accounting Standards and Interaction with Corporate Tax guide, the VAT Returns User Guide and the VAT Executive Regulation, as amended to Cabinet Decision No. 149 of 2026, Article 53
Octate: accounting and finance

Checked on 3 November 2026.