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VAT Deregistration in UAE

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Vat deregistration service in UAE

VAT de-registration, also referred to as the cancellation or termination of VAT registration, occurs when a business seeks to end its VAT registration with the UAE Federal Tax Authority (FTA). The FTA permits VAT de-registration only if the reasons for termination are valid and all legal requirements are satisfied. Businesses in the UAE can de-register from VAT if their sales after registering with the FTA does not surpass AED 187,00 within the first 12 months of registration or if the firm ceases to produce taxable supply.

UAE VAT AccountingReasons for Backlog

VAT accounting is the process of managing a company’s VAT department. According to UAE Tax Law, every taxable person must keep a book of records, which needs extensive documentation. Proper documentation helps to determine the consumption tax that must be paid on time. It lowers the tax burden. In the UAE, maintaining VAT records is obligatory. AL MERAK offers the best VAT consultation services in Dubai and the UAE, managing all of the necessary tasks associated with VAT accounting, such as VAT data, tax report review, tax computation and filing, VAT paperwork, and so on, in a smooth manner.

Deregister for VAT

VAT Deregistration in the UAE is done online using the FTA site. However, organizations that cease operations must get a corporate liquidation letter from the government before applying for VAT deregistration. Al MERAK gives smooth VAT deregistration services in Dubai and the UAE, allowing businesses to stop their VAT services.

The FTA has allowed that businesses can ask for VAT deregistration under certain situations.
VAT de-registration in the UAE allowed businesses to stop from paying taxes. When an application for VAT deregistration is submitted, FTA will review the application and withdraw the VAT number assigned to the firm if it has followed the law. If the grounds are not acceptable and the prerequisites are not met, the FTA may reject the application for deregistration.
The FTA said that the UAE Tax System is solely reliant on voluntary compliance by Taxable Persons, whether through registration, submitting Tax Returns, paying required tax, or de-registration.
As a result, a firm can request for voluntary or mandatory deregistration, as stated below: –

Voluntary Deregistration

Article 17 states that a Registrant cannot request for VAT Deregistration within 12 months of Tax Registration.

A firm can move forward with the voluntary deregistration procedure: –

• If it’s been 12 months after tax registration.

• If it no longer provides taxable commodities.

• If yearly turnover is less than AED 187,500, even after delivering taxable products.

• The expected value of taxable supplies or costs in the next 30 days must not exceed the voluntary registration level.

• If the firm closes permanently.

Mandatory Deregistration

A firm can move forward with the obligatory deregistration procedure: –

• If the firm no longer generates sales of AED 375,000.

• If the firm does not provide any taxable goods.

VAT Deregistration for Groups

The FTA will authorize the termination of VAT registration for the following groups: –

• If the registered business no longer fits the group criteria.

• If the group’s enterprises no longer have financial ties.

• Predicting a group’s tax status can lead to evasion.

Once the deregistration number is accepted, the authorities will revoke the VAT number granted during registration. If a firm wants to reregister, they may fill out the registration form again, and a new VAT number will be granted to them.

Registrants will not be deregistered if:

• Fails to submit application within 20 business days.

• The company has not paid all applicable taxes and administrative fines.

• It has not submitted all required tax returns for the registration period.

Failure to file the de-registration application within the term set in the tax legislation would result in the imposition of administrative fines of Dh 10,000, as indicated in Cabinet Resolution No. 40 of 2017 on Administrative fines for Violations of Tax Laws in the UAE.

• Meet all conditions to deregister for VAT in UAE.
• Log in to your VAT account on the FTA Portal.
• Fill out the VAT deregistration form with your data and explanation for the deregistration.
• Receive SMS confirmation via registered phone for submission.
• Submit the form electronically.

After a successful submission, the application status will be “Pre-Approved.” Only once you have cleared all of the obligations will it be marked as “Approved”. If you want to continue your business or are waiting for a new investor, it is not advised to proceed with the VAT cancellation process. If such a circumstance happens, maintain the TRN and submit the tax return as ZERO if the firm anticipates a positive return during the following twelve months.

How Al MERAK helps you in Deregistration Process?

Al MERAK delivers competent VAT Deregistration services in the UAE in accordance with Emirati VAT legislation. Al MERAK analyzes the A-Z causes and simplifies the deregistration procedure for you. Al MERAK starts from zero, reviewing your company operations and deregistration options to make the process easier.
We recognize the relevance and necessity for VAT services for every business entity in the UAE, and we provide a comprehensive range of VAT services in Dubai, including:

• Vat Training.

• VAT registration.

• VAT deregistration

• Ensuring VAT compliance and control

• File and pay VAT.

• Analyze the impact on company cash flow.

In addition to VAT deregistration services in Dubai, Al MERAK offers a variety of business services such as CFO services, auditing services, accounting and bookkeeping services, accounting software, and due diligence services.

If you have any questions concerning the UAE VAT De-registration procedure or your present business, please feel free to contact us. Al MERAK is available to help you!
Our specialist will provide you with a one-hour free consultation to eliminate your doubts!

Can I deregister my TRN after 6 months if it was voluntarily registered?

No, you must wait 12 consecutive months before applying for tax de-registration.

Can I deregister if my previous 12 months' turnover is less than the statutory threshold?

Yes, you can request for tax deregistration

How to cancel VAT registration in the UAE?

On the dashboard, select the option ‘De-Register’. The reason for de-registration and the date from which you wish to de-register must be entered. Other relevant information must also be given if required. FTA will notify you of the result of the application you submitted.

Can anyone de-register if I haven't had any sales in the previous 12 months and haven't filed my tax returns?

Yes, you may ask for deregistration. However, approval will be granted only when all applicable taxes and administrative penalties have been paid.

Can we remove/deregister a single firm from a tax group?

Yes. The representative member of the organization shall inform the authorities within 20 days after terminating the individual’s eligibility.

Are there any consequences for delayed de-registration?

Yes, there will be an AED 10,000 penalty if obligatory de-registration is not completed on time. De-registration applications should be received within 20 business days.

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