Businesses must deregister from the VAT system, in instances where they cease conducting business activities related to VAT supplies. In the UAE, the Federal Tax Authority (FTA) administers this process. Thus, to effectively cancel Value Added Tax Registration in compliance with statutory regulations, businesses should seek the expert services of top Tax Consultants in UAE.
Eligibility Criteria to Cancel VAT Registration
The following conditions allow Taxable Persons to cancel VAT Registration in the UAE:
- No Taxable Supplies: If your company no longer produces taxable supplies and has no strategies to do so in the upcoming 12 months.
- Value Below Voluntary Registration Threshold: If our company continues to produce taxable supplies, but the sum of taxable supplies over the past 12 months is less than the AED 187,500, which is the voluntary registration threshold.
- Value Below Mandatory Registration Threshold: If our company continues to produce taxable supplies, but the sum of taxable supplies over the past 12 months is less than the AED 375,000, which is the mandatory registration threshold.
- the mandatory registration threshold, and is above the voluntary registration threshold.
Step-by-Step Guide to Cancel VAT Registration in UAE
Through the EmaraTax portal, the UAE government has simplified the process of cancelling VAT registration for UAE businesses. Here is a step-by-step instruction manual to assist you with the online VAT deregistration procedure:
Step 1: Access Your EmaraTax Account
- Make use of UAE PASS or your login information to access your EmaraTax account.
- By selecting the "Sign up" option, new users can register for VAT.
- You can access the EmaraTax online user dashboard after logging in.
- Enter the OTP obtained in your registered email and mobile number to log in if you have activated two-factor authentication.
Step 2: Select Your Company in the EmaraTax Dashboard
- When you open the EmaraTax dashboard, a list of Taxable Persons connected to your profile will be visible.
- To access the dashboard, choose the Taxable Person linked with your company and click "View." You must make a new Taxable Person if your company isn't listed.
Step 3: Initiate Application to Cancel VAT Registration
- On the VAT icon within the dashboard, click 'Actions'.
- To begin the application process for cancelling VAT Registration, choose "Deregister."
Step 4: Edit and Update Information
- To change your bank information, click 'Edit/Review' if necessary.
- To access the VAT deregistration application, click 'Proceed to De-Registration'.
- Make sure you have all the necessary documentation prepared for submission.
- To start the process of cancelling VAT Registration, click 'Start'.
Step 5: Submit Required Information and Documents
- Fill out the application form completely, and upload any supporting materials in the appropriate formats.
- To avoid application rejections or further re-submissions, make sure to fill out all of the fields.
- The deregistration application may automatically fill in some of your VAT registration information.
- Fill out the required information and documents in accordance with the reasons you have chosen for your deregistration.
Step 6: Specify the Eligible Date
- Depending on the chosen criteria, specify the date after which your company will be eligible for deregistration.
- EmaraTax will automatically create the date of deregistration, however, if you have an important reason, you can request an alternative date.
Step 7: Fill and upload the Excel
- To support your claim, provide evidence of your taxable supplies and expenses.
- Only enter numbers in UAE Dirhams (AED).
- By selecting "Next Step," you can save and go on to the "Authorized Signatory" section.
Step 8: Verify Authorized Signatory
- Check the authorized signatory's information.
- Review and double-check the information using the "Previous" and "Next" buttons before moving on to the following section.
Step 9: Review & Declaration
- To verify its accuracy, go through every detail you entered in the application.
- Click "Submit" to send the application to cancel VAT registration.
Also read more: VAT Late Payment Penalties in the UAE: FAQs
Post-VAT Deregistration Process in the UAE
A reference number is generated for your documents after you apply; keep it accessible for any upcoming interactions with the FTA. The post-deregistration process involves the following:
- FTA Review: After reviewing your application to cancel VAT registration, the FTA may ask for more supporting documentation.
- Application Status: Check the status of the application in your dashboard. When the FTA confirms that your de-registration has been approved, you will be informed.
- Final Tax Return: Submit an Emara Tax-generated final tax return.
- Payment of Liabilities: Based on the balance of your account, pay any unpaid tax as per the VAT regulations. Cancellation of VAT registration may be postponed or prevented if unpaid charges are not addressed.
- Credit Amount: Finish processing the refund using the portal if you have a credit balance with the FTA.
- Notification: Your application's status and any outstanding payments will be notified to you by email and SMS.
Seek the Expert Services of Top Tax Consultants in the UAE
To cancel VAT registration in the UAE, satisfying the eligibility requirements is required. It is essential to obtain all required documents and adhere to the instructions provided by the FTA. Thus, it is advisable for companies operating in the UAE to seek professional tax advice to ensure a smooth and compliant VAT deregistration process. Therefore, contact us today and we shall be glad to assist you.