VAT Deregistration in UAE
If your business no longer meets the VAT registration threshold or has ceased its operations, it is mandatory to apply for VAT deregistration in the UAE. Many businesses mistakenly assume that they can simply stop filing VAT returns; however, this is not the case. At Tax Consultants in Dubai, we provide professional guidance to ensure that your VAT deregistration application is filed accurately and in full compliance with FTA requirements, helping you avoid unnecessary penalties or compliance breaches.
When Is VAT Deregistration Required?
Under the UAE VAT Law, a business must apply for VAT deregistration when:
- The business is no longer making taxable supplies.
- The taxable supplies in the previous 12 months are below AED 375,000, the compulsory registration threshold.
- The business is no longer in business or in liquidation.
- A business that was voluntarily registered for VAT but taxable turnover is now below AED 187,500.
Businesses that are no longer eligible for these situations must submit a request for VAT deregistration in the UAE within 20 business days of becoming ineligible. They can be penalized otherwise.
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FTA Penalties for Late VAT Deregistration
Some of the conditions required for a firm to voluntary demerge from VAT may include :
The FTA will impose an administrative penalty of AED 1,000 for a first delay and AED 2,000 for every subsequent delay within 24 months if you fail to apply for VAT deregistration on time.
Additionally, the FTA can continue to request VAT return filing until deregistration is complete, and you can be fined for late VAT returns, as well.
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Requirements for VAT Deregistration in the UAE
For UAE VAT deregistration, the company needs to meet requirements and furnish appropriate documentation, including:
- Valid Trade License
- VAT Registration Certificate
- Latest VAT return filings
- Proof of business closure or reduced turnover
- Accounts evidencing entitlement to deregister
The application is submitted online through the FTA portal. The FTA will handle applications, verify your details, and, if approved, send a VAT Deregistration Certificate to confirm your registration is cancelled.
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Step-by-Step VAT Deregistration Process
Our tax advisors walk you through the process step by step:
- Eligibility Review – We check whether your business is eligible for VAT deregistration in UAE.
- Document Preparation – We gather and validate all necessary documents and supporting documents.
- FTA Application Submission – We submit the deregistration application via the corresponding FTA portal.
- Final VAT Return Filing – We prepare and file your last VAT return before deregistration.
- Confirmation & Certificate Issuance – We follow up on the FTA until your deregistration certificate is approved and issued.
This ensures a smooth transition without fines or delays.
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Importance of Professional Assistance
VAT deregistration process requires careful financial assessment, detailed reconciliations, and compliance with Federal Tax Authority (FTA) regulations. Any inaccuracies in the final VAT return or failure to settle outstanding tax liabilities can lead to the rejection of your deregistration application or even trigger an FTA audit.
Engaging a professional VAT deregistration consultant ensures that the entire process is handled accurately and efficiently. With expert support, you can be assured of:
- Proper closure and reconciliation of all VAT accounts.
- Clearance of any outstanding VAT liabilities or late filing penalties.
- Seamless communication and coordination with the FTA.
- Comprehensive documentation and secure record retention in full compliance with UAE tax laws.
Contact us today, and we shall be glad to assist you.
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