In a recent issuance, the FTA announced that companies can opt for deregistration from the VAT based on certain conditions in accordance with the Federal Decree-Law No. 8 of 2017.
De-registration is a procedure that allows a business to withdraw from paying taxes either voluntarily or mandatorily.
Once the application for the deregistration is submitted to the FTA, it will check the application and cancel the VAT number provided to the entity if it has complied with the law. If the reasons are not valid and the conditions are unfulfilled, the FTA may reject the application to deregistration.
The FTA proclaimed that the UAE Tax System is based entirely on voluntary compliance by Taxable Persons, whether it is with regard to registration, filing Tax Returns and payment of due tax or de-registration.
Hence, a company can apply for the deregistration voluntarily or mandatorily, as discussed below: -
As per Article 17, a Registrant cannot apply for Tax Deregistration within 12 months of the date of
A company can go forward with voluntary deregistration procedure: -
A company can go forward with mandatory deregistration procedure: -
FTA will approve the cancellation of VAT registration for a group: -
Once the deregistration number is approved, the authorities will cancel the VAT number issued on registration. If any company wishes to reregister, they can fill the registration form once again, and a new VAT number will be issued to them.
The registrants will not be de-registered if,
Failure to submit the de-registration application within the period specified in the tax legislation will lead to the imposition of administrative penalties of Dh 10,000 as stipulated in the Cabinet Resolution No. 40 of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.
After the successful submission, you will find the application status as “Pre-Approved.” It will be “Approved” only when you clear all the liabilities.
If you have any plan to continue your business or you are waiting for any new investor, it is not advisable to move forward with the deregistration process. If such a situation arises, better keep the TRN, and file the tax return as ZERO if the company expect a good return within the next twelve months period.
CDA provides the expert services of VAT Deregistration in compliance with the VAT laws. CDA analyses the A to Z reasons and makes the deregistration process easy for you.
We identify the importance and need for VAT Services for every business entity in the UAE, and deliver a wide range of VAT services in Dubai, which include: -
Other than the VAT-related services, CDA provides various business services that include CFO Services, Auditing Services, Accounting & Bookkeeping Services, Accounting Software services and Due Diligence Services.
If you have any queries regarding VAT De-registration process or about your current business, feel good to discuss with us. CDA is there for your support!
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