VAT Deregistration Services – VAT Deregistration in the UAE
In the dynamic business environment of the UAE, certain companies may need to deregister from VAT to maintain compliance and avoid penalties. Our firm, specializing in accounting and VAT consultancy services, provides expert guidance through the VAT deregistration process.
With over 25 years of dedicated services, we are a reliable partner for all your VAT needs.
Understanding VAT Deregistration in the UAE
VAT deregistration is an essential procedure for businesses that no longer meet the criteria for VAT registration OR have ceased their taxable activities. This process helps businesses cancel their VAT registration with the Federal Tax Authority (FTA) to ensure compliance with local tax laws.
Importance of Timely VAT Deregistration
Since the implementation of VAT in the UAE, businesses have been diligent about registering with the FTA. However, understanding when and how to deregister is equally important. Failing to deregister timely can result in administrative penalties for late applications.
Our consultancy ensures that you are aware of the specific conditions under which VAT deregistration is required and guides you through the entire process.
When De-registration is Necessary:
Several factors may trigger the need for VAT deregistration, including:
- Cessation of Activities: If your business ceases operations entirely and no longer engages in VAT-related supplies, deregistration is mandatory.
- Falling Below the Threshold: Businesses exceeding the AED 375,000 taxable supply threshold within 12 months are required to register for VAT. Conversely, businesses consistently falling below this threshold for a period of 12 consecutive months can opt for deregistration.
Eligibility for VAT Deregistration
VAT-registered businesses in the UAE must deregister from VAT under specific conditions as mandated by the Federal Tax Authority (FTA).
The criteria for obligatory deregistration include:
- Annual Turnover Below AED 187,500: If 12 months have passed since the date of tax registration and the annual turnover on taxable goods remains below AED 187,500.
- Ceased Sales of Taxable Supplies: If the business has stopped selling taxable supplies.
- Future Taxable Supplies Below Threshold: If the total value of anticipated taxable supplies or expenses subject to tax in the next 30 days will not exceed the registration threshold.
Business Closure: If the company has completely closed.
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Deregistration Process
The VAT deregistration process can be completed online through the FTA portal. Once the application is submitted with the necessary supporting documents, the FTA will verify and, if approved, cancel the VAT registration.
Circumstances for Refusal of Deregistration
The FTA may refuse to deregister a business under the following conditions:
- Late Submission: If the application is not submitted within 20 business days.
- Insufficient Supporting Documents: If the provided documents do not adequately support the application.
- Unpaid Taxes and Penalties: If there are any outstanding taxes or administrative penalties.
- Unfiled Tax Returns: If all required tax returns for the registered period have not been filed.
Failure to submit the VAT deregistration application within the specified timeframe can result in a penalty of AED 10,000 as per Cabinet Resolution No. 40 of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.
Deregistration Deadline
The key point to clarify is the 20-day deadline. It applies to after the VAT deregistration condition is met, not after the tax year end.
- A reason for deregistration arises (e.g., your annual turnover falls below the threshold, you cease taxable supplies, etc.).
- From that date, you have 20 business days to submit your deregistration application through the FTA portal.
VAT De-Registration Process:
- Access the FTA EmaraTax portal: You’ll need your login credentials.
- Locate the Deregistration section: The exact steps might vary slightly depending on the portal interface.
- Initiate the deregistration application: Follow the on-screen instructions, providing the required information and supporting documents.
- Submit the application: Review everything thoroughly before final submission.
- FTA review and processing: The FTA will assess your application. If approved, your VAT registration will be canceled.
Additional Considerations
- Final VAT Return and Payment: You’ll need to file a final VAT return and settle any outstanding VAT liabilities within 28 days of deregistration.
- Penalties for Late Application: A late application fee of AED 10,000 may be imposed if you submit beyond the 20-day timeframe after meeting a deregistration condition.
Why Beaufort Associates?
We provide comprehensive support to ensure that your de-registration is handled efficiently and in full compliance with the FTA regulations. Trust our experienced team to manage your VAT de-registration process with professionalism and expertise, ensuring your business remains compliant and penalty-free.
Contact us today to learn more about our VAT deregistration services and how we can assist you.
Benefits of Utilizing Our Services:
- Compliance Expertise: Avoid potential penalties with our guidance on the deregistration process and adherence to FTA regulations.
- Efficiency and Accuracy: Streamline the deregistration process with our efficient team handling the necessary formalities.
- Peace of Mind: Gain peace of mind knowing your VAT obligations are expertly managed throughout the deregistration process.
Contact Us to Cancel Your VAT Registration
Our experienced tax agents are here to assist you with all VAT-related requirements, ensuring timely submissions and preventing penalties. From VAT registration and accounting to returns filing and deregistration, we support your business every step of the way.
Trust us to handle the complexities of VAT compliance, allowing you to focus on your core business activities with peace of mind. For more information or assistance with any tax-related matters in the UAE, please feel free to Contact Us.