How to de-register under VAT in UAE?

VAT deregistration allows taxable persons to cancel their VAT registration UAE and Tax registration number (TRN). It can be done online through the Emaratax portal. This is an important step companies can take to avoid non-compliance penalties if they stop business activities on VAT supplies. This article helps you learn about how to de-register under VAT in UAE, its eligibility criteria, time limit, and the penalties for late deregistration. 

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Who should de-register under VAT?

VAT registrants must submit a deregistration application within 20 business days if they stop business activities related to VAT-taxable supplies. The following are the conditions under which a business or taxable person can apply for VAT deregistration.

• If a taxable person or a business does not currently produce taxable goods and does not anticipate doing so within the next 12 months.
• If a taxable person or a business is still producing goods, but the total value over the past 12 months falls below the voluntary registration threshold of AED 187,500.
• If a taxable person or a business produces taxable goods, but the total value in the previous 12 months was below the mandatory registration threshold of AED 375,000, and it has been 12 months since the date of voluntary registration.

Documents and Forms required for VAT deregistration

The following are the documentary requirements you should have to complete the deregistration application process,

• Copy of Canceled Trade License, Liquidation Letter, and Board Resolution
• Latest Financial Statements (Trail Balance, P&L Statement, or Balance Sheet) - Audited or Unaudited
• Ministry of Labour Letter on Employee Count
• Old and Amended Sales Contracts or Licenses
• Amended Company Setup Contract
• Financial Turnover Template (Taxable Income and Expenses)
• Ministry of Labour Letter Confirming Employee Count
• Proof of Business Activity Cessation (if applicable)
• Business Itinerary Chart Including Suppliers and Importers
• Signed and Sealed Official Letter acknowledging the business absence within the UAE. (If required)
• Sample Invoices
• Duplicate TRN Declaration
• Official Letter Indicating Used TRN
• TRN Certificate from Head Office business

Also read: Documents required for VAT registration in UAE

How to apply for FTA VAT de-registeration Online?

You need to access your EmaraTax dashboard to initiate VAT deregistration. Enter your login credentials or UAE Pass to access your EmaraTax dashboard. Your EmaraTax online user dashboard will appear. You need to use 2-factor authentication, log in by entering the OTP you received in your email and mobile number. UAE Pass have different login process, but you will get back to EmaraTax dashboard once it is successful. 

1. Select your Company on the EmaraTax Dashboard

After accessing the EmaraTax dashboard, you will find the Taxable Person list associated with your profile. Choose the Taxable Person from the list and click on 'View' to access the dashboard. If there are no linked Taxable Persons, you must create one.

2. Click "Deregister" in the VAT Tile

To initiate the VAT deregistration application, click on the 'Actions' button on the VAT tile, and then select 'Deregister'.

3. Edit, Update Information & Proceed with Deregistration

• Select 'Edit/Review' to make changes to your bank details prior to entering the deregistration application.
• Click for 'Proceed to De-Registration' to directly access the VAT deregistration application.
• Ensure you have all the necessary documents for VAT deregistration in the UAE, then accept the terms.
• Click 'start' to initiate the deregistration process.

4. Fill the required info and Upload the Documents in Accepted Formats

• Complete all necessary fields and attach documents in approved formats when filling out the application.
• Verify that all supporting documents are included within the application to prevent any potential rejection or the need for resubmission.
• Certain VAT registration information will be automatically populated in the de-registration form.
• Choose the appropriate basis for VAT deregistration to access relevant input fields and sections.

5. Enter the Eligible Date for Deregistration

• The eligible date for deregistration will be determined based on the selected deregistration option.
• The effective date of deregistration will be automatically generated in EmaraTax according to the eligible date.
• If necessary, you can modify the effective date for deregistration, provided with valid reason.

6. Fill or Update the Excel on Taxable Supplies

Here's how you should proceed with presenting the taxable products and expenses to support the application:

• Input the figures exclusively in UAE Dirhams (AED) for taxable products and expenses.
• Save your entries and proceed to the 'Authorized Signatory' section by clicking on 'Next Step'.

7. Verify Authorized Signatory details

• Click Next Step to jump to the next section after verifying the authorized signatory details.
• Use the Previous and "Next" buttons to go back and forth for verifying and proceeding with the final step to deregister VAT.

8. Review & Declare

• Ensure the details you entered in the application are highlighted

• You should review and check the accuracy of the details before the submission.

• Click "Submit" to submit the deregistration application.

Learn more: How to de-register or amend a tax group under VAT in UAE?

Consequences of Late VAT de-registration in UAE

• Penalty: You could face a fine of AED 1,000, increasing by AED 1,000 every month, up to a maximum of AED 10,000. This applies if you miss the 20-business-day deadline for compulsory de-registration.
• Tax returns: You must keep filing VAT returns until your de-registration is approved and your final return is generated.
• Deemed supply: Any remaining business assets or goods might be considered a "deemed supply" and need to be reported in your final VAT return.

Conclusion

Knowing how to navigate VAT deregistration in the UAE is essential for businesses ceasing VAT-related activities. This article outlined the eligibility requirements, documentation needed, and the online application process through the EmaraTax portal. Remember, timely application is essential to avoid penalties. Consult with Filings.ae experts for personalized guidance VAT registration UAE and deregistration.

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