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VAT deregistration in the UAE is the process through which a business cancels its VAT registration with the Federal Tax Authority (FTA) when it is no longer required or eligible to remain registered. Businesses must apply through the EmaraTax platform and provide supporting documents that demonstrate the reason for deregistration. The exact documents depend on why the business is applying for VAT deregistration.
Understanding the Deregistration of Vat in UAE and documentation requirements can help businesses avoid delays, incomplete applications, and requests for additional information. The FTA currently lists its VAT deregistration service as free of charge, while professional consultancy or accounting fees may apply if a business engages an adviser to prepare and submit the application. The FTA states that a completed application is generally processed within 20 business days.
What Documents Are Required for VAT Deregistration?
The documents required by the FTA depend mainly on the basis and reason selected in the EmaraTax application. Businesses should therefore prepare documents that clearly support their particular situation rather than submitting the same document set for every application.
Business Has Stopped Making Taxable Supplies
If a company has stopped making taxable supplies because its business or licence has been cancelled, the FTA may require a copy of the cancelled trade licence, liquidation letter, and board resolution. The business may also need to provide its latest financial statement, such as a trial balance, profit and loss statement, or balance sheet. A letter confirming the number of employees may also be requested depending on the circumstances.
For a natural person or sole establishment, evidence proving cessation of business activities may be required. The applicant may also need to provide a financial turnover template showing taxable income and expenses from the date of VAT registration.
Business Has Sold Its Licence
When VAT deregistration is connected with the sale of a licence, supporting documents can include the old and amended sale contract or licence, an amended company setup contract, and a financial turnover template covering the relevant period. The FTA may also require evidence concerning employees.
Taxable Supplies Have Fallen Below the Threshold
A business may seek deregistration when its taxable supplies fall below the applicable voluntary registration threshold. The FTA currently identifies AED 187,500 as the voluntary registration threshold and AED 375,000 as the mandatory registration threshold for VAT purposes. Depending on the selected reason, applicants may need to provide a financial turnover template, recent financial statements, and an official declaration confirming that the business will not exceed the applicable registration threshold during the following 30 days.
Supporting Evidence for Exempt or Out-of-Scope Activities
If the business is no longer making taxable supplies because its activities are outside the scope of VAT or are exempt, additional evidence may be necessary. The FTA can request a chart describing the business activities, suppliers, importers, and the countries where customers and suppliers are located. Financial turnover information, recent financial statements, an official signed and stamped letter, and sample invoices may also be required depending on the application.
What Forms Are Used for VAT Deregistration?
The FTA provides templates that may be required as part of the online VAT deregistration application. These include the Taxable Expenses and Taxable Supplies templates. The applicant should complete the relevant template according to the basis of deregistration and the information requested in EmaraTax.
The FTA currently accepts several file formats for supporting documents, including PDF, Excel, Docs, JPG, PNG, and JPEG, with an individual file size limit of 5 MB on the current service page.
How to Submit VAT Deregistration Documents Through EmaraTax
The VAT deregistration application is submitted online through EmaraTax. The taxpayer should access the EmaraTax dashboard, open the relevant Taxable Person Account, select VAT, choose Actions, and then select De-Register. The applicant must provide the requested information, select the applicable deregistration basis and reason, and upload the supporting documents.
It is important to make sure that the information in the financial records, turnover templates, declarations, and supporting documents is consistent. If the application is incomplete or the FTA requires additional information, the Authority may request further documentation and the processing time can be extended.
What Happens After VAT Deregistration?
Approval of the application does not remove the need to complete outstanding VAT obligations. According to the FTA, the final VAT return must be submitted and any payable tax settled no later than 28 days from the effective date of deregistration, which corresponds to the end of the final tax period. Once the deregistration application is approved, the taxpayer can download the VAT deregistration certificate from the EmaraTax dashboard.
Businesses should also retain relevant VAT records and supporting documents according to applicable UAE tax record-keeping requirements. Proper documentation is particularly important if the FTA requests clarification or supporting evidence after the application has been submitted.
Takween Advisory can assist businesses with understanding VAT deregistration requirements, preparing supporting information, reviewing the application, and navigating the EmaraTax process. Professional assistance can be useful when deregistration involves business closure, liquidation, changing business activities, or complicated turnover records.
Frequently Asked Questions
What documents are needed for VAT deregistration in the UAE?
The documents depend on the reason for deregistration. They can include a cancelled trade licence, liquidation letter, board resolution, financial statements, turnover templates, official declarations, sales contracts, amended licences, and other evidence supporting the selected deregistration reason.
Is VAT deregistration free in the UAE?
Yes. The FTA currently lists its VAT deregistration service as free of charge. However, businesses may incur professional fees if they hire a tax consultant or adviser to assist with the application.
How long does FTA VAT deregistration take?
The FTA currently states that it generally takes up to 20 business days to complete a VAT deregistration application after receiving a completed application. Additional information requests can extend the process.
Do I need to submit a final VAT return after deregistration?
Yes. The FTA states that the final VAT return must be submitted and any payable tax settled within 28 days from the effective date of deregistration.
Can I deregister for VAT if my business is still operating?
Potentially, depending on the nature and value of the business's taxable supplies and the applicable VAT registration requirements. The FTA assesses deregistration based on the reason and circumstances provided in the application, so businesses should verify their eligibility before submitting a request.
Where do I apply for VAT deregistration in the UAE?
VAT deregistration applications are submitted electronically through the FTA's EmaraTax platform. The taxpayer must select VAT deregistration and provide the required information and supporting documents.