VAT deregistration
Navigating the complexities of VAT deregistration can be challenging. Whether you’re closing your business, changing your business structure, or falling below the VAT threshold, our expert team is here to help. We offer comprehensive VAT deregistration services to ensure a smooth and compliant transition.
What is the time frame for VAT deregistration?
What are the different types of of VAT deregistration?
Businesses contemplating VAT deregistration can opt for one of two services. These include:
1. Mandatory VAT Deregistration
Under this classification, businesses must undergo deregistration within 30 days if any of the following circumstances apply:
- No longer completing economic activities
- No longer making taxable supplies
- No longer hold a legal entity status
2. Voluntary VAT Deregistration
A taxpayer can come under this classification if the following applies:
- In the last 12 month period, their taxable sales value is between the voluntary and mandatory thresholds.
- In the next 12 month period, their taxable sales value is between the voluntary and mandatory thresholds.
The procedure
- Document Compilation: Begin by assembling all essential documents essential for VAT deregistration (including: the VAT Deregistration Application Form, original Emirates ID and passport of the authorised signatory, a formal letter outlining the rationale behind the deregistration request along with supporting evidence, VAT tax invoices and credit notes, financial statements and a customs registration cancellation certificate).
- Settlement of Outstanding Liabilities: Prior to initiating the VAT deregistration process, ensure the settlement of any pending VAT tax invoices and credit notes.
- Application Submission: Submit the completed VAT Deregistration Application Form, accompanied by the necessary documents, via the EmaraTax portal to the Federal Tax Authority (FTA).
- Await Review: The FTA will review the submitted application and might potentially request additional information if deemed necessary. Upon approval, the FTA will issue a VAT deregistration certificate.
- System and Record Update: Promptly update your business records and systems to reflect the VAT deregistration status.
Details for VAT Deregistration Submission
An application must include:
- The registrant’s name
- Tax registration number
- Justification and evidence of deregistration conditions
- Date of cancellation condition
- Value of supplies and expenses over the past and forthcoming 12-month periods.
VAT deregistration holds equal significance to registration, and awareness of the rules and procedures governing VAT cancellation is imperative, as any failure to comply with specific timeframes may result in penalties that can easily be avoided.
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