A taxpayer or business in the UAE may cancel their VAT registration and Tax Registration Number (TRN) through VAT deregistration. FTA VAT Deregistration is an online procedure or digital method. The only companies and people that will de-register from VAT are those that are registered below the Federal Tax Authority (FTA). The penalty for late VAT deregistration is 10,000 AED.
Who Needs to Unregister from the UAE VAT?
A company or an individual registered below the VAT threshold may only file for VAT Deregistration in the following situations.
- Businesses and individuals must deregister VAT if they discontinue producing taxable goods and do not anticipate producing any during the next 12 months.
- The company or individual must deregister VAT if they continue to produce taxable goods but their total value during the previous 12 months is less than the AED 187,500 voluntary registration threshold.
- If the company or an individual keeps producing taxable goods but the value within the previous year was less than the required threshold for registration (AED 375,000) and a full year has passed since the beginning of registration, you are allowed to submit an application for VAT deregistration.
A person who voluntarily registered below VAT is not eligible to apply for de-registration within a year of their registration date. AED 10,000 is the late VAT Deregistration fine. Within twenty working days of the prevalence of these events, an individual shall submit an application for VAT deregistration. Registrants just need to use their FTA portals to apply for VAT deregistration.
It is important to note that there will be a 10,000 AED late de-registration penalty imposed if the date of completion of this de-registration form is more than twenty working days after the taxable person is required to cancel. Businesses that have shut down should have a government-issued organization closure letter to provide as proof of VAT deregistration.
Application Process for the UAE’s FTA VAT De-registration
Companies should log into their VAT portals to finish their VAT Deregistration. Click the De-Register button located next to the VAT registration on the dashboard. The person’s tax information is pre-filled out on the de-registration form. Give reasons for the de-registration of VAT. Select your de-registration basis for VAT from the drop-down selection.
A valid start date for de-registration depends on whether the taxable person is required or qualified to do so. Select Choose Files to upload any necessary supporting files. Before submission, check and validate the application’s licensed signatory and declaration section.
Following the application, FTA may review the VAT de-registration form and, if they find that the VAT De-registration is valid, change the status of the application to Pre-Approved. The businesses must subsequently submit the final VAT return. To complete the VAT Deregistration process, enterprises must pay off all outstanding debts by the time the last VAT return is filed.
You can get help from KSP Accounting and Bookkeeping to de-register your company from the FTA. Your convenience is our top priority at KSP Accounting and Bookkeeping. We can ensure that the VAT deregistration process is finished without incurring any FTA VAT penalty. So, feel free to get in touch with us for any type of VAT de-registration service in Dubai!