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If your business must cancel its VAT registration, you apply to the Federal Tax Authority (FTA) within 20 business days of the event that triggers it. The FTA lists 30 business days from receipt of a completed application to finish the process. Source: Federal Tax Authority, VAT deregistration service and VAT Executive Regulation Article 14, checked .
The two clocks
| Clock | Whose | Length |
|---|---|---|
| Duty to apply | Yours | 20 business days from the triggering event |
| Processing | The FTA | 30 business days from a completed application |
Do not mix them up. The first can cost you money. The second only decides when you get your confirmation.
When the FTA accepts
The accepted case in Article 14(2) is that you stopped making taxable supplies and do not expect to make any for the next 12 months, and your supplies over the past 12 months were below the voluntary registration threshold. The text we hold for the second part is partly cut off, so read the regulation on the FTA site or ask a VAT consultant before relying on it. Other triggers, such as a business ending, follow the same 20 business day duty.
Steps
- Sign in to EmaraTax with UAE Pass.
- Open your taxable person account and start the VAT deregistration service.
- Attach what the form asks for and submit.
- Keep filing returns until the FTA confirms.
- File the final return for the last period.
The deregistration service runs 24 hours a day, 7 days a week on EmaraTax. Source: Federal Tax Authority, VAT deregistration service, checked .
Final return
A final return is required for the last tax period when registration is cancelled. Same rule as any other return: due by the 28th day. See VAT return filing. Settle any tax due in the same go.
Penalty
A late deregistration application is fined AED 1,000, plus the same amount on the same date each month, up to AED 10,000. Source: Federal Tax Authority, administrative penalties table, checked . If you are closing the company, plan this alongside liquidation, because the 20 day period can start before the licence is cancelled.
Before you apply
Check three things first. Your last 12 months of taxable supplies, so you know where you stand against the voluntary threshold of AED 187,500. Whether any returns are unfiled, since those will need to be sent. And whether you owe tax or penalties, which are better settled in the same period.
If you are only slowing down, deregistration may be the wrong move. If sales are likely to pick up again, you may have to register again, with a new 30 day clock and the risk of a gap. A firm can model the next 12 months with you before you decide.
After you apply
Keep the confirmation that EmaraTax gives you. Do not stop issuing tax invoices or filing returns on your own. Until the FTA confirms the cancellation, your obligations continue. Once confirmed, store your records for the retention period, which is generally 5 years after the tax period. See record keeping rules.
If you registered voluntarily and later fall below the line, ask whether the conditions above are met. A voluntary registrant is not locked in forever, but the FTA decides the application.
Common mistakes
Waiting for the licence to be cancelled before applying is the usual one. The duty runs from the triggering event, and a licence cancellation may be later than the event. Another is closing the bank account before the final return is paid. A third is forgetting that unfiled returns from earlier periods still need to be sent.
Ask a VAT consultant to check the dates if the business stopped trading months ago. The late application penalty grows month by month up to AED 10,000, so the sooner you file the less you pay.
