Business Setup & Formation
VAT Deregistration
VAT Deregistration refers to the cancellation or termination of a business’s VAT registration. Under the Federal Tax Authority (FTA) regulations, a business can apply for VAT deregistration in the following scenarios:
1. Mandatory VAT Deregistration
A registrant must apply to the FTA for deregistration if:
They have stopped making taxable supplies.
The total value of taxable supplies in the previous 12 consecutive months falls below the voluntary registration threshold (AED 187,500), and the registrant does not expect to exceed the mandatory registration limit in the next 30 days.
2. Voluntary VAT Deregistration
A registrant may request VAT deregistration from the Federal Tax Authority (FTA) under the following conditions:
The value of taxable supplies in the past 12 months is below the mandatory registration threshold (AED 375,000).
At least 12 consecutive months have passed since the entity was initially registered with the FTA.
HOW TO APPLY FOR VAT DEREGISTRATION ?
VAT deregistration can be requested through the FTA Online Portal. Once logged in, you can access the VAT deregistration form and submit the required details along with supporting documents. Some information will be automatically populated from the existing registration records.
The FTA’s approval of the deregistration request depends on the validity of the reason provided and compliance with all applicable regulations.
a. Pending VAT liability
b. Filed returns
c. Administrative penalties
Deregistration Penalty
Failure to apply for VAT deregistration within 20 business days will attract a fine of AED 10,000.