VAT de-registration can be done with the Federal Tax Authority (FTA) and is known as de-registration by terminating the VAT registration. Given the valid reasons for deregistration, then only it will be approved by the FTA. Only with strong reasons, a company can deregister for VAT in the UAE. It is important to know the rules and regulations in VAT de-registration as it is for registration. Only a registered taxable person can cancel his/her tax registration. The taxable person's VAT number and registration will be deactivated.
To cancel VAT registration in the UAE :-
After logging into your VAT account on FTA, you can provide the details and reason for VAT deregistration through VAT deregistration form UAE. If everything related to the de-registration is correct, then the FTA will approve it along with the clearance of:-
- Any taxes against the institution
- Any returns filed
- After paying any administrative penalties left.
When can VAT de-registration be applied by a person in the UAE
De-registration can be applied in two cases:-
- If the person doesn't plan to make any taxable supplies over the next 12 months.
- If over a period of 12 consecutive months, a person's taxable supplies are less than the voluntary registration threshold and in the next 30 days, do not anticipate to cross this border.
When does the FTA cancel a registration in the UAE ?
- If either of the conditions listed above does not satisfy the FTA, they can cancel the person's de-registration.
- This is a great option for people who have registered under VAT but don't want supplies requiring registration. After satisfying the eligible conditions, the registered ones can apply for de-registration.
Penalty for VAT De-registration
If within 20 business days, the penalty( AED 10,000) for failing to apply for a mandatory de-registration of VAT is not applied, it will not be accepted.
The process after submitting the application :-
All the details and reasons should be submitted electronically. After this, the applicant will get a confirmation SMS for submission on their registered number. After analyzing for any pending penalties or tax payments, FTA will approve the application. The VAT registration will be cancelled if everything is based on the FTA rules and regulations.