How to Apply for Corporate Tax Deregistration in the UAE?

Introduction

Many companies in the UAE may reach a point where they no longer need to be registered for corporate tax. This could happen when a business shuts down, closes a branch, or stops its taxable activities. In such cases, the business must apply for corporate tax deregistration with the Federal Tax Authority (FTA).

In this blog, we will explain everything you need to know about corporate tax deregistration in the UAE. We will keep it simple and easy to understand.

Note :- If your business in the UAE is closing or no longer meets the requirements for corporate tax registration, it’s important to apply for Corporate Tax Deregistration with the Federal Tax Authority (FTA). Our team at Golden Falcon Consultants ensures a smooth and compliant deregistration process, helping you avoid penalties and complete all legal formalities on time.

What Is Corporate Tax Deregistration?

Corporate tax deregistration means cancelling a company’s registration with the UAE’s tax authority for corporate tax purposes. When a company is no longer doing business, or no longer needs to pay corporate tax, it must apply to the FTA to cancel its Tax Registration Number (TRN).

This process is important because the government needs to know that the company is no longer operating or no longer needs to pay tax.

When Should You Apply for Deregistration?

You should apply for corporate tax deregistration in the following situations:

The company is shutting down

If your business is closing permanently, you must inform the FTA and apply for deregistration. This tells the FTA that you will no longer be earning income from the company and will not be paying tax.

The company is sold or merged

If your business is sold to someone else or merged with another company, it may no longer need a separate tax registration. In this case, deregistration is required.

The company is no longer earning taxable income

If your business has stopped earning income that is taxable under UAE corporate tax rules, and you are sure it will not earn such income in the future, you can apply to cancel your tax registration.

Why Is Corporate Tax Deregistration Important?

Applying for corporate tax deregistration is not just a formality. It is a legal requirement. If you don’t apply when required, you may face penalties.

Here’s why it’s important:

You avoid penalties

The FTA can impose fines if you don’t cancel your tax registration on time. The deadline to apply is within 3 months from the date your business stops being taxable.

You keep your tax record clean

Timely deregistration shows that your business follows the rules. This can help you if you plan to open a new business later or deal with government departments.

You avoid unnecessary filings

If you don’t cancel your TRN, the FTA will still expect you to file corporate tax returns, even if your business is not operating. This can cause extra work and stress.

Who Needs to Apply for Deregistration?

Here are the types of businesses that need to apply for corporate tax deregistration:

Companies that are closing down

If a business is winding up operations permanently, it must apply for deregistration.

Companies that no longer meet the registration threshold

If your business was registered for corporate tax but your income has dropped below the required amount and will not go up again, you can apply to cancel your registration.

Free zone businesses ending operations

Companies based in UAE free zones that are closing or changing their business type may also need to apply.

Documents Required for Corporate Tax Deregistration

When applying for corporate tax deregistration, you will need to upload some documents to support your request. These include:

1. Business license cancellation

You must show proof that your trade license has been cancelled or is in the process of cancellation.

2. De-registration letter from the authority

If you are in a free zone, you may also need a de-registration letter from the relevant free zone authority.

3. Final tax return

You must file a final corporate tax return up to the last day your business was taxable. This must be done before or during the deregistration process.

4. Clearance of tax dues

You must settle any pending taxes, fines, or dues with the FTA before your deregistration request can be approved.

Step-by-Step Guide to Apply for Corporate Tax Deregistration in the UAE

The process is simple if you follow the steps properly. Here’s how to apply for corporate tax deregistration:

Step 1: Log into your EmaraTax account

Go to the EmaraTax website and log in using your account details.

Step 2: Go to the “Taxable Person” profile

After logging in, click on your company name under the “Taxable Person” section.

Step 3: Select “De-Registration”

You will see an option for “De-Registration” under the tax types section. Click on this.

Step 4: Fill in the deregistration form

You need to answer questions such as:

• Why are you applying for deregistration?
• When did the company stop doing business?
• Have you cancelled your business license?

Step 5: Upload required documents

Upload all the documents mentioned earlier, like the trade license cancellation proof and final tax return.

Step 6: Submit your application

Once you review everything, submit the application to the FTA for approval.

What Happens After You Apply?

Once you submit your deregistration application, the FTA will review it. Here’s what happens next:

Review of documents

The FTA checks all the documents to make sure everything is complete and correct.

Communication from the FTA

If the FTA needs more information or documents, they will contact you through your EmaraTax account or by email.

Approval or rejection

If everything is in order, the FTA will approve your application and send you a deregistration confirmation. If there is a problem, your application may be rejected, and you will need to fix the issues and reapply.

Important Deadlines to Keep in Mind

To avoid fines, you must apply for corporate tax deregistration within 3 months from the date your business stops being taxable. If you apply late, the FTA can charge you with a penalty of AED 1,000, which may increase if the delay continues.

So, always apply on time.

Common Mistakes to Avoid During Deregistration

Many businesses make simple mistakes that lead to delays or rejections. Here are some common ones:

Not filing the final tax return

You must file your last tax return before or during the deregistration process.

Not cancelling the trade license

If your trade license is still active, your application may be rejected.

Giving incorrect information

Make sure all information in your application is correct and matches your documents.

Can a Deregistered Business Start Again?

Yes, a business that has been deregistered for corporate tax can start again. But if you start operating again, and you meet the requirements to register for corporate tax, you must apply for a new TRN.

You cannot use the old registration once it is cancelled.

Who Can Help with Corporate Tax Deregistration?

If you’re not sure how to apply or want to make sure you don’t make any mistakes, you can get help from:

Tax consultants

A tax consultant or advisor can guide you through the process, help with documents, and apply on your behalf.

Business setup service providers

If you used a business setup service to open your company, they can often help you with deregistration too.

Legal and financial advisors

Some companies have legal or finance teams who can handle this process for you.

Final Thoughts

Corporate tax deregistration is a simple but important process for companies that are closing or no longer need to pay tax in the UAE. If you don’t apply on time, you may face penalties and extra work.