VAT De-Registration Process for UAE Firms in 2025 Explained

Closing a VAT account is not just a portal click. The decision must match statutory triggers, evidence must be tidy, and final returns must clear all balances. 

Under UAE VAT law, most firms must apply for deregistration within 20 business days of meeting a trigger, a timeline that the Federal Tax Authority sets out in its VAT deregistration guidance at.

This guide answers what is vat de-registration, what is the deadline to deregister it, and shows how to prepare a file that gains approval without repeated clarifications.

Triggers That Require or Allow Deregistration

• Business stops making taxable supplies on a continuing basis.
• Mandatory threshold no longer applies and is not expected to be met in the next 30 days.
• The legal entity is liquidated, merged, or transferred and the VAT registration is no longer required.
• Voluntary cases where activity remains below the voluntary threshold and carrying a VAT number adds cost or risk.

Important Advice: A short memo should be present on file stating when to apply for vat de-registration, with dates, turnover tests, and board approval.

Timeline and Deadlines

Authorities expect prompt action once conditions are met. A clean timeline for deregistration VAT UAE includes the trigger date, board sign-off, portal submission, final return due date, and the date by which input and output tax are fully reconciled. 

Firms that delay face administrative penalties that build up to AED 10,000 and review questions on why the number stayed active after activity fell away.

What Happens to Invoices and Contracts After VAT De-Registeration?

From the effective date, tax invoices should no longer be issued. Open contracts must be reviewed to determine any final tax impact. Stock on hand and capital assets can trigger output tax on deemed supplies where recovery rules apply. Asset schedules and credit notes must be aligned before the final return is filed so there is no residual balance that blocks closure.

Documents and Information to Prepare While Doing VAT De-Registeration

• Trade licence, liquidation or transfer documents if relevant, and board resolution approving the request.
• Trial balance, VAT control account reconciliation, and aging of receivables and payables.
• Fixed-asset register with acquisition dates and recovery positions for deemed-supply checks.
• Evidence of activity levels showing the registration threshold is no longer met.
• Bank account validation letter for any refunds due.
• Copies of the last filed VAT return and payment proofs.

VAT De-Registration Procedure: Step-by-Step

1. Log in to EmaraTax and open the VAT de-registration procedure.
2. Confirm trigger reason, proposed effective date, and attach supporting evidence.
3. Reconcile the VAT control account and declare expected final tax on stock or assets.
4. Submit the request and respond to clarifications with reconciled schedules.
5. File the final VAT return for the assigned period and settle any payable or request remaining refunds.
6. Receive the deregistration approval and save the acknowledgement to the archive.

If the procedure feels confusing, hire expert VAT de-registration services to ensure the procedure is done smoothly without failure.

Final Return and Refunds

The final return closes the account. If the ledger shows a receivable, the refund route remains available, subject to the same evidence standards as routine claims. If a payable remains, the settlement must clear before approval. Keep a short note that explains any deemed-supply calculations and references to asset registers, because reviewers often ask for this exact linkage.

How Much is The Deregistration VAT Fee in Dubai?

Confused about what is the deregistration VAT fee in Dubai? Deregistration is a federal process on EmaraTax, and there is no official fee imposed by the Federal Tax Authority.

However, advisory and liquidation costs vary by provider and complexity. As it’s an important procedure, and things are not that cleared, we highly recommend hiring professional services for VAT deregistration that ensures that the procedure is done within 20 days of the time period.

Accounting Clean-Down After Approval

Once the number is cancelled, systems must lock VAT codes, invoice templates should switch to non-VAT formats, and procurement workflows must stop posting input tax. Contracts and price lists require an update so counterparties do not expect tax to be charged. Archival rules continue to apply; records must be retained for the statutory period for any later review.

Mistakes That Slow or Block Deregistration

• Submitting without a reconciled VAT control account or with open, unexplained balances.
• Ignoring deemed-supply checks on inventory and capital assets.
• Selecting an effective date that does not match the trigger evidence or liquidation timeline.
• Missing bank validation where a refund is due, causing payment delays.
• Leaving invoice templates active so post-effective-date sales still show tax.

Governance for Finance Heads

A simple playbook works best: board minute approving closure, threshold memo, reconciled control account, asset schedules, and a final-return pack with payments or refund request.

A one-page chronology avoids disputes about the effective date. After approval, internal comms should go to sales, procurement, and IT on the same day so stray VAT entries do not creep back into the ledger.

Final Advice

If done wrong, administrative penalties up to AED 10,000 can be imposed while trying to deregister VAT.

Arnifi prepares deregistration files end-to-end: trigger memo, reconciliations, deemed-supply checks, portal submission, final return, and refund or payment closure. 

Our expert team aims to finish with a zero balance, clean approvals, and systems locked so VAT cannot be charged after the effective date.

FAQs

What is VAT de-registration?

It is the formal cancellation of a VAT registration when statutory conditions are met, followed by a final return that clears all VAT balances.

How long does approval take?

Straightforward cases clear quickly. Complex cases involving liquidation, mergers, or large refunds take longer because reviewers ask for more evidence.

Can an entity re-register later?

Yes. If activity resumes or thresholds are expected to be met, a fresh registration can be filed.

What happens to input tax credits after deregistration?

Unclaimed credits can be requested through the final return and refund process, provided evidence meets the standard.

Does a free zone company follow a different path?

No. The portal and evidential standards are the same. Substance and designated-zone rules only affect how the final return is calculated, not the mechanics of closure.