Guide to VAT De-registration and TRN Cancellation in the UAE

As business and tax systems and regulations rapidly evolve in the UAE, businesses must understand the requirements for VAT deregistration or VAT cancellation. VAT deregistration is required if a company does not meet the VAT registration requirements in the UAE and candel its Tax Registration Number (TRN) with the UAE’s Federal Tax Authority through deregistration process. It is imperative to understand the VAT deregistration procedures and TRN cancellation processes in Dubai, UAE, as complying with UAE tax obligations will help a business avoid penalties for non-compliance.

One can cancel VAT registration through Emaraportal, just like VAT registration and VAT return filing in the UAE.

In this blog, let’s take some time to explore the cancellation of VAT registration and TRN in the UAE.

Key Checklist for VAT deregistration and TRN cancellation in the UAE

When a business ceases its VAT-related activities, a taxable person must apply for UAE VAT deregistration within 20 business days. One must be eligible to apply for UAE VAT deregistration as follows:-

• The business has ceased taxable transactions and has no plans to expect taxable supplies in the next 12 months.
• If your total taxable turnover in the previous 12 months remained under AED 187500 and is projected to stay below the voluntary registration limit for the next 30 days.

A person who chooses to voluntarily register for VAT cannot apply to deregister with the authorities in the same year they registered. The UAE Federal Tax Authority also imposes a penalty of AED 1,000 for each month of delay in deregistration from VAT upto maximum penalty of AED 10,000.

The process of deregistration of VAT in the UAE involves many steps, such as

• Check Eligibility: Ensure your business qualifies for deregistration.
• Prepare Documentation: Gather financial records and proof that business operations have ceased.
• Submit on FTA Portal: Complete your deregistration request via the FTA portal and upload all required documents.
  Await FTA Review: The UAE FTA may ask for additional details before processing your request.
• Receive Confirmation: Once approved, you’ll get confirmation of your VAT deregistration.

Understanding the UAE VAT deregistration TRN is a bit complex, but Jaxa Chartered Accountants, a UAE FTA-registered tax agent, is here to support you throughout the compliance process. Our experienced VAT consultant in the UAE ensures that your UAE VAT registration is done properly and confirms that your business remains compliant, avoiding unnecessary penalties. Our team will handle all your paperwork while you can focus on business operations.

Understanding TRN De-Registration in the UAE

UAE Tax Registration Number (TRN ) deregistration is an official procedure by which a business is removed from the UAE’s VAT system. A business receives a unique TRN upon VAT registration to track its tax liabilities.  There are certain cases where the business needs to cancel the TRN with the UAE’s FTA.

Here are the common reasons for UAE TRN Registration:-

• If taxable turnover falls below AED 375,000.
• If a business stops operations.
• If there is any change in business structure impacting UAE VAT registration, deregistration may be required. 

Importance of Cancelling UAE TRN on Time

When your business no longer qualifies for VAT registration in the UAE, holding on to the UAE TRN can invite compliance risks. Here is why timely deregistration is necessary.

• Ensure Legal compliance: The UAE mandates that UAE TRN registration be canceled when the UAE VAT registration requirements are not met. Missing the deadline may expose your business to administrative penalties.
• Cut Out Unnecessary UAE VAT compliance: Keeping UAE TRN active despite being ineligible for VAT may lead to unnecessary tax filing and compliances adding to cost.
• Save money: Cancelling UAE TRN can avoid paying VAT you no longer owe along with other compliance costs.

Need guidance? Our team of seasoned professionals in Dubai at Jaxa helps to guide your business through every step of the TRN deregistration process confidently.

Common Pitfalls to Avoid in VAT Deregistration in the UAE

The process of cancelling a tax registration in the UAE can be complicated. Watch out for the common mistakes during the VAT deregistration process in Dubai.

• Unpaid taxes: clear all the outstanding taxes before the TRN is cancelled.
• Unfiled returns: Ensure all tax returns are filed on time to avoid penalties.
• Missing documentation: Make sure business closure is reflected in all records and retain all records for future audits.

Why is JAXA a trusted partner for Deregistration UAE VAT TRN?

Jaxa Chartered Accountants is a leading firm in the UAE and Dubai, offering expert services in taxation, accounting, bookkeeping, audit, and assurance. Our certified VAT consultants provide comprehensive solutions, including registration, deregistration, compliance, audits, and return filing. As a UAE FTA-registered tax agent, Jaxa is well-versed in local tax regulations and committed to delivering personalized, cost-effective, and client-focused financial solutions. We ensure timely and hassle-free VAT deregistration, meeting all deadlines with precision and efficiency.

Ease your UAE VAT deregistration and TRN cancellation with the Jaxa team. Get in touch with us now!.