VAT De-registration

De-registering your Tax Registration Number (TRN) is as important a registering for VAT. The Federal Tax Authority (FTA) has made it mandatory to de-register for VAT if the business meets certain criteria.

Administrative penalties have been imposed if the de-registration procedure isn’t carried out or has been delayed.

When to De-register for VAT?

A taxable person can be deregistered under 2 factors:

Mandatory De-registration

Conditions:

• The business has stopped making taxable supplies; OR
• If the turnover did not exceed AED 187,500 in the 12 months after registering with the FTA.

Timeframe to avoid penalty:

• 20 working days within the period any of above conditions are triggered.

Voluntary De-registration

Conditions:

• The business has not made supplies or expenses above the threshold of AED 375,000 in the past 12 calendar months; OR
• 12 calendar months have passed since the entity was registered with FTA under voluntary registration.

Time Frame to avoid penalty:

• Since this is a voluntary deregistration, there is no time-frame involved.

Things to do before De-registering