Definition

Voluntary Deregistration is the process by which a VAT-registered business in the UAE applies to cancel its VAT registration with the Federal Tax Authority (FTA) because it no longer meets the threshold for mandatory registration.

Key Points

• A business can apply if taxable supplies in the past 12 months are below AED 187,500.
• The request must be submitted through the EmaraTax portal.
• All outstanding VAT returns and payments must be completed before deregistration.
• The FTA typically processes deregistration requests within 20 business days if all conditions are met.
• Businesses that expect future taxable activity above the threshold should remain registered.

Practical Example

A small trading company that reduced its operations applies for voluntary VAT deregistration after its taxable sales fall to AED 150,000 in the past year.

Why It Matters

Voluntary deregistration helps businesses avoid unnecessary administrative work and tax filing when their turnover drops below the VAT threshold.