Business Setup

VAT Registration and Deregistration in the UAE: A Complete Guide

Published 05 Jul 2026 · Updated 12 Aug 2026 · 2 min read · By UAE Info Portal Editorial Team, Editorial Team

Reviewed by UAE Info Portal Editorial Team, Editorial Team

Key Takeaways

Mandatory registration once taxable turnover exceeds AED 375,000 over a rolling 12 months.
Voluntary registration available above AED 187,500 — useful to reclaim input VAT early.
Deregistration is required if turnover falls below AED 187,500 or the business ceases taxable supplies.
Continuing VAT registration after falling below the threshold is now itself a compliance issue.
VAT and corporate tax deregistration are separate but need to be coordinated together.

VAT registration in the UAE is required once a business's taxable supplies cross a defined threshold, and understanding both when registration becomes mandatory and how deregistration works later (if a business closes or falls below the threshold) matters for staying compliant with the Federal Tax Authority (FTA) throughout a company's lifecycle.

Registration becomes mandatory once a business's taxable turnover exceeds AED 375,000 over a rolling 12-month period, while voluntary registration is available once turnover exceeds AED 187,500, useful for newer businesses that want to reclaim input VAT on expenses even before they're legally required to register. Registration is completed through the FTA's EmaraTax portal, and once approved, the business receives a Tax Registration Number (TRN), which needs to be referenced on invoices and is increasingly treated by banks and business partners as a basic marker of legitimacy, beyond just its tax function.

Deregistration works in the reverse direction: it's required if a business's taxable turnover falls below the AED 187,500 threshold, if the business ceases making taxable supplies entirely, or if it closes down or undergoes a structural change like a merger. Continuing to hold VAT registration after falling below the threshold is now treated as a compliance issue in its own right, not simply an optional continuation, so businesses whose revenue has genuinely declined need to actively apply for deregistration rather than assuming inactivity resolves the matter on its own.

A detail worth understanding clearly: VAT deregistration and corporate tax deregistration are separate processes but need to be coordinated together, since VAT cessation typically triggers corporate tax filing obligations for the final tax period, and any mismatch between the two filings (different cessation dates, inconsistent financial reporting) can trigger cross-tax reconciliation checks and delay the deregistration process. Given how the FTA has moved toward increasingly digital, data-driven reconciliation between VAT and corporate tax records, businesses going through deregistration for any reason are generally well served by ensuring both processes are handled together and consistently rather than treating them as entirely separate administrative tasks.

Step-by-Step Process

1
Register via EmaraTax
Once turnover crosses AED 375,000 (mandatory) or AED 187,500 (voluntary).
2
Receive Tax Registration Number (TRN)
Referenced on all invoices.
3
Apply for deregistration when applicable
If turnover falls below AED 187,500 or business ceases.

Estimated Costs

Item	Amount	Notes
Mandatory registration threshold	AED 375,000 taxable turnover (12-month rolling)
Voluntary registration threshold	AED 187,500

Fees and thresholds change periodically — confirm current figures with the relevant authority before relying on them.

Frequently Asked Questions

At what turnover level is VAT registration mandatory in the UAE?

Registration becomes mandatory once a business's taxable turnover exceeds AED 375,000 over a rolling 12-month period, while voluntary registration is available from AED 187,500.

Why would a business register for VAT voluntarily before it's required to?

Voluntary registration allows a newer business to reclaim input VAT on its expenses even before crossing the mandatory threshold, which can be financially useful during a growth phase.

When is VAT deregistration required?

It's required if a business's taxable turnover falls below AED 187,500, if it stops making taxable supplies entirely, or if it closes down or undergoes a structural change like a merger.

Are VAT deregistration and corporate tax deregistration the same process?

No, they're separate processes, but they need to be coordinated together since VAT cessation typically triggers corporate tax filing obligations for the final tax period.

What happens if VAT and corporate tax deregistration dates don't match?

A mismatch between cessation dates or inconsistent financial reporting across the two filings can trigger cross-tax reconciliation checks and delay the overall deregistration process.

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