How Can a Member Be Removed from a Tax Group?

The tax system in the UAE plays a big role in helping businesses and individuals. It was introduced by the Federal Government to raise the standard of living and support better services. VAT group registration is when two or more companies apply together as one taxable person. A business can register under a VAT tax group if there’s common ownership and control. One member becomes the representative of the group. This representative handles VAT returns and payments. Still, all members share equal responsibility for VAT debts and reports.

If a member is no longer eligible, then the representative must notify the FTA within 20 days. Supplies made inside the group don’t need VAT accounting. This system makes VAT easier and helps companies focus on growth.

🥇 VAT Group Registration

VAT group registration allows multiple entities to be treated as one. To qualify, certain conditions must be met:

• Every member should have a fixed place of establishment in the UAE.
• The group must have enough staff and technology to perform supply activities.
• The group gets one VAT license number in the representative member’s name.
• The group must use one consolidated accounting system.
• All members remain equally liable for VAT debts.
• The representative submits consolidated VAT payments and returns.

This structure simplifies compliance and ensures businesses avoid confusion with VAT reporting.

🥇 Advantages of VAT Group Registration

VAT group registration offers several benefits for businesses:

• All entities in the group are treated as one taxable entity.
• VAT compliance becomes simpler with one return submission.
• Supplies within the group aren’t taxed under VAT.
• VAT applies only when supplies are made outside the group.
• It reduces administrative costs and time for businesses.

This helps companies focus on their operations without worrying about unnecessary VAT charges.

🥇 Amendment and Removal of a Tax Group Member

When a company joins a VAT group, changes can happen later. These may include:

• Adding a new member to the existing group.
• Removing a member from the group.
• Changing the representative member.
• Disbanding the entire VAT group.

A member can be removed if:

1. The company stops taxable supplies and goes into liquidation.
2. The ownership of a member changes.
3. The business fails to meet group requirements.
4. The companies no longer share financial ties.
5. The FTA foresees tax evasion risk.

🥇 Removal of a Member from a VAT Group

When removal is needed, the representative member must notify the FTA.

• The notification must be sent within 20 business days.
• The FTA will review and issue a decision.
• The group gets a new TRN (Tax Registration Number) if amended.
• The removed member’s old TRN will be reactivated.

This ensures proper compliance with UAE VAT rules.

🥇 Removal of a Representative Member

If the representative member is removed, the FTA process is slightly different:

1. Access the FTA web portal.
2. Select “Change representative member”.
3. Fill in the amendment application.
4. Submit the request to FTA.
5. Receive approval notification after review.

This process ensures a smooth transition for the group.

🥇 Deregistration Procedures

VAT deregistration happens online through the FTA portal. A business must deregister when:

• It closes down and submits a liquidation letter.
• Its taxable supplies fall below the threshold within 12 months.
• It can’t meet VAT obligations.

Steps for deregistration:

• Submit an application online.
• FTA reviews the request.
• If approved, status changes to “Pre-Approved”.
• File a final VAT return.
• Clear all outstanding liabilities.

If deregistration isn’t filed on time, penalties apply.

🥇 Penalties for Non-Compliance

Failure to submit VAT deregistration on time results in a penalty of AED 10,000 under Cabinet Resolution No. 40 of 2017. Businesses must comply to avoid such fines.

🥇 Why Choose Mubarak Al Ketbi (MAK) Auditing?

Mubarak Al Ketbi (MAK) Auditing provides expert VAT deregistration services across UAE. The team understands VAT law and makes the process smooth. Services include:

• VAT training.
• VAT registration.
• VAT deregistration.
• VAT compliance & filing.
• VAT payment assistance.
• VAT impact assessment on cash flow.

Apart from VAT services, MAK Auditing also provides:

• Auditing services.
• Accounting & bookkeeping.
• Payroll management.
• CFO advisory.
• Accounting software setup.

This expertise ensures complete financial support for every business.

🥇 What Can Help You — Mubarak Al Ketbi (MAK) Auditing

Running a business in UAE needs the right financial partner. Mubarak Al Ketbi (MAK) Auditing guides you with VAT registration, deregistration, compliance, and more. With expert knowledge and professional service, your company stays safe from penalties and risks. When it comes to financial solutions, MAK Auditing proves that “the ball is in your court” to make the right choice.

For more information:

• Visit our office: Saraya Avenue Building – Office M-06, Block/A, Al Garhoud – Dubai – United Arab Emirates
• Contact/WhatsApp: +971 50 276 2132