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- Call us: +971 55 441 1036
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- Call us: +971 55 441 1036
- Mail US : info@dawnconsultancy.com
- ADD US : dawn.consultancy
Closing a free zone company should be straightforward, but many owners discover months later that their company was never properly deregistered, or that penalties have been building up in the meantime. These are the six mistakes we see most often.
1. Letting the licence expire instead of liquidating
An expired licence does not close a company. It continues to exist on the free zone register, and renewal charges, late fees and penalties can accumulate. A company must go through a formal liquidation and deregistration process.
2. Forgetting Corporate Tax deregistration
A company that ceases business must apply to deregister for Corporate Tax within three months of ceasing, and file its final return. Failing to deregister can lead to administrative penalties.
3. Forgetting VAT deregistration
VAT-registered businesses that stop making taxable supplies must apply to deregister within 20 business days, after filing all outstanding returns and settling any tax due.
4. Starting without complete records
Most free zones require audited accounts up to the liquidation date and a liquidator’s report confirming liabilities have been settled. Missing bookkeeping can delay the process by months. Bring the books up to date first.
5. Leaving visas, leases and bank accounts open
Employee visas must be cancelled, lease obligations settled and bank accounts closed. Each can block the final deregistration certificate if left open.
6. Underestimating paperwork for overseas owners
Where shareholders live abroad, resolutions and powers of attorney often need notarisation and legalisation before the free zone will accept them. Starting this early avoids long delays.
How Dawn Consultancy can help
We act as liquidator for free zone companies and handle audit, tax deregistration and submissions to the authority. See our free zone liquidation and company liquidation services.
Planning to close a company? Call +971 55 441 1036, email info@dawnconsultancy.com or contact us.
This article is for general information and reflects the rules in force at the date of publication. It is not tax, legal or audit advice. Confirm the position for your business before acting.