Are you looking to shut down your Dubai business? If that’s your goal, you should first choose trade licence degeneration in Dubai. It’s critical that you promptly cancel your trade licence. Because if you don’t, the government will require you to pay fines and penalties.
Prospr wants you to avoid paying needless fines and costs, which is why we are here to advise you on the most crucial issue:
How can a sole proprietorship in Dubai cancel trade licence?
Depending on your business, the process of Dubai trade licence cancellation or degeneration may vary. If you are the sole proprietor or operator of a civil company, you are fortunate, as the entire process is straightforward.
It would help if you had clearance from the relevant government department before beginning the license cancellation process.
- Dubai Electricity and Water
- Ministry of Human Resources and Emiratization
- Directorate of Residency and Foreigners Affairs
- Department of Immigration
- Labour Department Ministry
After obtaining all the clearances, you should apply for a trade license cancellation at DED. You must close your Dubai corporate bank account and end your office tenancy.
How to cancel the trade license of a shareholding company? Detailed guide
If you intend to close the business of your shareholder company, it’s critical to settle all of your liabilities to creditors and partners. The goal is to safeguard your interests and share. For a shareholder company, the process of canceling a trade license is complicated since you need to sell the shares, pay the debts, and take care of all liabilities before you can apply with DED.
Companies need to hire a liquidator. The following companies need to appoint a qualified liquidator:
- LLC
- General Partnership
- Simple Limited Partnership
- Public Joint Stock Corporation
- Private Joint Stock Corporation
You need to provide notarized minutes of the general assembly to prove that the company is ending business and has appointed a liquidator.
- Approval is required to cancel a private shareholding company.
- You will need Ministry of Economy approval.
- Approval is required to cancel a public shareholder company.
- The Securities and Commodities Authority’s decision is what you need approval for.
Trade license cancellation process
You must take two steps to cancel your trade license if you have a liquidator.
Step 1 of the Trade Licence Cancellation Process
- Present a formal letter from a licensed liquidator. This letter certifies that a qualified individual has been responsible for liquidating your company.
- You will receive a liquidation certificate once you fill out the form at DED.
- This notification of company liquidation must be published in two local newspapers, as required. Debtors may submit their claims (if any) within a grace period of 45 days following the notification issuance date.
Step 2:
- Provide a letter of declaration from the partners and liquidators. This letter certifies that no additional parties have objected within the grace period. Send DED this letter.
- To cancel your company’s trade licence in Dubai, obtain the required approval from the relevant authorities.
- You need to cancel all foreign partner visas sponsored by your company at the appropriate General Directorate of Residency & Foreigners Affairs. You must also go to the Ministry of Human Resources and Emiratization to cancel the firm card.
- The required document must be submitted to DED
- DED will decide on the trade licence cancellation fee.
- Upon payment of the trade license cancellation cost, you will receive the certificate of deregistration (cancellation).
You should be aware that a company’s branches created in other emirates will likewise be dissolved if the company is dissolved in one emirate.
Also read about: Different types of trade licenses in Dubai
What is required to cancel a sole proprietorship licence?
You will need the following paperwork to cancel your licence as a sole proprietor.
- A letter from the Ministry of Human Resources and Emiratization expressing no objections
- to evidence of an expat’s residence cancellation.
Can I freeze my trade license in Dubai?
Indeed, you can freeze your trade licence in Dubai for up to three years. During that period, you will have to pay a freezing licence fee. However, the freeze on your licence won’t last much longer. For a Dubai Freezing Trade Licence, you must fulfil the following requirements:
- You need to furnish a letter from your company requesting to temporarily revoke the licence.
- You must then provide a letter from the Ministry of Emiratization and Human Resources. According to this letter, the individuals listed on the sponsored licenses are absent. In addition, a report from the DED inspection division will be provided by you.
What is the trade licence cancellation fee in Dubai?
AED 3520 is the total cost of the trade licence cancellation fee. The cost breakdown is as follows:
- AED 500 is the licence cancellation fee.
- Cancellation Announcement Fee: AED 500
- Knowledge Dirham Fee: AED 10
- Innovation Dirham Fee: AED 10
- AED 2,000 is the company dissolution fee.
- The cost to deregister a business company is AED 500.
How long does it take to cancel a trade licence in Dubai?
The license cancellation process takes 40–60 days, except for holidays. When renewal is near, it’s a good idea to consider whether to renew or cancel your trade license.
You will be responsible for paying the penalty and fee, so you cannot expect to cancel the license at the last minute. Why? You will, however, have a grace period of one month to renew your license. If the licence renewal deadline has passed and your licence is canceled. The government will deduct fines and penalties from your income in addition to cancellation fees.
To avoid the fines and penalties associated with a late renewal of a trade license in Dubai, you must cancel it at least three months before its expiration date.
Do you want to shut down business in Dubai? Prospr PRO services are available for you.
Although canceling your trade license in Dubai is difficult, Prospr’s Pro services are always available to make the process go smoothly. Our PRO staff is here to assist you with any approval or document that you may need. Give me a call now.
