Company Liquidation Services in UAE

The shareholders normally approve the decision to close the company. The resolution may cover:

• Decision to liquidate
• Appointment of liquidator
• Authority given to the liquidator
• Company representative
• Closure instructions
  

  The required format depends on the licensing authority and company structure.

Where the authority requires a liquidator, the company appoints an eligible liquidator. The liquidator then handles the formal winding-up work. This can include:

• Reviewing company records
• Identifying liabilities
• Checking assets
• Preparing required reports
• Dealing with creditors
• Supporting authority submissions
• Completing the final liquidation process

A liquidation report or auditor's report may be required by the licensing authority. The report can cover:

• Company assets
• Company liabilities
• Financial position
• Outstanding obligations
• Final accounts
• Status of creditors
• Settlement position

The exact report and format depend on the authority.

Some authorities require a public notice during the liquidation process.
The purpose is to give creditors an opportunity to raise claims.
Do not assume that the same advertisement period applies to every UAE company. The rules are authority-specific.
For example, JAFZA's current company termination guidance sets out its own documents, clearances and processing requirements.

Before final company closure, employee-related matters should be completed. This may include:

• Salary settlement
• Employee cancellation
• Work permit cancellation
• Visa cancellation
• Establishment card matters
• Labour-related clearances

If employees remain active, the company may not be ready for final closure.

Depending on the company, clearances may be needed from:

• Licensing authority
• Immigration
• Labour authorities
• FTA
• Customs
• Utilities
• Telecommunications providers
• Landlord or free zone
• Other government departments

For example, JAFZA's published termination procedure specifically refers to financial, RTA, visa, DEWA, customs and Etisalat clearances where applicable.

The company bank account should normally be closed after:

• Outstanding payments are settled
• Customer receipts are collected
• Supplier payments are completed
• Tax obligations are addressed
• Final balances are dealt with

Keep the final bank statement and closure confirmation with the company's records.

If the company is VAT registered, VAT deregistration may be required.

The Federal Tax Authority currently provides VAT deregistration through EmaraTax. The FTA states that, where deregistration is mandatory, the application must generally be submitted within 20 business days from the date the deregistration obligation starts.

The final VAT return and tax payment are also important.

The FTA states that the final VAT return and payable VAT should be submitted and settled no later than 28 days from the effective deregistration date.

Company liquidation does not automatically remove Corporate Tax obligations.

If the company is registered for Corporate Tax, its tax position must be reviewed and the appropriate deregistration process completed.

The FTA's Corporate Tax deregistration service covers cessation of business and other qualifying circumstances. The service is submitted through EmaraTax.

The FTA currently states that the estimated processing time for a completed Corporate Tax deregistration application is 30 business days, although additional information can extend the process.

This is why tax closure should be planned as part of the liquidation process rather than left until the final day.

Once the required financial, tax and government matters are completed, the company submits the final documents to the relevant authority.

The authority may request:

• Liquidation report
• Liquidator documents
• Shareholder resolution
• Clearances
• Tax documents
• Lease cancellation
• Visa cancellation
• Final financial statements
• Other authority-specific documents

The final stage is cancellation of the company's licence and completion of the company's registration closure.

The company should retain evidence of:

• Licence cancellation
• Tax deregistration
• Liquidation report
• Authority closure
• Bank closure
• Employee/visa cancellation
• Final accounts

These documents can be important if questions arise later.