How to Liquidate Mainland Companies in Dubai?
No matter what type of business you own, you must follow certain steps and requirements to liquidate your company in Dubai. Voluntary liquidation of a Dubai Mainland Limited Liability Company (LLC) can be tricky and complex due to the extensive steps and regulatory requirements associated with it. For example, you may need to navigate requirements related to Value Added Tax (VAT), Corporate Tax, Economic Substance Regulations (ESR), and Ultimate Beneficial Ownership (UBO) while undertaking company liquidation in Dubai.
A company that has not planned an exit strategy will struggle while closing down its business operations in Dubai. Voluntary company liquidation is the best available exit strategy for business owners as it allows them to close down their operations legally and peacefully. Having the best company liquidators in Dubai by your side is also key to making your exit smooth. Here is a list of key steps and requirements you must meet to liquidate a Dubai mainland LLC:
Prepare a Board Resolution
The shareholders of the company should pass a board resolution approving the liquidation of the LLC in Dubai mainland. The board resolution must be notarized by the Notary Public and submitted to the Department of Economic Development (DED). The resolution must be signed by all the shareholders before notarizing.
Appoint a Company Liquidator
An official liquidator must be appointed to carry out the process of liquidation. The name and address of the liquidator must be stated in the board resolution submitted to the DED. The liquidator can be an audit firm licensed to carry out its operations in the UAE. The liquidation process can be completed faster if you appoint experienced company liquidators in Dubai.
Letter of Acceptance from Liquidator
The liquidator must send a letter to the DED accepting his role as the company’s official liquidator. The DED will also demand the liquidator’s documents such as a copy of the license, the accountant’s registration certificate, a signature specimen notarized by a notary public etc.
Advertisement in Newspaper
An advertisement about the company’s liquidation must be published in two Arabic newspapers for one day. However, the creditors will be given a grace period of 45 days following the advertisement date to submit their requests. Company liquidators in Dubai are typically responsible for carrying out newspaper advertisements.
Cancellation of Visa and Establishment Card
All the visas must be cancelled, including the employees’ resident visas on the license. The company’s establishment card needs to be cancelled as well.
Bank Account Cancellation
The bank account of the LLC must be cancelled before winding up the company. A closure letter from the bank must be obtained and submitted to the DED.
Clearance from Authorities
Clearances must be obtained from Dubai Customs, DEWA, and Etisalat/Du to successfully close down an LLC in Dubai mainland.
VAT and Corporate Tax Deregistration
LLCs with an active VAT and corporate tax registration must apply for deregistration.
Economic Substance Regulations Compliance
Shareholders of a liquidating LLC in Dubai must check their ESR compliance status. If the company has conducted any of the nine relevant activities, ESR obligations apply ( filing ESR Notification, submitting ESR Report and meeting Economic Substance Test).
Compliance with Ultimate Beneficial Ownership
An LLC winding up its operations in Dubai is liable to meet the obligations stipulated under Cabinet Decision No. (58) of 2020 on Ultimate Beneficial Ownership (UBO). As per the Decision, companies undergoing liquidation in the UAE are required to hand over the Real Beneficiary Register (RBR) and Partners or Shareholders Register (PSR) to the licensing authority. The liquidator or administrator must also maintain the RBR and PSR for at least five years from the date of liquidation.
Submission of Liquidation Report
The process of voluntary LLC liquidation in Dubai will come to a close when the liquidator submits the final Liquidation Report. The Dubai Mainland LLC will be deregistered after the DED receives the liquidation report. Avail of the best company liquidation services in Dubai to complete the liquidation process without any delay.
Hire the Best Company Liquidators in Dubai
Closing down an LLC in Dubai requires the help of experienced company liquidators who can help you shut down the company in line with all the mandatory steps and procedures. Jitendra Chartered Accountants (JCA) is one of the best company liquidators in Dubai with over two decades of experience. JCA can help you liquidate all types of companies such as free zone companies, offshore companies and mainland companies. If you are looking for the best company liquidation services in Dubai, look no further than JCA.