TaxSavvyAE

Changing a partner before renewal

One partner is leaving the company. Should I change the licence before renewing?

The situation

A change of shareholder needs an amended memorandum and licence, and an update of the beneficial owner register. Doing it before renewal avoids renewing with wrong data.

The law

  • Cabinet Resolution 109 of 2023: Beneficial owner data must be kept accurate and updated with the registrar
  • Cabinet Decision 132 of 2023: Fines for failing to keep or update beneficial owner data

What it means for you

Sign the share transfer, amend the memorandum, update the licence and file the new beneficial owner data. For Corporate Tax, a change of ownership above 50 percent can affect the use of carried-forward tax losses. Example: if the leaving partner holds 60 percent, check the loss continuity rules before signing. Also update bank mandates.

What to do

  1. Sign the share transfer documents.
  2. Amend memorandum and licence on the portal.
  3. Update the beneficial owner register.
  4. Check Corporate Tax loss continuity and update the bank.

We can do this for youTrade licence renewal for mainland and free zone companies: Ejari, UBO, audit and tax checks before renewal: AED 1,200

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