Renewing a licence for a dormant company
My company has no business this year. Should I still renew the licence?
The situation
A dormant company still owes renewal fees, Corporate Tax filings and other duties while the licence is active. Cancelling stops new obligations but has its own costs.
The law
- Art 52, Federal Decree-Law 47 of 2022: Deregistration requires all returns filed and taxes paid
What it means for you
Compare the yearly cost of keeping the licence with the one-off cost of closing. Market guides put a simple mainland sole establishment cancellation at about AED 4,500 to 7,500 in total. Example: if renewal costs AED 15,000 a year and you have no plans for 2 years, cancelling may save money. If you will restart soon, renewing keeps the trade name, bank account and visas.
What to do
- Decide whether you will trade in the next 12 months.
- Price renewal against cancellation.
- If renewing, keep filing nil Corporate Tax returns.
- If closing, start deregistration with the FTA first.
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