Below are the standard steps followed for company liquidation in Dubai and the UAE:

Key Steps in Liquidating a Company in Dubai

1. Shareholders must pass a resolution to wind up the company
2. A liquidator (a licensed audit firm) is appointed to conduct the liquidation
3. Liquidator presents acceptance letter
4. Get resolution notarized from the  notary public
5. Submit the documents to the relevant mainland, free zone or offshore Authority
6. Publish a notice of liquidation in a local newspaper
7. Clearance from Immigration (all visas must be cancelled)
8. Clearance from Labour department
9. Clearance form Customs
10. Obtain bank account closure letter
11. Obtain clearance from RTA, Electricity & water authority, Etisalat etc.
12. Submit the final Liquidation report along with the clearance letters
13. The licensing Authority issues a cancellation certificate and removes the company from the Register

Conditions for Submitting Board Resolution

In case the shareholders are not physically present in the UAE, the resolution / Power of Attorney can be notarised and attested from the UAE embassy of the country of origin of the shareholders. It has to be attested and legalized by the Ministry of Foreign Affairs and Ministry of Justice in the UAE. The resolution must also state the name and complete address of the liquidator. However, these steps are not applicable in the case of liquidating a sole establishment in Dubai. These formalities apply to most company liquidation cases in the UAE, except for sole establishments.

Special Compliance Requirements

Companies going through company liquidation in Dubai or the UAE must also fulfil a number of additional compliance requirements to complete their winding-up process smoothly.In addition to the standard procedures, companies must assess their status whether or not they qualify to meet other compliance requirements such as:

De-registration of Value Added Tax

If a company has registered for Value Added Tax (VAT), it becomes eligible for de-registration once the liquidation procedure starts. However, many business owners forget to apply for de-registration while liquidating a company in Dubai. As per Article (14) of VAT Executive Regulations, a VAT registered company must apply for VAT de-registration within 20 business days of becoming eligible. If a company under liquidation fails to apply for VAT de-registration within the stipulated time, a penalty of AED 10,000 will be incurred. VAT de-registration is a time-consuming process, and therefore, the business owners need to prioritize this mandatory requirement while developing their exit strategy. Timely VAT de-registration is a mandatory step in company liquidation in the UAE.

Maintaining Real Beneficiary Register

A company under liquidation is obliged to meet the requirements set out in the Ultimate Beneficial Ownership (UBO) law. As per Cabinet Resolution No. (58) of 2020 on Ultimate Beneficial Ownership, a company undergoing liquidation should hand over the Real Beneficiary Register and Partners and Shareholders Register, if any, or a true copy to the Registrar within thirty days from the date of the liquidator’s appointment.

Further, the company administrators or the liquidator must maintain the Registers for a period of at least five years from the date of liquidation. In the wake of the new regulations, the liquidator assumes a greater role here and therefore availing reliable company liquidation services in Dubai becomes imperative.

Liquidators must ensure all UBO records are correctly submitted as part of the company liquidation process in Dubai.

ESR Notification, Report Filing Before Liquidation

With the introduction of Economic Substance Regulation (ESR), the compliance burden of companies under liquidation has increased. If a company is carrying out any Relevant Activity during the course of the winding-up process, the liquidator should ensure that the firm meets all relevant ESR obligations.  The company must file ESR annual ESR notification, submit ESR Reports and should meet the Economic Substance Test for any period during which it carries on a Relevant Activity and derives Relevant Income. As non-compliance will result in penalties, it is better to consult with approved company liquidators in the UAE well in advance. ESR compliance is a critical requirement for businesses undergoing company liquidation in the UAE.

The Best Company Liquidation Services in Dubai

Company liquidation in Dubai is a structured process involving several legal and regulatory steps. With additional compliance requirements such as ESR and UBO, the winding-up procedure has become more complex. Partnering with reliable company liquidation services in Dubai and the UAE, such as Jitendra Business Consultants (JBC), helps investors close their companies smoothly. JBC manages the entire process — visa cancellations, ESR filing, VAT de-registration, UBO documentation, bank account closure, and complete liquidation reporting.