Trade License Renewal UAE: Why It’s Essential for Your Business?
A trade license is the most crucial license to carry on business in the UAE. A trade license is a legal document for conducting business in the UAE. It ensures that the business is operating within the laws and guidelines of the government. Trade licenses are generally valid for a period of one or two years. Up on expiration, the trade licenses must be renewed. In our blog today we explore why the renewal of a trade license should not be missed.
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Avoid penalties:
In the UAE, strict penalties are levied for businesses operating with expired trade licenses. Penalties and fines can be accumulated to a bigger amount depending on the delay. These unnecessary expenses can be avoided by being compliant with the trade license.
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Maintain business reputation:
A trade license that is expired could lead to seizure of the bank accounts. This could lead to a bad reputation among their customers and vendors.
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Maintain credibility:
A valid trade license increases credibility amongst the stakeholders. This enhances trust and professionalism. An expired trade license can harm the reputation of the business, as every stakeholder would like to deal with an entity complying with all the Government laws and regulations.
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Sustain competitiveness:
The UAE is known for small and medium-scale entities, which has increased the competition amongst the businesses. To stay relevant and gain a competitive advantage, complying with all the legal requirements is a must.
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Failure to renew Visa and labour card:
A valid trade license is required for renewal of the employees’ visas and labour permits. Non-renewal of trade licenses poses difficulties in the issuance of visas and labour permits to employees. As employees are an integral part of any business, this could hamper the continuity of the business.
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Adhere to Legal compliance:
The trade license is an important document required for VAT registration and shall be updated in the Federal Tax Authority (FTA) portal. Failure to renew the trade license could pose a challenge for any amendment in the corporate tax and VAT registrations. Authorities may blacklist the company, which will disrupt the continuity of the business.
How to Renew Your Trade License in the UAE?
- Keep the mandatory documents, such as the tenancy contract (Ejari), passport copies of all the partners, and existing trade license, ready.
- Once these documents are ready, approach your free zone or Department of Economic Development to renew the license.
- The majority of the regulatory authorities have an online portal to apply for the renewal.
- Up on approval, you will receive the renewed trade license.
Bottomline:
We, at BCL Globiz, provide accounting and bookkeeping services, payroll services, corporate tax advisory services, business advisory services, and many more under one roof at affordable prices. Our team of experts help you identify the crucial points while your focus is on operating your business.
For more information, you can contact our experts at punith@bclglobiz.com.
Also read:
- Ensure seamless corporate tax registration alongside your trade license renewal.
- Master VAT-compliant invoicing as part of maintaining a valid trade license in the UAE.
- Understand the latest VAT tax rates in UAE to stay compliant with trade requirements.
