Question Company Liquidation vs Deregistration

[turtle]

Hello,
I plan to close one of my freezone companies in UAE. I contacted FZ and they told me that I could easily dissolve/cancel the company license without liquidation. It is a much more straightforward and affordable option than the liquidation process, but is there any catch?

P.S.: Company made profits in 2020, 2021 and 2022 but now it is almost dormant. It has a small amount of assets(cash), no debts, no employees and a single shareholder.

 

[Sols]

Dissolving properly is the preferred way, especially if there are multiples parties involved (other shareholders or directors), if the company has liabilities or receivables, or if the company has assets that you will claim personally. Without a proper dissolution, you may run into issues with these types of things. If a bank or tax authority in the future asks you for source of wealth, having an abandoned company as opposed to a company which was cleanly and properly liquidate can be a problem.

If that doesn't concern you and if the company indeed is dormant, has little to no assets, no debts, and no employees, you can quite safely just abandon it.

 

[turtle]

 

[Sols]