The UAE offers unrivalled tax planning opportunities to international businesses, zero corporate and income taxes for most activities, an impressive network of double tax treaties, no withholding tax on dividends and interest paid and no levy on capital gains. It is an established International Financial Centre ranked amongst the top 20 countries in the world for competitiveness.
Special Economic zones, free zones, and UAE offshore companies offer 100 percent ownership, repatriation of profit and capital as well as exemption from taxes. Outside of these areas, significant incentives are being offered to investors and corporate governance provisions ensuring transparency and accountability. Corporate taxes are reserved only for branches of foreign banks and oil producers. A mere five percent tariff is imposed on goods imported from non-GCC countries.
The UAE is a white listed onshore jurisdiction that offers offshore jurisdictional services while offering opportunities of a mature industrial and financial hub.
Under UAE federal law, foreign businesses have three main entities to choose from in order to conduct businesses in the UAE: a local limited liability company (“LLC “ ), a free zone entity (“FZE”) and an international business company (“IBC”). Companies can also operate by setting up a branch of a foreign company, a representative office of a foreign company, a private or public joint stock company and a general partnership.
A LLC can be formed with a minimum of 2 and a maximum of 50 individuals whose liability is limited to their shares in the company’s capital. Companies with expatriate partners typically opt for this form of company. The voting rights in the company may not exceed 49 percent profit and loss distribution, and the share in allocation of liuidation proceeds can be mutually agreed upon. LLCs can sell directly to the local market. The main advantages of setting up in one of the free zones in the UAE are :
If there is no need to sell goods directly to the UAE market, but offce space and local staff are required, then setting up in a free zone is often more attractive than using a local company. Free zone companies also meet the growing necessity in international tax planning of having necessary substance. The main advantages of setting up in one of the free zones in the UAE are as follows:
Dubai, through Jebel Ali Free Zone, and Ras Al Khaimah, through the RAKIA Free Zone and the RAK Free Trade Zone ,offer an International Business Company ( IBC) regime. These companies are ideal for any type of business that does not require a local office. this includes any passive investment activity eg: Holding shares in local or free zone companies, holding UAE real estate , or trading activities outside the UAE. RAK IBCs have the following :
Partners in a general partnership can only be UAE nationals. Each partner is jointly and severally liable for all liabilities of the partnership
Our corporate consultants will undertake the review of your proposed structure, proceed with the incorporation with the incorporation of the entities whilst complying with the applicable legislation and best corporate practice. We assist in registering companies in Dubai and the UAE local limited liability company (“LLC “ ) , Free zone entity ( “ FZE”) and International Business Company (“ IBC”)
Our firm can also provide full range of corporate administration services in UAE :
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