Transitioning from Dubai

[Remover0707]

Hi everyone, given that Fred has closed the Dubai corporation, and widely popular his service was on this forum - what's everyone's plans with regards to Dubai? And with regards to transitioning and such? (perhaps a new service by someone new, or will we need to contact the free zone directly now)

It seems strange that Fred needs to close simply because of 9% corporate taxation of a subset of businesses. I had thought Dubai was still a good prospect after all even with the taxation on some businesses. Anyone care to give input on that? Anyhow - hopefully Fred is safe, as his disappearance is highly strange.

 

[uranium]

Hi everyone, given that Fred has closed the Dubai corporation, and widely popular his service was on this forum - what's everyone's plans with regards to Dubai? And with regards to transitioning and such?

It seems strange that Fred needs to close simply because of 9% corporate taxation of a subset of businesses. I had thought Dubai was still a good prospect after all even with the taxation on some businesses. Anyone care to give input on that?

Everyone is stuck at this point. Everyday someone will come and ask same question. Where to go ?
It seems that even if you are going to run offshore company while living in dubai, you still have to pay taxes.
So what is needed now; offshore jurisdiction where you can get: visa, company, business bank account, personal account, tax free. Straight forward process just like dubai.
Let's vote for next destination!

 

[Remover0707]

Everyone is stuck at this point. Everyday someone will come and ask same question. Where to go ?
It seems that even if you are going to run offshore company while living in dubai, you still have to pay taxes.
So what is needed now; offshore jurisdiction where you can get: visa, company, business bank account, personal account, tax free. Straight forward process just like dubai.
Let's vote for next destination!

I just figured that a small 9% tax on a small % of businesses would be still worthwhile to keep the Dubai option.

 

[uranium]

I just figured that a small 9% tax on a small % of businesses would be still worthwhile to keep the Dubai option.

No way!
UAE on Fatf Grey list + 9% taxes !!!
Absolutely not worth it!

 

[Fred]

Hi everyone, given that Fred has closed the Dubai corporation, and widely popular his service was on this forum - what's everyone's plans with regards to Dubai? And with regards to transitioning and such? (perhaps a new service by someone new, or will we need to contact the free zone directly now)

It seems strange that Fred needs to close simply because of 9% corporate taxation of a subset of businesses. I had thought Dubai was still a good prospect after all even with the taxation on some businesses. Anyone care to give input on that? Anyhow - hopefully Fred is safe, as his disappearance is highly strange.

Again I can just repeat myself the reason behind the closing of Business is not the 9% Corporate Tax which is absolutely no issue to handle as a Personal Individual and Business Owner.

However for DLS Dubai this would have required to hire at least 5 more people to run the show for so many clients Accounting/ Bookkeeping and in addition to this fighting with the truth against so many other Dubai Corporate Service Provider talking bulls**t.

I just figured that a small 9% tax on a small % of businesses would be still worthwhile to keep the Dubai option.

That's how I see it as well and most DLS Dubai Clients and for people like you I remain active as an Independent Consultant.

 

[Larin]

@Fred it would be great to get some recommendations for a trustworthy accountant to do the reporting that will be required.

 

[JustAnotherNomad]

The issues with the UAE are much bigger than 9% tax:
- Unclear rules (seriously, how do people just keep asking and speculating how the tax will be handled, for months!)
- Unexpected fees and fines for everything (e.g. "cancellation fee")
- No limited liability (company can only be closed if you accept all company liability as your own)
- No rule of law

It used to be ok, no tax, nothing to file, live and let live. But I don't understand how anyone could be willing to operate under the new circumstances.

 

[troubled soul]

The issues with the UAE are much bigger than 9% tax:
- Unclear rules (seriously, how do people just keep asking and speculating how the tax will be handled, for months!)

True...You can lose sleep over this....end of the day It is sharia country...95% of government staffs are unqualified and lazy for serious tax matter....They will give your hard time.
UAE is not small Island or some city state..
Even with oil money You can not run country of 9.2 million people tax free.....Government need money...Cost or running New York level city in desert cost huge money...There is no natural fresh water source....Inside everybody know this was coming.....UAE is dead for "total tax free business operation"..

It is still too early to say what the long-term impact of these changes will be. However, it is clear that the UAE is moving away from its traditional tax-free status. This is likely to have a significant impact on the business landscape in the country.

Cayman enterprise city, Estonia and HK company are Good alternative to Dubai as of today

 

[uranium]

True...You can lose sleep over this....end of the day It is sharia country...95% of government staffs are unqualified and lazy for serious tax matter....They will give your hard time.
UAE is not small Island or some city state..
Even with oil money You can not run country of 9.2 million people tax free.....Government need money...Cost or running New York level city in desert cost huge money...There is no natural fresh water source....Inside everybody know this was coming.....UAE is dead for "total tax free business operation"..

It is still too early to say what the long-term impact of these changes will be. However, it is clear that the UAE is moving away from its traditional tax-free status. This is likely to have a significant impact on the business landscape in the country.

Cayman enterprise city, Estonia and HK company are Good alternative to Dubai as of today

Estonia tax free ?

 

[troubled soul]

Estonia tax free ?

CIT 0%
WT 20%

 

[uranium]

CIT 0%
WT 20%

WT only from salary?

 

[Don]

WT only from salary?

Non resident salary is 0% for work performed outside Estonia, but profit distributions are 20%, unless profits are redistributed from foreign PE or subsidiary (participation exemption), which are exempt from tax.

 

[troubled soul]

Use Estonia company as a piggy bank..

 

[uranium]

Use Estonia company as a piggy bank..

profit distributions are 20%, means I pay 20% from my profits?

 

[troubled soul]

profit distributions are 20%, means I pay 20% from my profits?

When you pay yourself as a dividend than and than 20% tax apply...
Like
If your company make 500k USD profit and It is in bank account under Company name...there is not tax here...
You can pay yourself 5k USD salary per month as non resident director....5k*12=60k USD tax free......(You can pay yourself any reasonable amount of salary tax free )

Now If you want more money from company like You want more 60k as dividend ..You have to pay 20% on this dividend

P.S. I am not expert.. Take legal help before taking any steps

 

[Fred]

@Fred it would be great to get some recommendations for a trustworthy accountant to do the reporting that will be required.

Just reach out directly to the Authority which overtook all DLS Dubai Employees so you get the DLS Dubai Experience except my Personal Pointers and Consultation which is anyway no really possible to get from an Employee and was what made DLS Dubai really great.

For a small circlle of DLS Dubai Clients I know well I remain available as a Paid Consulting and I try to keep the Sponsorhip of the Forum up and running as well.

 

[Billybob69]

When you pay yourself as a dividend than and than 20% tax apply...
Like
If your company make 500k USD profit and It is in bank account under Company name...there is not tax here...
You can pay yourself 5k USD salary per month as non resident director....5k*12=60k USD tax free......(You can pay yourself any reasonable amount of salary tax free )

Now If you want more money from company like You want more 60k as dividend ..You have to pay 20% on this dividend

P.S. I am not expert.. Take legal help before taking any steps

Forgive my ignorance @troubled soul but how would something like that actually work in practice, if you are running an Estonian company to be a non resident do you have to stay out of Estonia? If so where would you have to actually live, somewhere without CFC rules?

 

[troubled soul]

Forgive my ignorance @troubled soul but how would something like that actually work in practice, if you are running an Estonian company to be a non resident do you have to stay out of Estonia? If so where would you have to actually live, somewhere without CFC rules?

I am not expert but Estonia company with E residency is always tax resident of Estonia ......

 

[Don]

I am not expert but Estonia company with E residency is always tax resident of Estonia ......

Yes, and profits arising from a foreign PE that are already taxed will not be taxed again in Estonia.
If the profits from foreign PE are not taxed, they will be taxable on distribution only so can still be reinvested tax free.
Estonia also does not withhold tax on interest paid to non-residents (and even residents in certain cases), so an owners loan with high interest can be one of the ways to extract some money from the company tax free (works well if you are based in UAE).

Similarly Estonia will not tax the directors fee(or similar fee as per DTT) from UAE if you are a tax resident.
A small business in UAE with high directors fee and low margin can potentially be an interesting proposition for Estonian tax residents, especially from 2027 when small business relief will be abolished.

Estonia tax code looks simple, but its often misunderstood as most accountants and advisors often do not realize the possibilities of structuring to optimize tax.

Structuring your operations to leverage the strengths of both the Estonian and UAE tax systems can potentially provide you with significant tax and operational benefits.

As always, specific tax planning strategies should be thoroughly discussed with a professional tax advisor to ensure compliance and effectiveness.

 

[TheCryptoAnt]

what's everyone's plans with regards to Dubai?

Im going back to Thailand, in retrospective.... I shouldve never left