Does anyone have experience with Dubai offshore company formation and usage?

[aceupsleeve]

Im not well researched about the subject because there are many options and its quite confusing finding organized information about all the nuances of each freezone and its up to datw rules without contacting a professional for at least 1h talk. so decided just to ask:

I'm thinking of opening Dubai offshore company for online advertising business. I have no intention or will to visit UAE and im not working with UAE users or customers.

Reason for Dubai is for 0% tax, no accounting, no reporting. Sounds like no headache.

My question is if this is really the case?

1. Is it still 0% corporate tax, dividend tax and any other tax?

2. Does reporting still not required?

3. Is it possible to open the company without visiting or getting a visa there ?

4. Is it possible for such company to open a bank account in UAE?

5. Are the double tax treaties UAE have with other countries relevant to UAE offshore companies?

Your experience and knowledge will really help, thank you .

 

[Helkins]

I’d lean away from the Dubai company and instead look into Fujairah Creative City or RAKEZ, the costs are much lower and if you aren’t planning on having presence or doing business in the UAE it’ll just be a better option for you.

To the best of my knowledge:
1) Yes, I’ve never paid a dime apart from the amendment costs and renewals
2) It depends but currently I believe only FCC doesn’t require any form of filing
3. You can open or buy the company without visiting the UAE but you’d probably have to do it soon, due to COV most of the stuff can be arranged via a video call but normally if not visiting the UAE itself you’d have to pay a visit to one of the freezone branches like RAKEZ in Cologne
4. No UAE bank will open an acccount for you without the visit, signature specimen and identity confirmation have to made made in person, no way around it. I might be wrong but I tried and failed. TransferWise accepts UAE so that could be your temporary choice as they don’t offer cards.
5. I’m not sure what you need it for and I’m not too good in that spectrum so I won’t be answering that to avoid misleading you.

 

[Gediminas]

I would suggest Ajman FZE. No taxes, no accounting, not expensive to maintain, and fast formation.

We can help with that.

 

[aceupsleeve]

I’d lean away from the Dubai company and instead look into Fujairah Creative City or RAKEZ, the costs are much lower and if you aren’t planning on having presence or doing business in the UAE it’ll just be a better option for you.

To the best of my knowledge:
1) Yes, I’ve never paid a dime apart from the amendment costs and renewals
2) It depends but currently I believe only FCC doesn’t require any form of filing
3. You can open or buy the company without visiting the UAE but you’d probably have to do it soon, due to COV most of the stuff can be arranged via a video call but normally if not visiting the UAE itself you’d have to pay a visit to one of the freezone branches like RAKEZ in Cologne
4. No UAE bank will open an acccount for you without the visit, signature specimen and identity confirmation have to made made in person, no way around it. I might be wrong but I tried and failed. TransferWise accepts UAE so that could be your temporary choice as they don’t offer cards.
5. I’m not sure what you need it for and I’m not too good in that spectrum so I won’t be answering that to avoid misleading you.

Thanks for the thorough reply, already a big help hearing from someone who use this.
Can you recommend any company that can consult further and form the company?

 

[AdamT1]

no accounting

I just cant believe there still are some companies formation "advisors" saying such thing as "no accounting required"

Yes it is true that some registering authorities do not require regular annual submission of companies accounts, but it does not mean you dont have to do the accounting for an offshore company. Nor it means that you dont have keep to all the business transaction documents.

It also should be kept in mind that bank or EMI providing account services will definetly ask for company's annual financials as a regular annual KYC procedure of monitoring the client.

 

[Gediminas]

but it does not mean you dont have to do the accounting for an offshore company

Totally agree with this. We always recommend our clients to keep books, otherwise, you can face troubles with financial institutions.

 

[AdamT1]

no accounting

Then why in the pre-sale contact to say "no accounting" and only after the client engages you with money and notion of "all is easy and no accounts" you will "reccomend" that they will definetly need to do the accounts and much more.

 

[Gediminas]

My point was there is no obligation for auditing.

Peace.

 

[AdamT1]

1. Is it still 0% corporate tax, dividend tax and any other tax?

Please note that all this idea will work only if you are a tax resident in low tax country or a country that does not participare in CRS.

If you are a resident of a CRS participant country any bank or EMI of your UAE co will report you to your tax authorities and they get you for your CFC (controlled foreign company).

 

[AdamT1]

4. Is it possible for such company to open a bank account in UAE?

It is so difficult to do for activlly trading entity without you being UAE resident, that the answer is most likelly not.

 

[AdamT1]

5. Are the double tax treaties UAE have with other countries relevant to UAE offshore companies?

UAE offshore IBC companies are non-UAE tax resident entities. UAE double tax treaties are not applicble to this type of IBC co.

 

[aceupsleeve]

UAE offshore IBC companies are non-UAE tax resident entities. UAE double tax treaties are not applicble to this type of IBC co.

Im moving to Portugal applying the none habitual residency tax benifits Which is 0% for income coming only from countries they have double tax treaties with, which one of them happens to be UAE.
And i need to know if it will work with offshore uae company

 

[CaptK]

Im moving to Portugal applying the none habitual residency tax benifits Which is 0% for income coming only from countries they have double tax treaties with, which one of them happens to be UAE.
And i need to know if it will work with offshore uae company

Be careful with the NHR as it states you can not do any business in Portugal or you can't run your company from there.

So you can't actively be doing work as an NHR you are simply supposed to receive dividends or passive income like rent.

UAE offshore IBC companies are non-UAE tax resident entities. UAE double tax treaties are not applicble to this type of IBC co.

I tell everyone this, you would be better to register a mainland LLC and accounting is purely cerimonial. All the benefits of an FZ but the option to do business in the GCC and ease of bank account opening.
As an LLC you can then take advantage of DTA and DTT's . Some countries don't actually differentiate between the 2 types but the tax hungry ones do.

Audit in its true sense is to confirm that all expenditure is within tax acceptance. In other words that you can claim expenses for the business. As there is no tax to be paid a family trip to Disney Land will not be questioned because you have not deprived the government of tax because there is no tax.

Bookeping can be done by yourself and all banks allow you to download a CSV file which clearly shows your income and expenditure.

 

[AdamT1]

i need to know if it will work with offshore uae company

no it will not work. Because of CFC rules.

If your UAE offshore co. will not obtain tax residence somwere else it will be treated as doing business in PT trough you personally.

 

[CaptK]

no it will not work. Because of CFC rules.

If your UAE offshore co. will not obtain tax residence somwere else it will be treated as doing business in PT trough you personally.

It's like using a US LLC or UK LLP. Plus bank account will be a nightmare to open.

 

[aceupsleeve]

no it will not work. Because of CFC rules.

If your UAE offshore co. will not obtain tax residence somwere else it will be treated as doing business in PT trough you personally.

And if it was onshore with some

Be careful with the NHR as it states you can not do any business in Portugal or you can't run your company from there.

So you can't actively be doing work as an NHR you are simply supposed to receive dividends or passive income like rent.


I tell everyone this, you would be better to register a mainland LLC and accounting is purely cerimonial. All the benefits of an FZ but the option to do business in the GCC and ease of bank account opening.
As an LLC you can then take advantage of DTA and DTT's . Some countries don't actually differentiate between the 2 types but the tax hungry ones do.

Audit in its true sense is to confirm that all expenditure is within tax acceptance. In other words that you can claim expenses for the business. As there is no tax to be paid a family trip to Disney Land will not be questioned because you have not deprived the government of tax because there is no tax.

Bookeping can be done by yourself and all banks allow you to download a CSV file which clearly shows your income and expenditure.

Thanks
By mainland you mean onshore? Do you know which freezone will be most cost effective and easiest to open with bank account?
Also does the accounting requires yearly report or something?
furthermore more of the company has residency in uae and i will be in PT actively managing it while the money goes to uae bank on company name and from there to me
Will i enjoy the PT tax benefit?

 

[CaptK]

And if it was onshore with some

Thanks
By mainland you mean onshore? Do you know which freezone will be most cost effective and easiest to open with bank account?
Also does the accounting requires yearly report or something?
furthermore more of the company has residency in uae and i will be in PT actively managing it while the money goes to uae bank on company name and from there to me
Will i enjoy the PT tax benefit?

Yes mainland/onshore.
Mainland requires accounting but its easy to keep the cost down by sending yourself payments in bulk as dividend salary.
To clarify with regards to PTNHR you are not allowed to actively do business in Portugal. So long as you don't have any PT clients and don't get clients to pay you in the PT account. You can not do any work patterning to your business. For example if you are a Software Developer you cant actively work on projects whilst in PT. How they police this, who knows but so long as you invoice the UAE company then who is to know where you are.

 

[sonato]

What's the point to setup the company in the UAE if you can't avoid taxes (corporate taxes) and you can't maintain privacy? So you better go for a BVI or Panama company.

 

[aceupsleeve]

Yes mainland/onshore.
Mainland requires accounting but its easy to keep the cost down by sending yourself payments in bulk as dividend salary.
To clarify with regards to PTNHR you are not allowed to actively do business in Portugal. So long as you don't have any PT clients and don't get clients to pay you in the PT account. You can not do any work patterning to your business. For example if you are a Software Developer you cant actively work on projects whilst in PT. How they police this, who knows but so long as you invoice the UAE company then who is to know where you are.

Thanks for the reply.
I'm basically free to move anywhere.
are there any countries in europe that don't have income tax

Im not well researched about the subject because there are many options and its quite confusing finding organized information about all the nuances of each freezone and its up to datw rules without contacting a professional for at least 1h talk. so decided just to ask:

I'm thinking of opening Dubai offshore company for online advertising business. I have no intention or will to visit UAE and im not working with UAE users or customers.

Reason for Dubai is for 0% tax, no accounting, no reporting. Sounds like no headache.

My question is if this is really the case?

1. Is it still 0% corporate tax, dividend tax and any other tax?

2. Does reporting still not required?

3. Is it possible to open the company without visiting or getting a visa there ?

4. Is it possible for such company to open a bank account in UAE?

5. Are the double tax treaties UAE have with other countries relevant to UAE offshore companies?

Your experience and knowledge will really help, thank you .

Thanks for all your replies guys

 

[CaptK]

Thanks for the reply.
I'm basically free to move anywhere.
are there any countries in europe that don't have income tax

Thanks for all your replies guys

Monaco otherwise legally, no!!