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UAE clarification of Freezone Qualifying Income

#602
uranium said:
I read that
I believe he work as investment banker
I wanted to know his exact job
Click to expand...
I understand this. Happens to me all the time.
People ask me this all the time about me and I have NO answer to it. Private bankers, investment bankers, lawyers, and accountants go crazy.

I do the following:

  1. Mr. Smith wants a product.
  2. He tells me.
  3. He discloses what he wants to pay for it.
  4. I question him and provide him with a sample or prototype.
  5. Once he approves it, I use my OWN money and acquire the product.
  6. I deliver it to Mr. Smith.
  7. Mr. Smith confirms and pays.
Such a simple business, yet NOBODY understands it (or they pretend they don't?).

I have sooooooo many Mr. Smiths that I'm working 24/7. Sometimes, I wonder if professionals, bankers, lawyers etc, are just pulling my leg and playing stupid to try to "scam" (=sell me their financial product) me :rolleyes:
 
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#603
jafo said:
I understand this. Happens to me all the time.
People ask me this all the time about me and I have NO answer to it. Private bankers, investment bankers, lawyers, and accountants go crazy.

I do the following:

  1. Mr. Smith wants a product.
  2. He tells me.
  3. He discloses what he wants to pay for it.
  4. I question him and provide him with a sample or prototype.
  5. Once he approves it, I use my OWN money and acquire the product.
  6. I deliver it to Mr. Smith.
  7. Mr. Smith confirms and pays.
Such a simple business, yet NOBODY understands it (or they pretend they don't?).

I have sooooooo many Mr. Smiths that I'm working 24/7. Sometimes, I wonder if professionals, bankers, lawyers etc, are just pulling my leg and playing stupid to try to "scam" (=sell me their financial product) me :rolleyes:
Click to expand...
I would call your business model:
Import and export
 
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#605

Corporate tax (CT) | The Official Portal of the UAE Government

Ministry of Finance announced that it will introduce federal Corporate tax (CT) on the net profits of businesses. The tax will become applicable either on 1 June 2023 or on 1 January 2024, depending on the financial year followed by the business. CT will be applied across all the emirates.
u.ae u.ae
Scope

CT will apply to:

  1. all businesses and individuals conducting business activities under a commercial licence in the UAE
  2. free zone businesses (The UAE CT regime will continue to honour the CT incentives currently being offered to free zone businesses that comply with all regulatory requirements and that do not conduct business set up in the UAE’s mainland.)
  3. Foreign entities and individuals only if they conduct a trade or business in the UAE in an ongoing or regular manner
  4. Banking operations
  5. Businesses engaged in real estate management, construction, development, agency and brokerage activities.
Click to expand...
Updated on 31 Jul 2023

Seems USA LLC only taxable If It conduct business in UAE....Hope this is the case....Finger crossed
 
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#608
troubled soul said:
Seems USA LLC only taxable If It conduct business in UAE....Hope this is the case...
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Managing a US LLC from UAE, closing contracts and getting paid doesn't mean conducing business in UAE?

LOL

troubled soul said:
Application For Clarification cost AED 1500.00
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You should apply if you don't want to find yourself on the wrong side of the dick.
 
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#609
Marzio said:
Managing a US LLC from UAE, closing contracts and getting paid doesn't mean conducing business in UAE?
Click to expand...
Well I am not expert in this area but...
  • Hiring UAE-based employees
  • Renting office space in the UAE
  • Advertising to UAE residents
  • Selling goods or services to UAE residents
will consider as a doing business in UAE....Running online business will be fine without local client ...I hope so
 
#611
troubled soul said:
Well I am not expert in this area but...
  • Hiring UAE-based employees
  • Renting office space in the UAE
  • Advertising to UAE residents
  • Selling goods or services to UAE residents
will consider as a doing business in UAE....Running online business will be fine without local client ...I hope so
Click to expand...
It doesn't work that way.

If you manage your company from the UAE - you're taxed. (there are exemptions for qualifying income only and some exemptions for small businesses).

I'm pretty sure most people who moved to the UAE for tax reasons have more than 1M AED revenue, so we all will be taxed.

Corporate tax rates will be 0% on taxable income up to AED 375,000 and 9% on taxable income over AED 375,000

So, the first 375k is not taxed. Everything over is taxed by 9%
 
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#612
Marzio said:
Hoping is a losing business strategy.

Invest those few AED and ask specifically if managing a US LLC from UAE selling outside UAE is tax exempt.

You'll find a definite answer.
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Even this is NOT foolproof! I have seen agencies go to court against people they gave a letter to claiming that whoever wrote that letter on behalf of the agency had NO authority to bind the agency!
 
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#614
yngmind said:
It doesn't work that way.

If you manage your company from the UAE - you're taxed. (there are exemptions for qualifying income only and some exemptions for small businesses).

I'm pretty sure most people who moved to the UAE for tax reasons have more than 1M AED revenue, so we all will be taxed.

Corporate tax rates will be 0% on taxable income up to AED 375,000 and 9% on taxable income over AED 375,000

So, the first 375k is not taxed. Everything over is taxed by 9%
Click to expand...
Exactly, most of people who moved there to really live generate more than 375 AED per year...

stronco said:
Resident or Tax Resident?
Click to expand...
If you do business from UAE, you are taxed
Being resident in UAE can qualify that you do business from UAE
 
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#619
US LLCs aside, this information is both interesting and confusing:
  1. free zone businesses (The UAE CT regime will continue to honour the CT incentives currently being offered to free zone businesses that comply with all regulatory requirements and that do not conduct business set up in the UAE’s mainland.)
So continuing to honor CT incentives would mean 0 tax (as that is the current incentive), but what does "that do not conduct business set up in the UAE's mainland" possibly mean? It seems to be missing a word or two in there.

stronco said:
This is a very handwavy answer.

You could be resident but cant even get tax cert because not staying long enough and/or do not meet other requirements.
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Doing business from UAE and in UAE are surely two different things. From UAE implies doing business while physically there, while in UAE implies having UAE customers. It seems this clarification talks about the latter.
 
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#620
Larin said:
Doing business from UAE and in UAE are surely two different things. From UAE implies doing business while physically there, while in UAE implies having UAE customers. It seems this clarification talks about the latter.
Click to expand...

That is not clear at all.

There are two things at play. One is your own physical presence aka PE aka tax residence (not just residence). Second is customer-location.

People are mixing this up by not expressing it clearly.
 
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