- May 10, 2018
With adequate substance you will need your own office, staff, utility bills."This was revealed by Arslan Mushtaq, Partner Tax at athGADLANG, during an exclusive interview with Gulf Today."
Seems like Arslan Mushtaq knows more then everyone else and even more then the Website from the Ministry of Finance reflects at the moment.
Long story short his point is basically that it's starting 01.06.2023 more then ever pointless - even for a UAE Resident - to have a Seychelles, Belize or BVI Offshore Company instead of a FZCO at 0% CT.
It's the dead of RAKICC and the other Old School Offshore Type of Companies even for the usage of a Holding Company as if it's used as a non-resident Offshore Company you won't get any Bank Account done and as soon as you are Resident the CT applies and no excemptions are in place unklike the Freezone Companies.
Last but not least it's over for the guys with some fake / remote worker Residence Visa and US LLC as already mentioned earlier here in the forum it was obviously that this won't be a sustainable longterm solution.
Congratulations so far to all our existing clients so far - you made everything right and things remain like they are.
“The freezones have robustly supported the UAE economy by attracting Foreign Direct Investment and offering ease of doing business. The CT regime has outlined the businesses operating in the freezones will be subject to the CT regime and meet the compliance obligation like registering and filing the CT return. However, the CT regime will honor the 0% tax incentive if freezone businesses maintain adequate substance and comply with all regulatory requirements. The freezone business can benefit from a 0% CT rate on income earned from transactions with businesses located outside of the UAE, income from trading with businesses located in the same or any other freezone, and income from certain regulated financial services from foreign markets.”
So your bottom line is filling a CT return which we will provide free of charge for our existiing clients - it's even becoming more attractive then ever using a FZCO as a Holding Company as well.
Well done UAE!
If you don't have that its in my opinion only a matter of time they will find out and tax you. So better have this in order. For those who don't have this substance it would be an additional cost of several thousands of USD a month,which makes UAE less attractive if you have a moderate income.