Tax Planning in the UAE

Crucial to tax planning in the UAE, a company is deemed to be UAE-resident if it has been formed in the UAE; if the company's central management and administration is in the UAE, even if it was formed in another jurisdiction; and if the company conducts business in the UAE and its voting control is in the hands of resident UAE shareholders, even though it was incorporated in another jurisdiction or its central management is in another jurisdiction.

Companies in the UAE pay no income and capital gains tax on worldwide-sourced income.

When tax planning in the UAE, it must be considered that franked dividends from an UAE subsidiary are not subject to withholding tax when paid to the foreign parent company.

Territory, state, and local governments do not impose additional corporate tax, which comes into consideration when tax planning in the UAE. However, they do impose some taxes which might impact foreign companies operating in the country, including payroll tax (more applicable to larger employers), stamp duty and land tax.

When tax planning in the UAE, there are many different ways in which investors can conduct business, including corporations, branch offices, subsidiaries, joint ventures, partnerships and trusts. However, for international investors the most appropriate vehicles are usually UAE subsidiary companies or UAE branch offices. Although there is not a great deal to choose between the two (both are subject to the standard corporate tax rate), in practice most foreign companies choose to operate through a locally-established subsidiary company, as this has the added benefits of limited liability and separate legal status.

When tax planning in the UAE, the country has signed Double Tax Agreements with more than 40 countries, including the recent agreements with Germany and Ireland. A Certificate of Payment, as proof for non-residents of taxes paid, will only be verified for those payees whose country of residence has a comprehensive double taxation agreement with UAE. For a list of UAE's Double Tax treaties, please refer to the UAE Interact website.

Many strategic advantages are offered to international business people by UAE. A successful UAE tax planning strategy requires taking advantages of UAE tax regulations. Healy Consultants' tax experts deliver a comprehensive UAE tax planning strategy to our clients. A successful UAE tax planning strategy should address some of the following issues:

Can the UAE company receive foreign-sourced income without being subject to local corporation tax? Central to UAE tax planning strategy is the rule that a properly-structured UAE company is exempt from further tax payment on such income if it is from a "listed" jurisdiction, subject however to Controlled Foreign Corporation (CFC) rules. A listed jurisdiction is a jurisdiction which has a similar tax system to the UAE.

Are any tax exemptions or tax incentives available in the UAE? A successful UAE tax planning strategy should identify both tax exemptions and restrictions. Resident companies pay tax on their worldwide income and capital gains (with certain categories of income and capital gains being exempted and with tax credits being granted where income and capital gains have already been taxed in a foreign jurisdiction).

To allow us to tailor the optimum UAE tax planning strategy for our clients, it is important Healy Consultants has a firm understanding of your business and aware of your future objectives. In this respect, we encourage clients to discuss via phone the different UAE tax planning strategies available.

Healy Consultants has a range of UAE tax planning services which are designed to meet your exact needs. Unlike many corporate services providers, we take a global approach to our UAE tax planning services, thinking 'outside the box' to create the best UAE tax planning strategy which fits your needs. Our international tax professionals provide the best UAE tax planning services to organisations of all sizes. Our UAE tax planning services include but are not limited to:

Offshore company formation - offshore company formation is an important aspect of Healy Consultants' UAE tax planning services. In certain circumstances, a properly-structured offshore company results in a tax-efficient corporate vehicle through which international business can be conducted.

Offshore Trusts and Foundations - offshore Trusts and Foundations are ideal for entrepreneurs and high net worth investors who need to legally minimise their international tax exposure and optimise asset protection.

UAE corporate bank accounts - offering a reputable and reliable corporate bank account is fundamental to Healy Consultants' UAE tax planning services portfolio. With tax advantages in mind, we are able to assist you in penning an UAE or an international corporate bank account with leading international banks such as HSBC, Standard Chartered and Citibank in the jurisdiction of your choice.

Mergers and Acquisitions (M&A) - some clients approach us for assistance with their merger and acquisition plans. Our UAE tax planning services include providing invaluable advice on drawing up an M&A roadmap and developing a tax-efficient structure in going forward.

UAE and international tax legislation - at the heart of our successful UAE tax planning strategy is the need to keep abreast of international tax legislation. A key aspect of Healy Consultants' UAE tax planning services lies within keeping our clients informed of regulatory changes before they may have any negative impact.

Double Taxation Treaties - UAE has signed double taxation agreements with more than 40 countries. Making our clients aware of the availability of such tax relief tools is a core element of our UAE tax planning strategy and one of our UAE tax planning services.

UAE Corporate and personal income tax advice - Healy Consultants' UAE tax planning services include advising clients on the latest corporate and personal income tax rates in the UAE, as well as assist our client to prepare and submit UAE corporation tax computations and UAE tax returns to the relevant tax authorities.

Back to UAE Company Formation page.