UAE tax planning in 2024

corporate tax planning and legal obligations in UAEThe UAE Ministry of Finance will officially implement VAT at the rate of 5% on 1 January 2018, with some limited exceptions on basic food items, healthcare and education. However, there are still new policy announcements added from time to time, as UAE prepares for the new VAT system.

Apart from the launch of the new VAT system in 2018, the following information may be useful to our Client in relation to tax planning in the UAE:

  1. Companies in the UAE pay no corporate or capital gains tax on worldwide-sourced income;
  2. Franked dividends from a UAE subsidiary are not subject to withholding tax when paid to the foreign parent company;
  3. Territory, state, and local governments do not impose additional corporate tax. However, they do impose some taxes which might affect foreign companies operating in the country, including payroll tax (more applicable to larger employers), stamp duty, and land tax;
  4. There are many ways in which investors can conduct business, including corporations, branch offices, subsidiaries, joint ventures and partnerships. 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 (neither is subject to corporate tax in the UAE), in practice most foreign companies choose to operate through a locally-established subsidiary company, as this has the added benefits of a distinct legal personality and limited liability;
  5. The UAE has signed double tax agreements with more than 40 countries, including 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;

Healy Consultants tax planning services

  1. Many strategic advantages are offered to international business people by the UAE. Healy Consultants’ tax experts deliver a comprehensive strategy to our Clients. A successful 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?
      A properly-structured UAE company is exempt from 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 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);
  2. To allow us to tailor the optimum tax planning strategy for our Clients, it is important that Healy Consultants has a firm understanding of your business and aware of your future objectives. In this respect, we encourage Clients to discuss with us by phone the different strategies available;
  3. Healy Consultants has a range of UAE services which are designed to meet your exact needs. Unlike many corporate services providers, we take a global approach to our tax planning service, with innovative strategies to fit your needs. Our international tax professionals provide the best tax planning service to organisations of all sizes. Our services include but are not limited to:
    • Offshore company formation – offshore company formation is an important aspect of Healy Consultants’ 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’ service portfolio. With tax advantages in mind, we are able to assist you in opening a UAE or 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 services include providing 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 strategy is the need to keep abreast of international tax legislation. A key aspect of Healy Consultants’ service lies in keeping our Clients informed of regulatory changes before they may have any negative impact;
    • Double taxation treaties: the 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 strategy and one of our tax planning services;
    • UAE corporate and personal income tax advice – Healy Consultants’ UAE corporate tax planning services include advising Clients on the latest corporate and personal income tax rates in the UAE, as well as assisting our Clients to prepare and submit UAE corporation tax computations and UAE tax returns to the relevant tax authorities.

Contact us

For additional information on our tax planning services in UAE, please contact our in-house country expert, Ms. Chrissi Zamora, directly:
client relationship officer - Chrissi