Companies in the UAE are subject to taxes – whether VAT or an activity specific tax, which is highly rare- or a tax on a specific product, usually products that are often harmful to health. Business founders are usually concerned with protecting their interests and businesses from taxes when they establish it. Therefore, the aim of such protection may require getting a tax consultation before starting a business or during running a business as laws and regulations change. At Nour Attorneys Law Firm, provides tax consultation services in the United Arab Emirates, Egypt, and Saudi Arabia through our tax agents in these countries and internationally at the level of business establishment and tax treatment in the light of international agreements to avoid double taxation. This service that we offer focuses on providing tax consultations to those who wish to start a business and our existing clients in the UAE. Nour Attorneys Law Firm works along with a team of accountants and tax consultants to provide tax consultation services to our clients before or after establishing a business.

First: Tax Consultations before Establishing a Business

Business founders are often concerned with the tax that is to be levied on business activities that they practice. The value of such tax, when establishing a business in a country, depends on

1: The Nature of the Tax to which the Founder /Partners and the Company are Subject

  • The Type of Tax to which the Founder of Business is Subject to in his/her Person:

In terms of their income being subject to direct taxation and /or subject to capital gains tax or benefits earned by the founder through companies owned by him/her, whatever was the country from which he/she gets his income or whatever it was its nature, for example, the American citizen’s income is subject to the American taxation system, whether the citizen was living in the United States of America or outside it, since such tax is associated with the founder in his/her person. Another example of this is Egyptian citizens; their income from any source outside the state is not subject to a local tax as long as the work, income and treatment are carried out outside the state. Therefore, they may resort to the establishment of offshore companies to own and manage their offshore business, spend and disburse all expenses outside the Arab Republic of Egypt, and not to transfer any amounts if they reside there.

It should be noted that, in some cases, countries grant full exemption from taxes for in-kind privileges enjoyed by the client from the company he/she works at or the companies he/she deals with. All the above determine the best country and the place of establishment in accordance with the tax to which you will be subject or exempted.

  • The Tax to which the Company is Subject and the Tax Treatment at the Client’s Home Country:

All companies are taxed, but the tax’s percentage varies from country to country. Someone may set up a company abroad and transfer their profits from it to be able to calculate the difference in a way that is better than setting up a company in their home country directly. This procedure aims at enjoying the difference of tax exemption if their country has signed tax exemption agreements. One example is if a Swiss national established a company in Singapore to take advantage of the non-double taxation agreement between the two countries instead of establishing a company directly in his home country, since the tax difference may amount to an exemption of 18%.

Second: Tax Consultations after Establishing a Business

There are many taxes that we can provide advice and consultation on. Hence, for your information, we offer you a simplified explanation of the forms of taxes that companies may be subject to in general. In some countries, the in-kind privileges enjoyed by the client from his company or the companies which he deals with provide tax exemption from the taxes all together. All these factors determine where you should establish your business, taking into consideration the taxes to which you will be subject or exempted from. It is noteworthy that some business founders require that their businesses be taxed and/ or that profits are distributed to enjoy the exemption difference if their respective countries have signed tax exemption agreements. For your information, we list below a simplified form of tax types: Disclaimer: The taxes described below are intended in a general sense only. In the UAE, there only the value-added tax and taxes which are levied on products that are harmful to health.
    • Income Taxes on Companies and Individuals

    This tax type is a comprehensive tax. It is a tax value that is levied on the total income of the company, regardless of whether it is the product of selling goods or services in its various forms.

    • Taxes on the Goods Sold by a Company

    This tax is levied on companies engaged in the sale of goods. It should be noted that some goods are exempted from this tax due to their economic importance, and services are not subject to such tax.

    •  Taxes on the Distribution of Profits

    This tax is levied on the distribution of profits to corporate partners, whether they were individuals or companies

    • Regional Tax

    This tax is usually levied on economic activities or income from doing business in the country of incorporation, and income from outside the country shall be exempted from such tax.

    • The Value-Added Tax

    The value-added tax is levied on goods and services that are being traded on the market.

Nour Attorneys Law Firm perfectly assist you to decide the most suitable terms of the place and country to establish your business, to ensure that you enjoy all the privileges and to get your profits in the form of disturbed profits, in-kind privileges, or expenses. You can consult your tax consultant in your home country later to arrange and confirm how to carry out the procedure and to be aware of the easiest solution to carry out such procedure before establishing a business, to avoid any difficulty while carrying out the procedure later or the complexity of its implementation. In case if you have already established your business, our law firm provides tax consultation services locally and regionally through our extensive relationships in the tax consultation field. We also provide the optimal advice on where you should establish your business and how to conduct your tax treatment.

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