Tax and accounting regulations
There is no federal tax legislation in the UAE, each emirate has its own tax law. Only oil, gas and petrochemical companies are required to pay taxes.
Below is an overview of the tax and accounting regulations in RAK:
RAK Tax System:
- Income Tax – 100% Income Tax exemption
- Value Added Tax (VAT) – There is no VAT in the UAE
- Capital Gains Tax (CGT) – There is no Capital Gains Tax in the UAE
- Corporation Tax – 100% Corporation Tax exemption
- Taxation of Dividends -Profits derived from dividends are taxed only in the state from which the income was earned. Dividend income paid by a UAE company to another company which has a double taxation treaty with the UAE may not be taxable in the foreign company even though no tax was paid in the UAE
- Taxation of Royalties – Profits derived from royalties are taxed only in the state from which the income was earned.
- Taxation of Interest – Profits derived from interest are taxed only in the state from which the income was earned.
- Withholding Tax – No Withholding Tax applicable
- Capital Duties – 100% Capital and Profit repatriation
- Import / Export Taxes – No import or export taxes
- Net Worth Tax – No Net Worth tax
International Aspects of Taxation:
- RAK has rapidly gained a reputation for being a tax free, transparent jurisdiction and it is of paramount concern that the reputation of RAK is not tainted by money laundering or any other illegal practices therefore anti-avoidance regulations are enforced.
System of Double Tax Treaties:
- The UAE has over 40 Double Taxation Treaties in place.
- As the UAE has no taxes, double taxation treaties are aimed at making the UAE a more attractive territory in which to operate by reducing taxation levied in foreign jurisdictions on profits remitted abroad by foreign entities operating in the UAE.
- RAK currently has a DTTA with the following countries: Austria, Belarus, Canada, Czech Republic, Egypt, Finland, France, Germany, India, Indonesia, Italy, Lebanon, Malaysia, Malta, Morocco, New Zealand, Pakistan, Poland, Romania, Singapore, Sudan, Thailand, Tunisia, Turkey and Ukraine.
Annual Reporting Requirements:
- Accounting records must be kept for 7 years from the date on which they were prepared.
- Accounts are required to be approved and signed by the directors but there is no requirement for accounts to be filed with the RAK authorities.
- No audit is required.
A coherent offshore tax planning strategy is essential to maximize the effectiveness of offshore companies. Eltoma can assist by structuring the most tax efficient strategy to satisfy your requirements. Eltoma will guide you as to which jurisdictions offer the best tax structure by identifying the types of tax payable as well as applicable exemptions and incentives. Eltoma will provide tax planning advice that will identify which is the most favourable tax efficient jurisdiction in which to incorporate.
The Belize IBC Amendment Act 2017: 3 notable changes for businesses
Belize has amended its International Business Companies Act. These changes were to maintain its financial services industry in the increasingly regulated international market & meet the OECD white list requirements.
Cryptocurrency & ICOs as securities & virtual commodities as per Hong Kong law
The Hong Kong Securities and Futures Commission has remarked upon the growth and popularity of Initial Coin Offerings (ICOs) for raising money not only in Hong Kong but other Asian countries. This article confirms and explains how digital tokens that are offered or sold may be defined as "securities" and as such are therefore governed by the relevant securities legislation of Hong Kong.
New licensing regulations for Trusts & Service Providers in Hong Kong
As per new regulations, all Hong Kong businesses providing Trustee Services, including Corporate Service Providers will not be able to operate without a valid trading license after March the 1st 2018. The new scheme is designed to better regulate individuals carrying out services within the financial sphere in Hong Kong and will be overseen and administered by the Hong Kong Companies Registry.
The terms of Hong Kong's new register of significant controllers and what it means for companies
As per new legislation, from March 1st 2018, every company incorporated in Hong Kong will be required to keep and maintain a register of all persons who have significant control of the company. The record must be updated as required and kept at the registered company address, even if there are no persons of significant control.
The pros & cons of European Passport-by-Investment schemes
In a bid to rebuild the dwindling economy in Cyprus shortly after the financial crisis four years ago, the government launched a passport-by-investment program to temp wealthy foreigners with citizenship in exchange for an investment of no less than €2 million into the Cyprus economy.
Using the Cyprus Non-Dom scheme for beneficial tax planning
In an attempt to improve and simplify the Cyprus tax system as well as to remain a highly compliant and attractive jurisdiction, the introduction of the non-domicile (shortened to Non-Dom) scheme aims to give Cyprus a competitive edge over other jurisdictions.
How are Cyprus banks handling the island's high rate of NPLs? Can more be done to combat them?
It is no secret that the Cyprus banking sector is struggling with the overwhelming level of Non-Performing Loans (NPLs), no matter the efforts exerted by the main banks in Cyprus by following conventional banking models to balance their profit/loss reports, NPLs remain to be the proverbial hole in the bucket.
Income tax exemptions for expats living in Cyprus: what are your options?
Situated in the Eastern Mediterranean, the Republic of Cyprus boasts a strategic geographical location at the hub of three continents; Europe, Asia and Africa and a pleasant sunny climate year round.