Are Offshore Company Incorporation and Freezone Business Setups the Next Big Things in Dubai?

It is probably an undeniable fact that offshore company incorporation in the United Arab Emirates is one of the most talked about phenomenon in today’s world.  However, there are several factors associated with the rising popularity of both onshore and offshore company setup in and around the country. If we are to talk about the last three decades has seen a drastic change, which has eventually resulted into a more diversified economy with low operational and logistical costs.

When it comes to an offshore company formation or a business setup in Dubai Freezone, expats might tend to be somewhat skeptical about it at the beginning, but what I personally feel is the fact that the country is now equipped with an impressive infrastructure and other economically advanced amenities that can help an individual establish trades and carry out all operational duties in and around the city of Dubai.

 If we are to talk about it more explicitly, then it is to be mentioned that there are a few perks and allowances available to the entrepreneurs planning to set up offshore ventures and companies in the freezones of Dubai. Let’s know about it further.

Offshore company setup in Dubai

Setting up offshore companies in and around the city of Dubai has several advantages. From strategic location to a diversified and open market that the entrepreneurs are likely to enjoy, this city is reportedly all geared up to help all enthusiastic businessmen enjoy seamless business transactions, prosperity and growth in the long run. For example, we all know that taxation is a major issue of concern when it comes to trading.

Now, the good news is the fact that establishing offshore business in the city will help people to enjoy 100% tax exemption. Moreover, an offshore company can be formed in virtual form. This means that there is no requirement for an individual to have an office in the UAE. Also, an offshore company apparently takes lesser time to get established as the incorporation process for the same is comparatively faster.

Freezone business setup in Dubai

Talking of the Freezone company setup in and around Dubai, it is to be mentioned that setting up a company in Dubai’s Freezone might just help an individual get better opportunities to carry on with their corporate operations in a smoother and seamless way. Here’s why:

• Investors get to enjoy 100% ownership, irrespective of their nationality.
• Entrepreneurs get to enjoy import and export duty exemptions.
• There’s the perk of enjoying 100% tax exemption on all corporate and capital gains.
• There’s no requirement for depositing any capital amount.
• The advantage of enjoying corporate tax exemption for 15 years.

However, with the above mentioned data accumulated from trusted sources, it seems that the business scenario in and around the city of Dubai is fairly promising, and setting up offshore companies and businesses in the freezones of the city might just prove to be a favorable venture.

Everything you need to Know about Freezone Company Formation in UAE

Freezone company formation in UAE can be a favourable decision for businessmen because of the advantages it brings, and also because, it is much easier to start a business in this area. But, there are many steps involved in the process, along with various laws and regulations, about which, every entrepreneur must know.

Just like the process of offshore company setup, it is also easy to start a company in the freezones of UAE. However, the rules vary according to the concerned freezone.

What are freezones in UAE?

In UAE, there are several freezones in the various states. These areas come with special benefits like full ownership by the foreign investor, special regulations regarding tax, imports, and customs. Along with this, other incentives are also provided to business owners in these areas, so that, business practices can be carried out efficiently.

How to set-up a company in a freezone of UAE?

Despite the different rules and regulations of each freezone, the common steps involved in the procedure of a freezone company formation in UAE are as follows:

• Deciding the business entity type- In a freezone, one gets the options for starting his/her firm as either a Free Zone Company or, Free Zone Establishment. This kind of business entity has its own set of rules. Hence, one should be aware of those before selecting one. Apart from this, an investor can also open a branch office in the freezone.
• Choosing a name for the company- Before selecting a name, one should ensure that it is not already registered, and abides by the laws concerning company names in the UAE.
• Business licence- Based on the main business activity, the kind of business licence one will get will be decided. Each freezone has its list of business activities that a company can carry out, according to which one can apply for the business licence.
• Getting all the approvals and registration- To start the business, some initial approvals are needed. Following this, the entrepreneur needs to pay all the fees. After all the fees and documents are submitted, the trade licence will be issued and the visa process will begin.

Before one proceeds with the freezone company formation in UAE, he/she must learn about the regulating authorities and all the concerned rules.

How Tax agent portal has simplified the lives of Tax agents in Dubai?

VAT is now a new concept in Dubai. It was effective from 1st January 2018 at the rate of 5% with the help of the FTA (Federal Tax Authority). Hence, there was an increasing demand for tax agents who are willing to cater to the needs of the taxable persons by using the tax agent portal.

Let us tell you how the tax agent portal is actually helping the tax agents in Dubai.

The Tax Agent Portal provides an active service 24*7. You can access various information, functions and services with its help. It provides a secure environment to the Tax agents to execute their work effectively. Few other functionalities of the Tax agent portal are as follows:

1. 1. View information – It helps the tax agents to view information about the clients’ accounts and registrations. You can check all the details of the enquiries sent, the current status of the enquiries made or the estimated date of completion for the enquiries.
2. Manage client list – It helps the tax agents to list out or search for specific clients and manage them accordingly. It provides detailed information of the transaction and the refunds, client’s communication with the agent, and the current communication status with the help of a receipt number generated while registering.
3. Access mail reports – It helps the tax agents to send and receive emails securely. It generally consists of the replies to the portal connections which include the online forms like VAT refund forms and others.
4. Make updates – It helps in updating the client’s registration details like the person’s name, home address and phone number in real time.
5. Generate statement – It helps in preparing, lodging, viewing and printing activity statements for clients.
6. 6. Activity statement – With the help of this portal, the tax agents can view the lodged list of activity statements.
7. Refunds and credit transfers – By the help of this portal, the tax agents can request for refunds and credit transfer on behalf of their clients.
8. Calculation details – It helps the tax agents to view the calculation details regarding the interest charges. These portals have many online tools and calculators to furnish accurate details.
9. Online forms – Tax agents can request the tax office services on this portal for a variety of online forms including VAT refund form. Here, you can complete and submit your forms only when you are online.
10. Lodge objection – Tax agent portal helps the tax agents to apply for a private ruling. It also helps in lodging any objections or submitting additional information.

Therefore, a tax agent portal is an all-round portal, helping the tax agents to cater to the needs of the taxable people in Dubai.

The Various Business Structure in the UAE

A lot of people, especially the foreign investors stress on the process of company setup in UAE rather than focusing on what type of business structure will be ideal for his/her business. You will be surprised to know that you can establish your company in the UAE in 7 different forms. Each of the business structure varies from the next one in so many aspects. If you are willing to set up a business in the UAE, you may need to choose any of the following forms of business structure for your company.

1. General Partnership:

Company incorporation with a general partnership is limited to UAE nationals only. So if you are a foreign investor, you cannot select this business structure for your company.

2. Partnership Limited by Liability:

Even though the foreign investors don’t have the option to go for a general partnership, they can apply for partnership limited by liability for the company. The limited liability company (LLC) is ideal for the foreign investors where they can choose a local partner and run a business with a limited share.

3. Joint Venture:

Joint venture refers to a contractual agreement between two or more individuals, companies or associations with a common economic objective. It can be local or international in scope. Even though the joint ventures are considered as a separate business option, it also envelops other business structures like a general partnership, limited partnership, joint stock company, and even a freezone company.

4. Public Joint Stock:

A public joint stock company requires AED 10,000,000 as minimum share capital with the minimum of 10 founders for the process of company setup in UAE. In fact, the shares of the public joint stock should be offered to the public, and the subscription notices should be published in any two local dailies. Also, it should have 3 to 15 directors for the term of three years.

5. Private Joint Stock:

A private joint stock, on the other hand, requires AED 2,000,000 as minimum share capital with 3 founders minimum. All the regulations applicable to the public joint stock are also applicable for the private joint stock, except for the fact that the shares of the private joint cannot be offered to be public. This business structure is ideal for large projects like banking, insurance, etc.

There are other business structures like a regional office of a foreign company, sole proprietorship and much more. The LLC companies are the most commonly availed option among the foreign investors. However, if the person wants and the government permits, a person can choose any of the aforementioned business structure for his company setup in UAE.

6 Best Business Startup Ideas in Dubai

The United Arab Emirates, especially Dubai, is a great place for starting a business due to the diversity and versatility of cultures in the country. Dubai is teeming with resources which makes it ideal for you to get ready for a new business set up in Dubai very high.

Here are some of the best business ideas for your new startup in Dubai.

1.      Jewellery Designing and Making

Considering that Dubai is known as the Mecca of gold, jewellery making is a great business option in the middle-eastern country. There are special loans too that are only given to entrepreneurs who want to enter the jewellery designing business. The prospects of this business are very high, and there are very less chances that your company may not flourish.

2.      Tutoring – Both online and offline

This might not be a conventional idea for a new business startup in Dubai, but teaching can be considered a good line in the country. Especially, when there is a dearth of good English teachers in the gulf countries. So, you can consider this as an opportunity and open a tutoring centre or an online assignment help business.

3. Event Management Companies

The people in Emirates love to celebrate different occasions quite extravagantly. Almost every household celebrates a birthday, weddings and religious gatherings. So event management has a great future since these celebrations need to be arranged and executed well. You can also start a business of products required in a party like a catering line and other types of party supplies.

4.      Luxury Travelling Deals

Dubai is a great destination for tourists from different parts of the globe, and therefore tourism contributes to the economy of the country considerably. Considering how many people visit Dubai and other Gulf countries per year, a new business set up in Dubaithat deals in luxury travelling is a great option. You can offer luxury tours and other exciting packages to the tourists. You can also invest in the hotel industry for the same apparent reason.

5.      Business Consultancies

Since so many people are arriving in Dubai, there is a good chance that the entrepreneurs will be looking for a company incorporation consultant. So it might be a good idea to open a consultancy. For the new businesses that crop up every day, you can also provide the services of a business broker.

6.      Business of Gadgets Repair

Since digitalisation is a process that is only a progressive evolution, there is a constant need for enough repairers of gadgets. Dubai is a rich country, and you can imagine the high end gadgets that they use in their daily lives. So opening a gadget repairing agency might be a brainwave too.

Dubai is a country with many vistas. So if you dream to make it big in the business world, Dubai can definitely be your calling!

Know Everything About VAT Consultants Registration in Dubai

The recent addition of the VAT has given birth to a new rise in demand for professionals like VAT consultants in Dubai and the other parts of the UAE. These professionals can help any business to properly carry out all the VAT related tasks and avoid any penalty. But, to work as a professional, it is required for all individuals to complete their tax agent registration first. The FTA or Federal Tax Authority has set some specific criteria which need to be fulfilled in order to apply for the registration. So, any expert wishing to serve as a VAT consultant in this nation must have complete knowledge about this registration.

What are the requirements for an individual to be registered as a VAT or tax agent in the UAE?

The following high standards have been set by the FTA which must be fulfilled by the person to be registered:

• Must have a fluency in English and Arabic
• The FTA exam needs to be taken and also, pass in it
• Must have an experience of three years in the field of law, accounting, and tax
• Should have a master’s or bachelor’s degree in law, tax, or accounting from a recognised institution
• Must not have any past record of misconduct, crime, or wrongdoing
• Should be fully fit physically for carrying out the tasks of his/her clients
• The professional indemnity insurance must be held by the person

How to do the registration?

At first, the individuals need to check if they meet all the criteria and standard set by the FTA. If all the requirements are fulfilled, they can go ahead with the application.

1. Professionals must apply through the official application form of FTA.
2. After this, the applicant may get asked for any extra information, an interview, or anything else. Not more than fifteen days, from the submission date, will be taken by the FTA decide on the submitted application. In case, there is a need for any extra information, the FTA will make its decision on the application in fifteen days from the day the authority receives the extra information.
3. Following the primary approval is received from the FTA, the required fees need to be paid by the applicant.
4. The applicants will be informed about the rejection or acceptance of the application within twenty days from the day the FTA provided the primary approval.
5. After this, the approved professionals will be included in the Tax Agents register for three years. When this tenure of three years ends, the individuals can renew their registration.

Professionals must also be aware of the fact that there are certain circumstances under which their permit or registration can also get cancelled. So, it is necessary for them to ensure that all the requirements are strictly followed while doing this registration for the VAT professionals.     

Factors that UAE accounting experts look for in a tax software

With the advent of VAT in the UAE VAT registration portals are in demand. So if you are thinking of investing in a tax portal for your corporate organisation, we can help you choose a good portal software. The portal is a one-time investment and before you get it installed, do make sure that it is multifaceted and can manage the various tax policies of your company efficiently.

So, if you are wondering how to choose a reliable and cost-effective tax portal for your company, here is a list of factors that you must consider.

VAT return compatibility

You must make sure that the UAE VAT registration portal is compatible with both cash and invoice accounting and can cope with all VAT schemes in the UAE. In case you need to file a VAT return online, you must also check whether the portal can produce an automatic VAT return or not.

Comes with the Banking Feature

Always go for a portal that offers bank module as a feature so that you can link your tax accounts to your bank account and synchronise them automatically. This way you will be able to consider the bank figures while preparing the tax files for your company.

Multiple-User Friendly

The portal must have a multi-user feature so that your team of accountants can take care of the taxation and VAT issues of your company and work on it together while being in the loop all the time. 

Link with personal tax accounts

Always choose a UAE VAT registration portal that gives you the option of linking your personal tax accounts with the tax accounts of your business. Choose a module that can connect the details of the incomes from your company and use them to assess your personal tax return.

Customer Support Backup

Like every other software, portals can crash at times too, as a result of which your staff can face a problem while operating it at times. To save your business from suffering the loss from unproductive hours, make sure that you choose a portal that has customer care support backup. So that when you have doubts, you can ring them up and can get your problems solved easily.

Should be Mobile Compatible

Choose a UAE VAT registration portal that has a mobile version so that you can use it on your cell phone for emergencies and quick views. However, the mobile application may or may not have all the features that the actual portal has.

Also, remember that it is better to opt for a web-based portal solution as that will be most cost-effective. So make sure that the portal ticks the above boxes and then invest in it.