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Importance of Tax Planning in the UAE | Tax Structuring in UAE

Tax Planning refers to the process of creating and implementing various strategies in order to minimize the amount of taxes paid for a given period. The main purpose of tax planning UAE is to ensure tax efficiency and reduce taxation.

People generally ask whether UAE is a tax-free country or not (excluding VAT, Real estate stamp duty, Municipality tax on offices & customs duties). The answer to this is yes, as there is no personal income, capital gain or corporate profit taxes (except for oil companies and foreign banks), but situations may arise where individuals & companies will have to pay tax abroad while being residents in UAE. Living in UAE does not mean that you, your assets, your estate or your business are sheltered from foreign taxation.

Furthermore, the UAE residency avails double tax treaty benefits which avoid double taxation by minimizing or eliminating the source income state taxation: For example, HNWIs owning international businesses, can manage the timing of tax bills and avoid paying double taxes by setting up entities in the UAE. Double taxation is defined when similar taxes are imposed in two countries on the same tax payer on the same tax base, which harmfully affects the exchange of goods, services and capital and technology transfer and trade across the border. Public and private companies, investment firms, air transport firms and other companies operating in the UAE, as well as residents, benefit from Avoidance of Double Taxation Agreements (DTA). With the purpose of promoting its development goals, the UAE concluded 115 DTA to with most of its trade partners.

HNWI, multinationals and international group of companies would benefit from tax planning in UAE in a few ways:

  • Obtaining tax residency in UAE, being granted a tax residency certificate (TRC), through real estate investments or establishment of a corporate entity (aside employment contract) to shelter from foreign residency taxation and AEOI/ CRS
  • Establishing a proper, efficient and resilient Estate planning for assets held in UAE and abroad to minimize or remove estate tax.
  • Establishing companies/ subsidiaries in the UAE which, except oil companies and foreign banks, are not required to pay local corporate or capital gains tax on local and worldwide sourced income: UAE subsidiaries do not have to pay any tax on the dividends they pay over to their foreign parent company;
  • Establishing a UAE Holding company and benefiting of UAE double Tax treaties with 115 Countries to minimize source income taxation abroad.
  • Economic Substance Regulation requirements are cost efficiently met in the UAE unlike in Offshore Financial Centers (Cayman, BVI, Jersey, IOM, Mauritius, Singapore…).
  • Foreign Companies may choose to operate in the UAE through a UAE subsidiary, which is the most common choice as they have the benefit of a distinct legal identity and limited liability.
  • UK expats living in Dubai have a lot of opportunities to reduce the amount of UK tax they pay on their income and investments.
  • Tax Planning UAE is an important aspect to consider when it comes to owning any type of asset & property or bank account in UK, India, France, Spain or anywhere else.

HNWI’s, Expats and corporate entities can smoothly carry on business with the help of Wincore Advisory Group as we ensure tax compliance with the required laws and provide services such as:

  • Tax strategies for high net worth individuals and their families;
  • Multi-state tax optimization;
  • International tax compliance;
  • Inheritance tax planning;
  • Tax risks management and regular updates on regulatory and tax change.

For Support and assistance on any of these matters Get in Touch with our Corporate Team Today 

Wincore specializes in Tax, Corporate and Fiduciary matters. We provide pragmatic, flexible and efficient solutions to individual entrepreneurs, startup businesses, foreign and local SMEs, multinationals, wealthy international families, HNWIs and UHNWIs.

Wincore Advisory Group’s full range of services on : CRS (AEOI) – OECD exchange of information ; Economic Substance Regulations; Trust & Foundation; Asset protectionEstate & Tax Planning; Corporate Services; Sophisticated UAE Sponsorship PlanningDebt Collection Services in UAE; Residency & Citizenship Services ( Foreign second passports).

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Mohammad Rahali

Managing Partner


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Importance of Tax Planning in the UAE | Tax Structuring in UAE

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