The UAE is well known for being one of the most financially attractive locations worldwide, with a diversified economy and a unique low tax regime, making it ideal for structuring a company. James Turner, director of company formation specialists, Turner Little, writes
However, the UAE was recently added to the Financial Action Task Force ‘gray list’, to ensure the government takes steps to better align with global standards on anti-money laundering and counter terrorist financing. In addition to this, The UAE is introducing a federal corporate tax on business profits for the first time, which will come into effect on June 1st, 2023.
Increased scrutiny by organisations like the FATF, means that the UAE has become a jurisdiction under increased monitoring. This will have an increased impact on privacy, which is often one of the primary reasons individuals conduct business and undertake banking transactions in the name of an offshore corporation. Most offshore financial centres don’t typically disclose the responsible individuals to a third party.
Offshore companies can still be an excellent way to protect your privacy, screening your assets from public view, affording you an extra layer of protection from litigation. The number of offshore jurisdictions with specific legislative provisions for truly anonymous companies has declined in recent years, so it is important to do your research before choosing a jurisdiction, to ensure there are privacy laws in place that protect you from public scrutiny, keeping your personal information and accounts safe.
You also want a jurisdiction that is politically and economically stable, to ensure continuity and environmental scrutiny, in addition to a country that has a currency that is not volatile. Banks in the jurisdiction you choose should be liquid, with adequate capital reserves, backed by a government that has a sound economic policy, and the reputation of the country should be in good standing. At Turner Little, we take the time to understand the most appropriate structure and jurisdiction for your venture in order to not only protect your privacy but minimise your tax liability and create the right organisational structure for growth.