18 11 2020

The most common business myths in the UAE. Part 3

images

And the final article in a series of articles on myths in the business sphere of the United Arab Emirates.

6th myth. In any case, companies in the United Arab Emirates will have to pay 5% VAT.

In fact, the UAE has a VAT rate of 5%, but this applies only to those companies that operate in the domestic market of the Emirates.

7th myth. Regarding the economic “substence”.

In the United Arab Emirates, rules on economic "substance" began to operate. These are innovations to which you need to adapt and conduct legal activities in accordance with them. It is necessary to conduct business 100% transparently and, upon request, show that the business is actually functioning. As proof of this fact can be: office space, company website, concluded contracts, formalized personnel, etc.

In comparison with other jurisdictions, the UAE looks more attractive. The cost of renting office space here is lower than in Belize or the BVI. And in free zones, you can use a joint workspace instead of a full-fledged office space, which will help save money. For foreign employees, the process of obtaining a resident visa is simplified as much as possible.

8th myth. There are no Russian-speaking staff in banking institutions.

There are employees who speak Russian in most banks.

9th myth. The bank can take the money for itself.

The entire banking system in the UAE is considered the benchmark for reliability and security. Banks, both international and local, provide a large number of opportunities for foreign investors, from a wide range of available services to guaranteeing the safety of investments.

And after obtaining the status of a tax resident of the United Arab Emirates, you avoid automatic exchange of information.

10th myth. The process of starting a business in the Emirates is very laborious for a foreign citizen.

When comparing the UAE with other jurisdictions, we can say with full responsibility that the process of starting a business in the UAE is one of the easiest and most accessible. Emirati authorities are continuously innovating to make it easier to start and run a business. There are more than 50 free zones in the UAE, and you can open a company in each.