Latest / GENZONE / New 9% Tax in Dubai Explained?! | GenZone Podcast (Who Has To Pay)

Transcript

New 9% Tax in Dubai Explained?! | GenZone Podcast (Who Has To Pay) · GENZONE

• 0:00
  SPEAKER_00: This year in 2023, Dubai introduced a new corporate tax that will be applied to businesses, and in 2024 it's gonna take effect.
• 0:08
  SPEAKER_00: Now, all businesses have to register for corporate tax.
• 0:12
  SPEAKER_00: No matter if you have to pay it or not, you have to register for corporate tax.
• 0:17
  SPEAKER_00: However, some people are talking about well, this company might not have to pay it, and this one might have to pay it.
• 0:23
  SPEAKER_00: Or if you're in a free zone, you don't have to pay it.
• 0:25
  SPEAKER_00: So I'm gonna clear it up for once so that everyone can know exactly what is going on in Dubai starting in 2024.
• 0:32
  SPEAKER_00: And I'll be going over specifically free zone companies because that's what most people are setting up.
• 0:36
  SPEAKER_00: If you're watching this video, you probably want to set up a free zone company, and that's exactly what we support with as well.
• 0:42
  SPEAKER_00: Of course, we support with mainland companies, but 99% of our clients set up free zone companies in the UAE.
• 0:48
  SPEAKER_00: And if you're confused or don't know how to properly set up a company here in Dubai because you've never done it before, then let us take care of that for you.
• 0:54
  SPEAKER_00: Book a call down below, and we would be more than happy to get on a consultation call and set up your business with you.
• 0:59
  SPEAKER_00: And when I say with you, I mean for you because our service is a totally done-for-you VIP service where you don't have to do anything, we take care of everything for you and make sure it's done properly the first time.
• 1:09
  SPEAKER_00: So the first thing you need to know is qualifying income.
• 1:11
  SPEAKER_00: Now, qualifying income is income that qualifies to not be subject to the corporate tax.
• 1:17
  SPEAKER_00: So if someone says that X is a qualifying income activity, it means that there will be no corporate tax applied to X.
• 1:23
  SPEAKER_00: So let's go over these qualifying activities.
• 1:26
  SPEAKER_00: And if your activity is not on the list, then you will have to pay this 9% corporate tax, which is on net income above roughly 102,000 US dollars or 375,000 Durham.
• 1:37
  SPEAKER_00: So again, to make it clear, let's say your company makes$300,000 and then you have$200,000 worth of expenses and your net income is$100,000.
• 1:46
  SPEAKER_00: Well, there is no corporate tax you know attributable to your company.
• 1:50
  SPEAKER_00: And this also resets for the next year as well.
• 1:52
  SPEAKER_00: So that$100k doesn't move forward to the next year, it resets to zero.
• 1:56
  SPEAKER_00: So that's what you need to keep in mind.
• 1:57
  SPEAKER_00: So starting off a manufacturing of goods or materials, B processing of goods or materials, C trading of qualifying commodities, D holding shares and other securities for investment purposes, E ownership, management and operation of ships, F reinsurance services, G Fund Management Services, H wealth and Investment Management Services, I Headquarters Services to Related Parties, J Treasury and Financing Services to Related Parties, K Financing and Leasing of Aircrafts, L.
• 2:42
  SPEAKER_00: Distribution of Goods or Mirs in or from a designated zone, M.
• 2:48
  SPEAKER_00: Logistics Services.
• 2:49
  SPEAKER_00: I had a client that had a big portfolio of stocks, cryptos, and other assets and asked me, Kevin, if I had these in my company, would I have to pay a corporate tax?
• 3:00
  SPEAKER_00: Now it's very important to note that according to this document, the answer is no.
• 3:05
  SPEAKER_00: However, this says holding of shares.
• 3:09
  SPEAKER_00: If you are not holding, but you are trading actively, buying and selling, then in that case, that is a different situation.
• 3:16
  SPEAKER_00: You are not only holding, but you are trading.
• 3:18
  SPEAKER_00: So if you are trading, then in that case, you will have to pay that corporate tax.
• 3:22
  SPEAKER_00: But it's also really important to note that here in Dubai, if you set up a company and get residency here, you can 100% invest trade in your personal name.
• 3:31
  SPEAKER_00: It does not have to be in a company.
• 3:33
  SPEAKER_00: So if you're trading in your personal name, whether it's crypto, stocks, mutual funds, whatever it is, this will be taxed at 0% at the moment.
• 3:42
  SPEAKER_00: And for the next four or five years, we all expect it to remain the same.
• 3:45
  SPEAKER_00: So hopefully this cleared it up for you.
• 3:47
  SPEAKER_00: And if you want to set up your business in Dubai, book a call with us down below, and we would be more than happy to assist you.
• 3:52
  SPEAKER_00: Get set up here.