DLS and Fred MIA

[CrazyPanda]

Business owners in the UAE need to wake up. The concept of zero-tax in the UAE is a thing of the past. I know that corporate service providers have misled you with false promises, but it’s time to face reality. You now have to pay corporate tax, high ongoing company costs (license fees, government fees, visa fees, PRO fees etc.) and extreme accounting fees. You need to also audit your financials every year to renew your business license.

 

[manukahoney]

It was never cheap. If you need a simple offshore - there are multiple options available, the only problem is they are mostly unbankable if you don't have some special relationships with the bankers.
Dubai was cost efficient for mid 6 - low 7 corp revenues and you also could get a local residency, non reportable personal bank accounts (as long as you reside in UAE) and have a working USD and EUR bank accounts for accepting payments.
Simple 1-person setup costs around 5k EUR annually to maintain now, plus around 1-4k EUR to submit all the audits (heavily depends of what kind of firm you chose, how many transactions you make etc). Plus you now pay corp tax on whatever profit you have, so there might be a few % put aside. Is it expensive? Maybe. Are there better options? Perhaps, but it works for SMB setups and I haven't found something better package-wise (corp + personal residence, quality of life, safety etc).

 

[Houdini]

Business owners in the UAE need to wake up. The concept of zero-tax in the UAE is a thing of the past. I know that corporate service providers have misled you with false promises, but it’s time to face reality. You now have to pay corporate tax, high ongoing company costs (license fees, government fees, visa fees, PRO fees etc.) and extreme accounting fees. You need to also audit your financials every year to renew your business license.

where does it belong to Fred and Mia ?

 

[CrazyPanda]

where does it belong to Fred and Mia ?

I don’t know Mia, but Fred has misled many people. He insisted that most business activities would be outside the scope of corporate tax. It seems he deleted his original post, but I managed to find a trace of it. Check below.

Claim: “You are only paying 9% Corporate Tax if you are running one of the Excluded Activities.”
Truth: You first need to check whether you are conducting a qualifying activity. If you are not conducting a qualifying activity, you will be subject to corporate tax regardless of whether you engage in excluded activities. Qualifying activities are very limited, such as financing, shipping, IP businesses, etc. Additionally, your company must be a ‘Qualifying Free Zone Person’, must earn ‘Qualifying Income’ and not engange any Excluded Activities to be eligible for the 0% tax rate.

Claim: “No matter if you are doing E-Commerce or Marketing Services - it’s a Qualifying Activity.”
Truth: Completely incorrect. E-commerce or marketing activities are not qualifying activities under UAE corporate tax law and subject to %9 corporate tax directly.


Here is another incorrect statement from DLS: "It’s important to understand that the Excluded List of Activities in regards to Qualifying Income for a Qualifying Freezone Person is a conclusively complete list and the Activities not mentioned thereby automatically belong to the List of Qualifying Activities to remain 0% Corporate Tax as described"

This is completely wrong and misleading statement. The UAE corporate tax law defines “Excluded Activities” that do not qualify for the 0% corporate tax rate for Free Zone Persons. Just because an activity is not on the Excluded Activities list does not make it a “Qualifying Activity” eligible for the 0% tax rate...

99% of Freezone Companies formed by DLS Dubai remain 0% Corporate Tax – Why?

From June 1, 2023, the UAE authorities have introduced a corporate income tax, for taxable individuals and companies with a tax rate of 9%. What does this mean for you?

dls-dubai.com

I have own 2 freezone UAE companies in the software business since 2019, with a turnover in the 8-figure range. We worked with the professional tax lawyers in Dubai to analyze the 0% free zone incentives, as our business is an IP business, which is a qualifying activity. After spending about $25,000 on legal fees, we decided to pay the 9% tax due to the complexity, reporting requirements and risks associated with trying to achieve 0% tax in the UAE.

 

[Houdini]

Thank you for explaining this. Now your post make more sense.

 

[Fred]

UPDATE FOR EXISTING DLS Dubai Clients:

All exiting clients receive in the next couple of days an Update E-Mail from IFZA so that you can perform again your Trade License Renewal with DLS Dubai and all benefits that come along with, including a FREE Personal Consultation Session of 1 hour with Fred along with the Trade License Renewal.

Further we handle your upcoming Trade License Renewal with our PRO Service and you enjoy our Residence Visa Free for Lifetime Promotion.

@CrazyPanda

I don’t know Mia, but Fred has misled many people. He insisted that most business activities would be outside the scope of corporate tax. It seems he deleted his original post, but I managed to find a trace of it. Check below.

View attachment 7783

Claim: “You are only paying 9% Corporate Tax if you are running one of the Excluded Activities.”
Truth: You first need to check whether you are conducting a qualifying activity. If you are not conducting a qualifying activity, you will be subject to corporate tax regardless of whether you engage in excluded activities. Qualifying activities are very limited, such as financing, shipping, IP businesses, etc. Additionally, your company must be a ‘Qualifying Free Zone Person’, must earn ‘Qualifying Income’ and not engange any Excluded Activities to be eligible for the 0% tax rate.

Claim: “No matter if you are doing E-Commerce or Marketing Services - it’s a Qualifying Activity.”
Truth: Completely incorrect. E-commerce or marketing activities are not qualifying activities under UAE corporate tax law and subject to %9 corporate tax directly.


Here is another incorrect statement from DLS: "It’s important to understand that the Excluded List of Activities in regards to Qualifying Income for a Qualifying Freezone Person is a conclusively complete list and the Activities not mentioned thereby automatically belong to the List of Qualifying Activities to remain 0% Corporate Tax as described"

This is completely wrong and misleading statement. The UAE corporate tax law defines “Excluded Activities” that do not qualify for the 0% corporate tax rate for Free Zone Persons. Just because an activity is not on the Excluded Activities list does not make it a “Qualifying Activity” eligible for the 0% tax rate...

99% of Freezone Companies formed by DLS Dubai remain 0% Corporate Tax – Why?

From June 1, 2023, the UAE authorities have introduced a corporate income tax, for taxable individuals and companies with a tax rate of 9%. What does this mean for you?

dls-dubai.com

I have own 2 freezone UAE companies in the software business since 2019, with a turnover in the 8-figure range. We worked with the professional tax lawyers in Dubai to analyze the 0% free zone incentives, as our business is an IP business, which is a qualifying activity. After spending about $25,000 on legal fees, we decided to pay the 9% tax due to the complexity, reporting requirements and risks associated with trying to achieve 0% tax in the UAE.

There is a reason why we paused the Business for more then 1 Year and didn't onboarded more then a handful of clients after 01.06.2023.

I received 100s of E-Mails from Forum Users, Existing Clients and Potential Clients seeking for clarifications, I spent way more then $25,000 to get ASAP clarification, back then the reality was that even the Big 4 were just Copy & Pasting from FTA Website and kept a low ball on any clarification to not burn themselves like I did at the end of the day. Post got deleted as it was not accurate.

I have no idea why you frame it like I did had bad intentions at any point and you could find a "trace" about my bad intentions. Your Argument doesn't make sense if you take into consideration that my "Misleading Information" was published just to close shop 1 Month later.

No bad feelings, I wish for everyone of you guys just the best.