Ras Al Khaimah Company Structure
Legal basis - Although the UAE legal code is based on Sharia law and civil law, Ras Al Khaimah International Business Center is based on common law principles.
Legal framework - Regulations on Commercial Companies of the Ras Al Khaimah International Business Center 2016
Company form - International company (limited liability company) (LTD)
Responsibility - The liability of a shareholder towards the company is limited to any unpaid amount on a share held by the shareholder.
Trade restrictions - International companies may not do business with persons in the free zone, engage in any other activity which may, by regulations made by the Authority be prohibited by the Authority, carry on banking activities in the UAE or in the zone ; or operate as an insurance or reinsurance company, insurance agent or insurance broker in UAE or the free zone.
International companies may establish or maintain professional contacts with legal consultants, accountants, management companies or other similar persons operating in the free trade area; keep books and records in the free trade area, keep within the framework of the meetings of the UAE free trade area of its directors or members; hold a bank account in the RAK Free Trade Zone for the purpose of carrying out its day-to-day operational transactions; or hold assets in the zones of the free zone designated by the Authority.
Share capital - There is no minimum share capital requirement. The memorandum of a company limited by shares will state the maximum number of shares that the company is authorized to issue or an unlimited number of shares; the classes of shares that the company is authorized to issue and, if the company is authorized to issue two or more classes of shares, the rights, privileges, restrictions and conditions attached to each class of shares.
A company can issue shares with and without par value. A share of par value can be issued in any currency. The issue of fractional shares is also authorized. The company can issue free shares, partially paid-up shares or void shares. Bearer shares are not permitted.
Shareholders - The company can be formed by at least 1 shareholder, who can be an individual or a company, and can be non-resident. Contact details of shareholders are not disclosed in a public file.
Administrators - At least one director is required, who can be a natural person or a legal person, and can be non-resident. Details of directors are not being released on a public record.
Secretary - The appointment of a secretary is required, who can be a legal or natural person and can be non-resident.
Registered address - International companies must at all times have a registered agent, who has obtained a license to provide registered agent services by RAK ICC. A company must have a registered office in the UAE, provided that if the registered agent of the company has an office in the UAE, the registered office of the company is the office of its registered agent; or outside the UAE only with the approval of the Registrar.
General assembly - Annual general meetings are not compulsory and can be held anywhere. Meetings can be held by telephone or other electronic means; directors and shareholders can also vote by proxy.
Electronic signature - authorized.
Re-domiciliation - A foreign entity can continue as a RAK ICC, and vice versa.
Conformity - International companies must prepare annual accounts, but there is no obligation to file them, nor annual declaration, nor taxa declaration, to any authority. Audits are not required except for liquidation.
International companies are subject to an annual government tax.
Key figures of Ras Al Khaimah companies
Ras Al Khaimah, one of the seven members of the United Arab Emirates, is developing quietly, far from the excess of “bubbles”. One hour by highway from Dubai, the emirate is attracting growing interest from foreign companies.
Ras al Khaïmah is the fourth largest emirate in the country.
It is part of what is called the Northern Emirates.
Name of the leader (current emir): Sheikh Saud bin Saqr al Qasimi (since October 2010)
Number of inhabitants : Around 200,000
Key sectors in Ras Al Khaimah
Ras al Khaimah has seen an increase in tourism, particularly from Germany, Russia, UK and India. In this sense, the emirate is increasingly establishing itself as a destination for leisure and adventure. It should be noted that agriculture and fishing also contribute significantly to the local economy. Finally, the production of building materials (for export), manufacturing, high technology, real estate, insurance and banking services are key sectors, generating jobs.
Ras Al Khaimah currently has 7,500 companies from over 100 countries. The main sectors are tourism, petroleum, real estate, manufacturing, technology, agriculture and fishing.
The development of the free zone has also taken off in recent years, promoting job creation in the region. This is mainly due to the country's economic growth and the tax benefits it offers.
Ras Al Khaimah Corporate Taxation
When talking about the Emirate of Ras Al-Khaimah in the United Arab Emirates, it should be noted that it is not as famous as neighboring Dubai and Abu Dhabi, but certainly no less attractive to international companies and investors. potential foreigners. This is due to a favorable geographical location, which gives access to the markets of the Middle East, India, Africa and other regions.
The economy of Ras Al-Khaimah is growing rapidly due to industries such as manufacturing, financial services sector, construction, real estate, and tourism industry. The investment climate of the emirate is recognized by international experts as the most favorable. Thus, according to the international publication FDI Magazine, Ras Al-Khaimah has been recognized as the best place for foreign direct investment.
Ras Al-Khaimah's law excludes concepts such as corporate taxes, income taxes, value added taxes, dividend and capital gains taxes. The registration of companies in specialized economic zones allows a participation of 100% of foreign nationals as shareholders and owners of the company. There are no restrictions on the repatriation of capital, as well as exchange controls, quotas and trade barriers.
Ras Al-Khaimah - particular aspects of tax jurisdiction
If we compare the tax jurisdiction of Ras Al-Khaimah with other similar tax havens, it is possible to identify some differences. UAE has its own specificities, taxes have never been applied here. These are the main differences in attitude towards business in the UAE. Government budgetary revenues come mainly from products of the oil and gas sector and other sources, but not at the expense of corporate taxation.
The oil and gas sector has enabled rapid development of the economy, simultaneously developing other economic sectors, especially international trade and tourism. Nowadays, the investment climate in Ras Al-Khaimah attracts considerable foreign investment in the local economy and is the main driver of it. In fact, UAE tax laws and regulations are of a recommendatory nature except for the banking, oil and gas industries. In addition, state recommendations on tax planning are not applied to special economic zones. In particular, unique business opportunities are open to companies incorporated in the Ras Al-Khaimah Specialized Economic Zone.
Ras Al-Khaimah FTZ - features and benefits
Ras Al-Khaimah Free Trade Zone - is a government project designed to provide a favorable investment climate for foreign businessmen. The procedure for incorporating a company in the territory of a specialized area is simple. Both offshore and onshore companies can integrate into it, which is useful for building profitable business projects.
The main advantage of integration into the economic free trade zone is a complete exemption from tax payments in the event of foreign participation in 100%.
It is worth mentioning a relatively low threshold for import duties and its complete absence for most product groups. Local currency - The dirham is pegged to the dollar and is freely convertible into any other currency.
Ras Al -Khaimah - fiscal policy of the emirate
The benefits of tax planning in this region are available not only to business representatives and foreign investors. A fair and liberal tax policy also applies to businesses and individuals. Thus, the tax policy excludes personal income tax and makes the emirate attractive to foreign professionals and skilled workers.
It should be taken into account that the direct tax system is in contradiction with the traditional tax policy of the UAE. Despite the federal form of the country, here you will not find federal taxation here.
In addition to the benefits already mentioned, foreign nationals can acquire ownership of real estate in Ras Al-Khaimah, which is also tax exempt.
International tax planning
The emirate of Ras Al-Khaimah is increasingly seen by foreign businessmen as the opportunity for effective tax planning. The UAE government has a number of international agreements ratified to avoid double taxation, which significantly reduces tax payments in relevant jurisdictions.
Bilateral international agreements have been concluded by Ras Al-Khaimah with the following countries: Canada, Australia, France, Italy, Germany, Romania, Poland, Czech Republic, Finland, Egypt, India, Lebanon, Indonesia, Malaysia, Morocco, Malta, New Zealand, Singapore, Thailand, Pakistan, Sudan, Belarus, Ukraine, Turkey and Tunisia.
Ras Al-Khaimah - Taxation of offshore companies
Offshore companies incorporated in the RAK Free Trade Area have the following advantages:
- 100% exemption from withholding tax;
- No value added tax;
- No capital gains tax;
- Dividends are taxed only in the territory of the State where they are distributed;
- Royalty income is taxed only in the territory of the State where it is collected;
- The same applies to the taxation of accrued interest;
- No tax, which is formed by regular deductions from wages;
- No repatriation costs for financial assets;
- Offshore companies are totally exempt from export and import duties.
Jurisdiction of Ras Al-Khaimah at the international level
Internationally, the RAK has acquired a solid reputation as a transparent and tax-free jurisdiction. It is important to note that the legal practice of the emirate excludes illegal schemes and the possibilities of “money laundering”.
International experts recognize that tax planning opportunities are the main factors attracting foreign nationals to come to live and work here.