uae llc or sole establishment

[ShillGates]

UAE llc = limited liability
UAE llc with one member = sole establishment (therefore not llc) = unlimited liability

which one is better? since you dont require a sponsor tfor the latter.....

 

[CaptK]

There isn't much difference apart from the sponsor as liability in the UAE is on you regardless of company or sole establishment.

 

[ShillGates]

Double tax treaty wise - should people (most most likely) not spend enought time in UAE

You receive dividends from a company, like a LTD.

How is a llc different? No dividends but profit distribution

How is a sole establishment treated- like income you received directly as if you are self employed?


For example if you live in Cyprus, LTD dividends are tax exempt if non-dom. In Cyprus, (ignoring the management and control issue etc... for a minute) how would the taxman regard these entities? As a LTD? Partnership? or Selfemployed?

 

[ShillGates]

Its the same question for all people who got a USA LLC in effect.

HOw are the LLC's treated. Single member LLC in USA is being disregarded, how does that end up on your personal tax form? Dividends or some other form of income which messes it up?

 

[CaptK]

OffMyBack said:
Double tax treaty wise - should people (most most likely) not spend enought time in UAE

You receive dividends from a company, like a LTD.
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Then you will have some explaining to do if you get caught. If you follow the rules of establishment and the UAE government have helped by introducing substance requirements for everyone regardless of the type of company.

OffMyBack said:
How is a llc different? No dividends but profit distribution
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Yes profits there are no dividends because no tax is applicable.

OffMyBack said:
How is a sole establishment treated- like income you received directly as if you are self employed?
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Just the same as an LLC

OffMyBack said:
For example if you live in Cyprus, LTD dividends are tax exempt if non-dom. In Cyprus, (ignoring the management and control issue etc... for a minute) how would the taxman regard these entities? As a LTD? Partnership? or Selfemployed?
Click to expand...

Could either be salary or self employed but they are both taxed the same.

 

[ShillGates]

Sorry maybe i made myself misunderstood.

In cyprus Dividends are exempt from income if coming from abroad (or inside Cyprus if nondom exemption certificate).

So if i were to be a partner in an LLC. And that llc got profit - what is that type of income? Dividends or profit distribution or normal income?

If i have a sole establishment, then what is that income?

 

[CaptK]

OffMyBack said:
Sorry maybe i made myself misunderstood.

In cyprus Dividends are exempt from income if coming from abroad (or inside Cyprus if nondom exemption certificate).

So if i were to be a partner in an LLC. And that llc got profit - what is that type of income? Dividends or profit distribution or normal income?

If i have a sole establishment, then what is that income?
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You can dress it up as dividends but that would mean you would need to do account's to show how the dividends were derived.

 

[ShillGates]

https://www.contractoruk.com/successful_contracting/what_about_dividends_and_llps.html
I would disagree, Its not about you choosing what it is(or dressing up ). What I am trying to ascertain is what it should be.

Limited Liability Partnerships (LLPs) don't pay dividends. Instead, members are taxed on their share of the profit of the LLP, in broadly the same way as individual sole traders ”“ in other words they are taxed on what they earn, not on what they draw out.

Most importantly, LLCs do not have to pay taxes. Instead, their profits and losses are passed through to their members' individual tax returns in the same way as a partnership.

LLC is a similar setup - sole establishment and llc are pass through rather than a company in same sense of things (Inc.)

An llc doesnt seem to be able to have retained earnings, ie no distribution, it seems to be pass through on to income of the members?

So to put it simply - If I incorporate in HK - and make 10 Million EUro profit, the shareholders only receive money once the directors of that company decide to distribute to shareholders. Likewise in UK, Cyprus and other countries in EUrope. This does not seem to be the case of an LLC

unless someone can point out it is the case?

 

[startfleetio]

OffMyBack said:
https://www.contractoruk.com/successful_contracting/what_about_dividends_and_llps.html
I would disagree, Its not about you choosing what it is(or dressing up ). What I am trying to ascertain is what it should be.

Limited Liability Partnerships (LLPs) don't pay dividends. Instead, members are taxed on their share of the profit of the LLP, in broadly the same way as individual sole traders ”“ in other words they are taxed on what they earn, not on what they draw out.

Most importantly, LLCs do not have to pay taxes. Instead, their profits and losses are passed through to their members' individual tax returns in the same way as a partnership.

LLC is a similar setup - sole establishment and llc are pass through rather than a company in same sense of things (Inc.)

An llc doesnt seem to be able to have retained earnings, ie no distribution, it seems to be pass through on to income of the members?

So to put it simply - If I incorporate in HK - and make 10 Million EUro profit, the shareholders only receive money once the directors of that company decide to distribute to shareholders. Likewise in UK, Cyprus and other countries in EUrope. This does not seem to be the case of an LLC

unless someone can point out it is the case?
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A lot of jurisdictions like UK and Canada see the Profits from LLCs as dividends. They treat LLCs as a opaque entity instead of a transparent entity.

 

[Marzio]

startfleetio said:
A lot of jurisdictions like UK and Canada see the Profits from LLCs as dividends.
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Does this mean that a BC LLP that has a US LLC as a partner will treat the US LLC like a UK LTD (capital company)?