Dubai company tax reduction via salary

[Henn and Rich]

to be fair, it will take a while before they start bothering you I feel.‌ The UAE is not some time-honored jurisdiction with an established tax man in place. It‍ has just been implemented and will take a while before the tax man would catch⁠ you for not paying 9% in accordance to the corporate tax laws. So I do⁤ believe some creative accounting can help you increase your costs and reduce taxable profit.

Of course taking all your revenue and paying it out as 1 big salary to the⁣ sole owner of the company would not fly through 😀 maybe for now yes, but I⁢ am sure years down the line they will catch this and impose a nice fat︀ fine.

 

[Martin Everson]

It means a salary way in excess of market⁣ averages/ranges for the duty being performed and which results in the corporate tax base being⁢ eroded will cause you issues. The UAE may decide to penalize you,tax you anyway or︀ both. You need to check what the punishment is before even contemplating doing something you︁ KNOW is morally wrong.

 

[Fred]

Covered this here in our latest Blog Article as well:

https://dls-dubai.com/en/99-of-free...bai-remain-0-corporate-tax-why/#reading-start

 

[Sigma]

People work remotely. If you pay salaries it doesn’t mean the the person is working⁢ from the UAE.

 

[JustAnotherNomad]

That's not how it works.
If you‍ live in a typical Western country, you can't just register your company in the BVI,⁠ travel around the world five days a week, working remotely, and not pay tax.
"I was only at home in my apartment for the weekend, I didn't work during that⁤ time!"
It's just not how it works. If the company doesn't have a fixed office⁣ elsewhere, your home will be considered the base of operations.
The UAE is pretty much⁢ the same now - on paper. Obviously it's highly unlikely that they will be anywhere︀ near this strict in the near future, but they have the legal framework in place︁ to do that.

 

[Sigma]

Care to elaborate on possibilities?