Again, he will NOT be a UAE resident. He will be living in UK. Thats the whole point of his post? Did you not read it correctly. He will not be in UAE. So that reporting will affect him as a non-UAE resident unless he meets ESR.
Tax residency in UK
- Thread starter rdevalex
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And this can be avoided by just keeping his current Visa and Emirates ID and flying in once every 6 months.
Again I get your point but it takes almost nothing to keep the UAE paper residence to not get reported.
I'm a bit surprised about the one dimensional view of things on this from your side as you know very well someone can have multiple residence.︀
Again I get your point but it takes almost nothing to keep the UAE paper residence to not get reported.
I'm a bit surprised about the one dimensional view of things on this from your side as you know very well someone can have multiple residence.︀
Look at what he wrote below. Are you suggesting he don't say anything to UAE when he moves to UK?
I am stating facts. He can have as︀ many residencies as he wants and even multiple tax residencies...good luck with that.
I am stating facts. He can have as︀ many residencies as he wants and even multiple tax residencies...good luck with that.
Yes of course - technically he can't even say anything to the UAE beside of cancelling his current Residence Visa which I don't recommend him with a good past history in the UAE.
The whole forum here is about privacy and reducing taxes and such articles like the one earlier mentioned are just misleading people here and ruining opportunities.
Yes - when you do setup a RAKICC non-resident Offshore Company in the UAE in 2023 the earlier mentioned article is right - no one with a Brain is doing so in 2023 as the︀ issue is not the reporting in first place but not getting any Business Bank Account︁ opened.
The OP clearly asks if he should pay himself in the UAE which indicates︂ he still have his local UAE Bank Accounts which again indicates he intends to keep︃ his UAE Residence Visa anyway as otherwise this accounts would be shut down.
You know︄ all this Martin - you claimed here once Citibank UAE did shut down your non-resident︅ account already couple of years ago - when it comes to UAE we should aknowledge︆ the ease of having and maintaining the Residence Visa - at least on the paper.︇ So by just keeping what OP has already in place currently the whole article about︈ 12 Countries starting non-resident Companies becomes irrelevant at least in regards to the UAE.
The whole forum here is about privacy and reducing taxes and such articles like the one earlier mentioned are just misleading people here and ruining opportunities.
Yes - when you do setup a RAKICC non-resident Offshore Company in the UAE in 2023 the earlier mentioned article is right - no one with a Brain is doing so in 2023 as the︀ issue is not the reporting in first place but not getting any Business Bank Account︁ opened.
The OP clearly asks if he should pay himself in the UAE which indicates︂ he still have his local UAE Bank Accounts which again indicates he intends to keep︃ his UAE Residence Visa anyway as otherwise this accounts would be shut down.
You know︄ all this Martin - you claimed here once Citibank UAE did shut down your non-resident︅ account already couple of years ago - when it comes to UAE we should aknowledge︆ the ease of having and maintaining the Residence Visa - at least on the paper.︇ So by just keeping what OP has already in place currently the whole article about︈ 12 Countries starting non-resident Companies becomes irrelevant at least in regards to the UAE.
He can keep his residency but it will not help him tax wise but complicate it. If he is managing and controlling the UAE company from UK as a one man band his company will have not meet ESR in UAE. Hence why he asks the below in regards to the UAE company. Any suggestion to not say anything to UAE side is not a good idea hence why he was suggesting the below.
We have literally gone full circle. My original reply about doing things at arms length and meeting UAE ESR requirements is correct actions to take. Read my reply again I posted︀ here:
You can read more about UAE︈ ESR below:
https://kpmg.com/ae/en/home/service...conomic-substance-regulations-in-the-uae.html
https://mof.gov.ae/economic-substance-regulations/
P.S If anyone wants to follow the philosophy of "don't worry︉ no one is checking this and that in UAE". I wish them good luck. As︊ I always say I let people learn the hard way.
We have literally gone full circle. My original reply about doing things at arms length and meeting UAE ESR requirements is correct actions to take. Read my reply again I posted︀ here:
You can read more about UAE︈ ESR below:
https://kpmg.com/ae/en/home/service...conomic-substance-regulations-in-the-uae.html
https://mof.gov.ae/economic-substance-regulations/
P.S If anyone wants to follow the philosophy of "don't worry︉ no one is checking this and that in UAE". I wish them good luck. As︊ I always say I let people learn the hard way.
Some update for my case. We have relocated to UK and have plans to stay here at least for 1-2 years. So, I am already a UK tax resident with the non-dom status. I still own UAE FZE company which sells an Android mobile application on Google Play (in-app purchases and subscriptions). This company has an office, a bank account in UAE and I appointed a local director who manages the company in UAE. The company doesn't have any other employees because there is no active development at the moment (the latest version was released several months ago). So, I am just a passive investor︀ who owns a foreign company but doesn't manage it and doesn't perform any work to︁ not trigger PE in UK. Also, I don't remit any funds to UK other than︂ clean capital.
Now, I would like to resume the app development. Ideally, I want to︃ continue to develop the app myself in UK without hiring some other developers or outsourcing︄ to a third party company. Obviously, there is a risk of triggering PE in UK.︅ I was advised to open UK company and work as a contractor for UAE company.︆ But it would be desirable to have some other clients except my UAE company to︇ minimize the risk of PE triggering. Also, I am considering the option of opening a︈ subsidiary company in UK for development purposes, so the owner of such UK company would︉ be not me but my UAE company. Then I would work in this UK company︊ as a developer. It is like some big IT companies have headquarter offices in US︋ or UK and development centers in Eastern Europe. I am not sure about PE risks︌ and tax obligations in this case but I think such IT companies don’t pay big︍ taxes in countries where their development centers are located. I can always hire a developer︎ in UAE or outsource the development but it would be less preferable for me. What️ would be your advice regarding this?
The next question is about my UAE company. After UAE introduced CIT 9%, I have doubts whether I should stay with it or improve my setup somehow. 9% is not a big number compared with most countries but for IT companies there are a lot of tax regimes that allow to pay less. For example, I think about Cyprus IP Box regime, but it requires that development has to be carried out by Cyprus company itself or by an independent outsource company. Also, I think about a manager-managed US LLC, but there is a problem with the manager residency.︀ As I understand, the manager should live in some tax-free country like Bahrain, for example,︁ and it will be difficult to fund such a person. I thought that US LLC’s︂ manager can live in UAE and I would pay 9% CIT in UAE because such︃ US LLC will be a UAE tax resident, but at least I can use US︄ LLC for Stripe payments if I decide to integrate it. As I know, Stripe fees︅ in UAE are bigger. Does it make sense to make such US LLC a subsidiary︆ company owned by UAE company or UAE company is no longer needed in such setup?︇ Maybe, there are some other options?
Now, I would like to resume the app development. Ideally, I want to︃ continue to develop the app myself in UK without hiring some other developers or outsourcing︄ to a third party company. Obviously, there is a risk of triggering PE in UK.︅ I was advised to open UK company and work as a contractor for UAE company.︆ But it would be desirable to have some other clients except my UAE company to︇ minimize the risk of PE triggering. Also, I am considering the option of opening a︈ subsidiary company in UK for development purposes, so the owner of such UK company would︉ be not me but my UAE company. Then I would work in this UK company︊ as a developer. It is like some big IT companies have headquarter offices in US︋ or UK and development centers in Eastern Europe. I am not sure about PE risks︌ and tax obligations in this case but I think such IT companies don’t pay big︍ taxes in countries where their development centers are located. I can always hire a developer︎ in UAE or outsource the development but it would be less preferable for me. What️ would be your advice regarding this?
The next question is about my UAE company. After UAE introduced CIT 9%, I have doubts whether I should stay with it or improve my setup somehow. 9% is not a big number compared with most countries but for IT companies there are a lot of tax regimes that allow to pay less. For example, I think about Cyprus IP Box regime, but it requires that development has to be carried out by Cyprus company itself or by an independent outsource company. Also, I think about a manager-managed US LLC, but there is a problem with the manager residency.︀ As I understand, the manager should live in some tax-free country like Bahrain, for example,︁ and it will be difficult to fund such a person. I thought that US LLC’s︂ manager can live in UAE and I would pay 9% CIT in UAE because such︃ US LLC will be a UAE tax resident, but at least I can use US︄ LLC for Stripe payments if I decide to integrate it. As I know, Stripe fees︅ in UAE are bigger. Does it make sense to make such US LLC a subsidiary︆ company owned by UAE company or UAE company is no longer needed in such setup?︇ Maybe, there are some other options?
AFAIK you must use Google Play’s billing system for your in app purchases or subscriptions and pay the 15% service fee for revenues < 1mln
https://support.google.com/googleplay/android-developer/answer/112622?sjid=3144204682983930819-EU
https://support.google.com/googleplay/android-developer/answer/112622?sjid=3144204682983930819-EU
It is true when you allow to unlock Premium features from the app itself. It is not allowed to redirect a user to your website to proceed with payment. You must use Google Play billing in this case. But if your Premum funcltionality is linked to user accounts, you can allow to unlock it on the website even before a user install the app. Obviously, a user should know that there is possibility to unlock︀ Premium via website. It is not allowed to advertise this in an app. Something like︁ Plex Pass works.
Before answering about the best setup for your case, are you 100% you are not paying 30% US WHT for your app subscriptions?
This guy from Romania sells subscriptions as you and Google is asking him to fill his tax informations.
https://money.stackexchange.com/questions/142019/google-play-console-fill-tax-information
Did you ever file tax informations in your Google account?
That info is crucial to know because US and UAE don't have a double tax treaty in place.
This guy from Romania sells subscriptions as you and Google is asking him to fill his tax informations.
https://money.stackexchange.com/questions/142019/google-play-console-fill-tax-information
Did you ever file tax informations in your Google account?
That info is crucial to know because US and UAE don't have a double tax treaty in place.
Yes, I have submitted W-8BEN-E form. I am pretty sure Google doesn't deduct US withholding tax from in-app purchases and subscriptions in Google Play. I just have found "Consolidated Withholding Tax Information Statement" report in Google Play console and I see deductions of the withholding tax for such countries like Taiwan, Brazil, Egypt and some other, but there is no US among them.
Consider the next structure:
- I am non-dom UK resident and don't remit any funds to UK
- I have a manager-managed US LLC that sells a mobile app on Google Play and on a website via Stripe
- The manager of US LLC is UAE resident and he visits Bahrain 1-2 times per year to make strategic decisions for US LLC
- US LLC outsources the app development to some non-US company or opens a development subsidiary company in UK
What tax obligations would be in this case for US LLC? Should it pay some royalty withholding taxes?
- I am non-dom UK resident and don't remit any funds to UK
- I have a manager-managed US LLC that sells a mobile app on Google Play and on a website via Stripe
- The manager of US LLC is UAE resident and he visits Bahrain 1-2 times per year to make strategic decisions for US LLC
- US LLC outsources the app development to some non-US company or opens a development subsidiary company in UK
What tax obligations would be in this case for US LLC? Should it pay some royalty withholding taxes?
If UAE accepts that management is taking place outide UAE then your setup could be tax free but i guess it will be somewhat diffcult to prove that all business decisions are taken outside UAE if the manager only leaves 2 times per year.
If you are 100% sure you didn't pay US WHT on royalties till now (which is strange imho) then you will continue to not pay US WHT.
If you are 100% sure you didn't pay US WHT on royalties till now (which is strange imho) then you will continue to not pay US WHT.
Do I understand correctly that a permanent establishment will be triggered due to a fixed place of management in that country? What taxes should pay such PE in that country, if all actual work (product management and development) is outsourced to some third country?
If there's a PE in that country then company is liable to that country's CIT.
You can outsource everything but at some point somebody will have to take some decision and where that decision is taking place is where the company will be considered tax resident.
You can outsource everything but at some point somebody will have to take some decision and where that decision is taking place is where the company will be considered tax resident.
What profit is liable to country's CIT where PE is triggered? Profit from all app sales or from app sales in that country?
So, should US LLC pay CIT in this case despite such US LLC is treated as a transparent entity in a country where a manager taking︀ decisions is a resident?
So, should US LLC pay CIT in this case despite such US LLC is treated as a transparent entity in a country where a manager taking︀ decisions is a resident?
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