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- Ras Al Khaimah Forms of Offshore
Operation
- Ras Al Khaimah Tax Treatment
of Offshore Operations
- Ras Al Khaimah Taxation of
Foreign Employees of Offshore Operations
- Ras Al Khaimah Exchange
Control
- Ras Al Khaimah Employment
and Residence
Although Ras Al Khaimah is a 'no-tax' jurisdiction,
ownership restrictions on companies in the normal
economy mean that the Ras Al Khaimah Free Trade
Zone (RAK FTZ) or the Ras Al Khaimah Investment
Authority (RAKIA) offshore companies registry
are the key locations offering an 'offshore' option
to foreign operators. Operations inside the Free
Zones can be carried out under various different
types of license, but most often a foreign company
will use a ‘Free Zone Company’ or
a 'Free Zone Establishment'.
Ras Al Khaimah Forms of Offshore Operation
Free Zone Licensees are not permitted to display
or sell their products or services themselves
directly in the local market. However, the holder
is permitted to operate outside the UAE. Retail
trading is not allowed inside the Free Zone Parks.
A Free Zone Company (FZCO) is a limited liability
company incorporated with RAK Investment Authority,
by more than one shareholder with a distinct legal
entity and independent financial liability. The
Capital requirement for setting up FZCO with RAK
Investment Authority Free Zone is AED250,000.
A Free Zone Establishment (FZE) is 100 per cent
owned by either a person or a corporate body.
It enjoys the status of a separate legal entity.
The Capital requirement for setting up a FZE with
RAK Investment Authority Free Zone is AED 150,000.
Local or UAE Branch Licences are issued to companies
holding a valid licence from any UAE licencing
authority except from other free zones.
Foreign Branch Licences are issued to companies
outside the UAE seeking to open a branch in the
RAK Investment Authority Free Zone. The ownership
of the company must be 100% foreign and sales
can be made through a UAE-registered agent or
a distributor only. The activity may be industrial,
commercial or professional/services-based.
RAK Free Zone companies must obtain one of the
following types of licences:
- An Industrial Licence allows the holder to
import raw materials in addition to manufacturing,
processing, assembling, packaging, and exporting
finished products.
- A Commercial Licence allows the import, export,
distribution, consolidation, storage or warehousing
of items specified in the licence.
- A Consulting and Services Licence allows the
holder to offer consulting services in management,
finance, investment, legal issues, labour relations,
economics (including feasibility studies), industrial
development, marketing, and related subjects.
Other services include logistical support such
as: restaurants or food outlets, catering services,
travel agencies, leisure and social activities,
insurance, cargo and freight forwarding, accounting,
and audition services.
- A Commercial – General Trading Licence
can be obtained under a Commercial License,
which allows for more than seven product lines.
Please see Types of Company for more details
on the company forms available in Ras Al Khaimah.
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Ras Al Khaimah Tax Treatment of Offshore Operations
Amongst the incentives offered to companies operating
within the Ras Al Khamah Free Trade Zone are:
- No corporate or income taxes imposed
- No import or export taxes
- No sales or wealth taxes
- 100% foreign ownership of businesses
- 100% repatriation of capital and profits
- Concessional rates on land leases
RAKIA offshore companies also pay no tax whatsoever
except for incorporation and annual registration
fees. For RAKIA Offshore companies there are no
restrictions on the number of shareholders or
directors, and they are under no obligation to
hold an annual meeting or to file audited accounts.
RAKIA offshore companies cannot conduct business
locally except with those supplying accounting,
audit, legal and banking services, and staff cannot
be employed locally.
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Ras Al Khaimah Taxation of Foreign Employees
of Offshore Operations
No personal income tax is deducted from wages
and salaries paid to employees or on other income
earned. See Domestic Personal Taxes for
the general principles of individual taxation
(or lack of it) in Ras Al Khaimah, which also
apply to the resident employees of offshore entities.
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Ras Al Khaimah Exchange Controls
There are no exchange controls in Ras Al Khaimah.
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Ras Al Khaimah Employment & Residence
There are no restrictions on the employment of
foreign nationals in Ras Al Kaimah, although the
UAE authorities are keen to see more local participation
in the workforce through a policy of emiritisation.
The easiest and fastest way to set up a new business
in the UAE is through a free trade zone. Otherwise,
it is a mandatory requirement to register a new
company’s name with the Immigration Department
and the Ministry of Labour and Social Affairs.
Since most companies recruit their employees from
abroad, they need to register a file at the Ministry
of Labour and Social Affairs and Immigration Department
once they have received their trade licence.
Without registering with both of these departments
a business cannot employ its staff. Upon registering,
the company shall be issued an ‘Establishment/Labour
Card’ by the Ministry of Labour and Social
Affairs. An ‘Establishment/Immigration Card’
can be issued by the Immigration Department.
A contract with the new employer and/or sponsor
has to be signed before the application for a
work/residency visa is submitted to the relevant
authority. A medical check and fingerprinting
have to be undertaken before a visa can be issued.
RAK Free Trade Zone provides visa sponsorship
to licensed clients so they can operate a business
in the UAE. The number of visas that can be issued
to a company is dependent on the scale of operation,
type and size of facility, type of licence and
activity undertaken. Commercial and Consultancy
Licences can apply for up to four visas. For Industrial
Licences, the number of visas is to be decided
as per project requirements. There are different
types of visas for which RAK FTZ clients can apply,
depending upon their individual requirements and
eligibility criteria.
The following four types of visa are available
in the RAK FTZ:
- Investors or Partner Employment Visa: This
is issued to a RAK FTZ Establishment owner (Investor
Visa) or to a shareholder / partner in a RAK
Free Zone Company where the value of shares
held by the applicant is not less than AED 50,000
(Partner Visa). This type of visa is normally
valid for three years; the visa holder is not
allowed to stay outside the UAE for more than
six consecutive months. Investors / shareholders
/ partners who wish to sponsor their families
need to have a minimum shareholding of AED 75,000.
There is no upper age limit stipulated for Investor
or Partner Visa applicants.
- Manager Employment Visa: This visa is issued
to managers or employees of companies established
at RAK FTZ, falling within the age group of
20 - 60 years. This type of visa is normally
valid for three years, but the visa holder must
not stay outside the UAE for more than six consecutive
months.
- Family Visa: Males already holding Employment
Visas issued by RAK FTZ may apply for Family
Visas to sponsor their dependents. This type
of visa is normally valid for three years.
- Visit Visa: This is a permit to enter the
UAE for short periods of time and is either
valid for 30 days or for 90 days, depending
on the visa type applied for.
Visa applications and approvals are subject
to change without notice and are governed by
the rules and regulations of RAK FTZ and the
RAK Immigration Authority.
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