Exploring the Tax Advantages of a RAK Freezone Company

Exploring the Tax Advantages of a RAK Freezone Company

A RAK (Ras Al Khaimah) Free Zone Company is a business entity established in one of the free

zones located in the emirate of Ras Al Khaimah, United Arab Emirates. These free zones offer a range of tax advantages and incentives to attract foreign investors and businesses. Here are some of the tax advantages associated with setting up

a RAK Freezone Company:

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Z e ro C o rporate T ax : One of the most

significant tax advantages of establishing a company in an RAK free zone is the absence of corporate income tax. This means that companies operating within the free zone are not subject to corporate

tax on their profits. This is a major incentive for businesses looking to expand in the region. •

1 0 0% F o reign O w nership : In many free zones in Ras Al Khaimah, foreign investors can have 100% ownership of

their companies. This is in contrast to the mainland of the UAE, where a local sponsor is typically required to have a majority stake in the company.

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•

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No I m por t or Ex por t Dut i es : RAK free

companies are usually allowed to repatriate 100% of

zone companies often enjoy exemptions

their profits and capital without any restrictions. This

from import and export duties on goods

means you can take your earnings out of the country

and services. This can significantly

without facing additional taxes or currency exchange

reduce the cost of doing business,

restrictions.

particularly if your business involves a

•

•

No Va l ue Added Ta x ( VAT) : While the UAE has

lot of international trade.

introduced VAT, certain free zones, including RAK

No Per s ona l I nc om e Ta x : The UAE does

free zones, may provide exemptions or reduced

not levy personal income tax on

rates for specific goods and services. This can lead

individuals, including expatriate

to cost savings for business es.

employees. This can make it attractive

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Ful l Repa t r i ation of Pr of i ts : RAK free zone

•

Fl ex i ble Lega l Fr a m ew or k : RAK free zones offer a

to skilled workers and professionals, as

flexible legal framework and simplified regulatory

they can retain a larger portion of their

procedur es for business setup, making it easier for

income.

companies to establish and operate.

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It's important to note that while RAK free zones offe r numerous tax advantages, there may still be certain fees and costs associated with setting up and operating a business in the free zone. Additionally, compliance with local regulations and laws is essential to maintain tax benefits and avoid potential legal issues.

Before establishing a RAK Free Zone Company or any business entity in the UAE, it is advisable to consult with legal and financial experts who specialize in UAE company formation to ensure that your specific business needs and objectives are met while complying with all re levant regulations. Tax laws and regulations can change, so staying upto-date with the latest developments is crucial for your business's success.

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