In this article, we would like to draw the attention of entrepreneurs to several jurisdictions that are especially popular when it comes to starting a business. Walton Consultants DMCC is a company that provides assistance in a wide range of legal and corporate services. Why are these countries attractive for business?
Any business wants to get the maximum benefit at the lowest cost. Each time we talk about this, the term “offshore” appears before our eyes as a synonym for a simple and easy way to do business in certain countries. Recently, this term has been accompanied by some negative connotation. However, in fact, the creation of an offshore zone is an attempt by a state to attract foreign investment by deliberately simplifying registration formalities and reducing the tax burden.
What is the difference between Estonia, Cyprus and the UAE from other countries?
In the post-Soviet space, the system of offshore zones is still in its infancy, but there are some states in the world that have established themselves as a suitable platform for doing business. As a rule, these are states with a stable economy, a stable political situation and a strong desire to attract investors. Among them, the most popular are Cyprus, Estonia and the United Arab Emirates. Let us compare these jurisdictions with the conditions proposed for foreign capital.
What are the features of doing business in Cyprus?
Cyprus is a classic example of an offshore zone. After some legislative and institutional reforms were carried out in the state, foreign companies in Cyprus began to be taxed at a rate of 12.5%, however, in fact, this is the only tax that business owners in Cyprus face. The reforms made it possible to exclude Cyprus from the black list of offshore zones with a negative reputation, and now businessmen have an excellent opportunity to register a company within three days or buy a ready-made company. The cost of creating a company in Cyprus is about 2.5 thousand euros. At the same time, all the benefits and advantages of the offshore zone are preserved and work for the prosperity of your business.
Why is Estonia called tax haven?
Doing business in Estonia is a very profitable business. If only because the country has no tax on retained earnings. In other words, if the profit from conducting business is directed to the further development of the company, a zero rate is applied. This approach is very attractive both for a start-up business, and for a business that is in the active phase of capital formation.
In addition, Estonia has greatly simplified the procedure for registering companies through the active introduction of information technology. For example, online company registration can take a matter of minutes. There was a well-founded opinion that Estonia is a country for IT business. In fact, well-known programs and services were created here. The creative touch of business makes Estonia an excellent platform for start-ups, freelancers and businessmen who use electronic commerce and other achievements of information and technological thought.
A disadvantage is the mono-linguistic environment. That is, without knowing the Estonian language, a businessman may encounter some difficulties. However, they are solved by attracting local consultants at any stage of registering a business in Estonia.
What are the advantages of the UAE for doing business?
The United Arab Emirates can be safely called another wonder of the world, because for half a century in the desert grew up the richest and rapidly developing state. UAE policy is aimed at actively attracting foreign investment. Emirates differ from the traditional practice of offshore companies in that they offer the choice of registering both offshore and onshore companies. It all depends on the ultimate goal of the business. In addition, free economic zones, which are concentrated on the development of high-tech business areas, play an important role in the economy of the Emirates. Opening a business in the UAE is possible both with 100% foreign participation, and with the involvement of a local partner. The range of business interests is practically unlimited due to the openness of the market and many trade links and transport routes. The Emirates Society is as open as possible and consists mainly of visitors, which greatly simplifies the process of integrating foreign business into the local environment.
Only in Dubai there are more than 20 free economic zones, each of which has its own specifics. Depending on the emirate, the requirements for the authorized capital of companies, as well as the terms of registration, may vary. However, in general, the procedure for creating a company is very simple and takes on average 7-20 days. Here you can read what stages the process of registering a business in the UAE consists of.
What to choose in the end?
Choose the right jurisdiction taking into account the specifics of your business can help professional consulting agencies that will talk about the features of doing business in each of the states.