Which type of Dubai company should I choose to get bank + VISA? DMCC or other?

[Casper]

I’ve tried to tell the tax department, in Portugal, that I’m leaving. But then they want a new address. I’m currently a resident, but not a citizen. I’m going to travel for quite some time so I don’t have a new address to give them. I tried to just give them an address for a place I might stay for some time, but they didn’t accept that.

Is there a clever way to do it, or should I just ignore it? If I’m not staying in the country and don’t have any ties to the country, I assume that’ll do?

Would it be a problem if I used an address from something like the digital residency in Palau?

 

[Sols]

Casper said:
I’ve tried to tell the tax department, in Portugal, that I’m leaving. But then they want a new address. I’m currently a resident, but not a citizen. I’m going to travel for quite some time so I don’t have a new address to give them. I tried to just give them an address for a place I might stay for some time, but they didn’t accept that.

Is there a clever way to do it, or should I just ignore it? If I’m not staying in the country and don’t have any ties to the country, I assume that’ll do?
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Establish a new place of genuine tax residence, give them that address, and then go travel the world. If you don't do it properly, Portugal may not accept that you are non-resident and treat you as a resident until proven otherwise.

If you're an EU citizen, one of the easiest options you have is the 60-day tax residence program in Cyprus. Move there, rent a place to live for at least a year, spend 60 days in Cyprus, and then start travelling the world. As long as you don't become tax resident anywhere else, you qualify as tax resident in Cyprus by just spending 60 days per year there. You can get a tax residence certificate to show the Portuguese tax authority, in addition to your proof of registration/residence permit.

Casper said:
Would it be a problem if I used an address from something like the digital residency in Palau?
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It's generally not smart to lie to tax authorities. If you make an honest mistake, most tax authorities are reasonable. But if you deceive them and they find out, they won't be quite as kumbaya.

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This is the probably the answer to your question.

 

[TheCryptoAnt]

maybe you could tell them you are going back home?

 

[scooterguy]

With the little information you are providing, a wild guess is that they will still consider you a tax resident during 2023, unless you can give them an actual tax residency in a country with a DTA with Portugal.

This can happen if you had or still have any sort of economic activity in there, or if you still have a place of abode.

 

[Mike Forman]

Can confirm what they indicate above and as in many topics already covered. You better always have somewhere a residency (where they preferably leave you alone and no tax on worldwide income).

Too many people believe they can travel around the world and be long enough (>186 days) outside their country of citizenship escape taxation on personal income. Before it would suffice to just give any adress without further proof (which could still be challenged by tax authorities).

Now some countries require proof of residence just as the consulate/embassy in the country of residence requires you if you plan to register yourself in that country, such as visa >6 months and address proof.

Then you can handle all your consular services in that country (apply new passport,etc..) and send any communication, summons, etc.. to your new address

 

[Mssquirrel]

TheCryptoAnt said:
maybe you could tell them you are going back home?
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I think this should be fine and unregister yourself from everything in the country

 

[aragon]

If you have no ties to Portugal, nothing. No rented apartment, no garage, no storage, no car, no family, nothing whatsoever in that country, I think you can tell them this: fin4774"

What are they going to do? For a tax authority to claim tax residence of a person they must have something of substance tying that person to the country. You're not even born there.

But yes, deregister yourself, close accounts, memberships, etc.

 

[Mssquirrel]

aragon said:
If you have no ties to Portugal, nothing. No rented apartment, no garage, no storage, no car, no family, nothing whatsoever in that country, I think you can tell them this: fin4774"

What are they going to do? For a tax authority to claim tax residence of a person they must have something of substance tying that person to the country. You're not even born there.

But yes, deregister yourself, close accounts, memberships, etc.
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Agreed deregister yourself from the address you have registered in the country even if is an apartment you are renting I did that in another country not Portugal but maybe same aplies there check it out.

 

[Konstanz]

aragon said:
If you have no ties to Portugal, nothing. No rented apartment, no garage, no storage, no car, no family, nothing whatsoever in that country, I think you can tell them this: fin4774"

What are they going to do? For a tax authority to claim tax residence of a person they must have something of substance tying that person to the country. You're not even born there.

But yes, deregister yourself, close accounts, memberships, etc.
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Some countries has rules. If you leave to tax havens like UAE, you still liable tax for couple of years.
Don't know about Portugal.
I think Cyprus is good option , because it's EU country

 

[Alonzo]

Konstanz said:
Some countries has rules. If you leave to tax havens like UAE, you still liable tax for couple of years.
Don't know about Portugal.
I think Cyprus is good option , because it's EU country
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Indeed but, is there a list of countries that do so on the internet? I unfortunately couldn't find one.

 

[Mssquirrel]

GHD999 said:
Indeed but, is there a list of countries that do so on the internet? I unfortunately couldn't find one.
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It depends on your country and which countries they consider tax havens

 

[koohl]

Casper said:
I’ve tried to tell the tax department, in Portugal, that I’m leaving. But then they want a new address. I’m currently a resident, but not a citizen. I’m going to travel for quite some time so I don’t have a new address to give them. I tried to just give them an address for a place I might stay for some time, but they didn’t accept that.

Is there a clever way to do it, or should I just ignore it? If I’m not staying in the country and don’t have any ties to the country, I assume that’ll do?

Would it be a problem if I used an address from something like the digital residency in Palau?
Click to expand...

You leave the country and setup a postal address before you tell the auth. that you have left! That worked well for me. When I asked them while I still was in the country they told me you are not allowed to do so!

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[Nitteerersfum]

Hi,



I’m currently based in Poland and planning to set up a company in Dubai. I’m also looking to obtain a visa, Emirates ID, and open a local bank account.



In the past, I had a very frustrating experience with banking in Hong Kong (even before 2020), and I want to avoid running into similar issues. This time, I’m looking for a reliable solution,not necessarily the cheapest,just something that actually works, especially when it comes to opening a bank account successfully.



My business is in e-commerce. I don’t require a physical office or residence, though I understand this might affect banking eligibility. I’d appreciate your advice on the best company type (mainland vs. free zone, etc.) that gives me the highest likelihood of setting up a functional and compliant business with proper banking access.



I also have a question regarding VAT. I know the UAE applies a 5% VAT on transactions between local companies. Would it be legally acceptable to move stock through an EU-based company,for example, by having the UAE entity sell to the EU company, which then sells to the end customer back in the UAE? My goal is to remain fully compliant and steer clear of any regulatory hurdles.



Looking forward to your recommendations.

 

[Xshore]

digitalrazor said:






I also have a question regarding VAT. I know the UAE applies a 5% VAT on transactions between local companies. Would it be legally acceptable to move stock through an EU-based company,for example, by having the UAE entity sell to the EU company, which then sells to the end customer back in the UAE? My goal is to remain fully compliant and steer clear of any regulatory hurdles.

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I think VAT is only applicable if the goods are in the UAE? Are your customers in the UAE?

 

[daniels27]

digitalrazor said:






In the past, I had a very frustrating experience with banking in Hong Kong (even before 2020), and I want to avoid running into similar issues. This time, I’m looking for a reliable solution,not necessarily the cheapest,just something that actually works, especially when it comes to opening a bank account successfully.

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Sorry to hear. What happened? You had issues with banks in Hong Kong or Poland? Because to be honest, the reputation of UAE is very, very low in the EU.











digitalrazor said:






Would it be legally acceptable to move stock through an EU-based company,for example, by having the UAE entity sell to the EU company, which then sells to the end customer back in the UAE? My goal is to remain fully compliant and steer clear of any regulatory hurdles.

Click to expand...

What are you selling? Physical or digital goods? In any case, this most likely won't help.



Physical Goods

VAT is normally due where goods are. If you sell from UAE to EU but the goods remain in the UAE, you most likely won't qualify for a VAT exempt supply as the goods remain within the VAT area. If a EU owns goods in the UAE, the company will be subject to UAE VAT rules most likely and will have to register for VAT.



Digital Goods

Most coutries by now have VAT rules that tax digital goods with a very low / no threshold. If an EU company is selling digital goods to UAE B2C, they will owe VAT as any UAE business.

https://www.anrok.com/vat-software-digital-services/united-arab-emirates

 

[Nitteerersfum]

I encountered issues with Hong Kong banks , all my applications were rejected. As a result, I was left with a Hong Kong company without a bank account, rendering the setup effectively useless.



Regarding transactions between Dubai and the EU, I’m referring strictly to B2B digital goods. Our intention is to sell to a buyer based in Dubai, but due to the 5% VAT, they are reluctant to proceed with a direct purchase.



We’re considering using an EU-based company as an intermediary. The idea would be to sell from our UAE company to the EU entity under a 0% VAT B2B transaction, and then sell from the EU company to the Dubai buyer, again as a B2B deal with 0% VAT.



However, we’re concerned this structure could be interpreted as tax avoidance under UAE regulations. Would this raise legal or compliance issues with the authorities in the UAE?

 

[daniels27]

You still have the Hong Kong company? Banking is difficult but generally possible if you show some connection to the market. EMIs may be easier to start with. At least when you have a local visa, there should not be any issues.



B2B where all companies are registered VAT payers? Why would they be reluctant if they get back the VAT right away?



I don't think there will be any big issues in regards to tax avoidance as essentially you are not avoiding anything.

 

[Nitteerersfum]

No I don’t have HK company. It’s closed since years.



Not exactly.



Here’s the structure of the transaction:


SELLER (UK company)

→ 2. MY UAE company (Dubai)

→ 3. MY EU intermediary company

→ 4. BUYER (UAE company, also in Dubai)
The key point is this: if we skip the EU intermediary (company #3), a 5% VAT would typically apply between company #2 and company #4 (both based in the UAE). By routing the goods through the EU entity, we effectively structure the transaction to avoid the 5% VAT, achieving a 0% VAT setup.



This could potentially raise red flags with UAE authorities, as it might be seen as VAT avoidance,since the stock temporarily leaves the UAE and then re-enters solely to circumvent the local VAT obligation.



Back to the topic. Which free zone company should I chose in Dubai to setup reliable bank account? DMCC? IFZA? Or other? What’s the biggest issue when opening bank account in Dubai these years?

 

[Xshore]

digitalrazor said:






→ 4. BUYER (UAE company, also in Dubai)

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Have you asked if they mind paying the vat? If they are vat registered they will get the vat back so vat shouldn't matter for B2B.

 

[daniels27]

Xshore said:






Have you asked if they mind paying the vat? If they are vat registered they will get the vat back so vat shouldn't matter for B2B.

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Exactly. There normally is zero discussion about VAT in business negotiations. It is just a given that it needs to be paid and recovered.