Setting up a business in Dubai

[Miyagi]

Hi everyone

I wanted to ask for some advice....

A friend and I have found a product that is in high demand that we can import cheaper than you can buy in the UK. However with the VAT we have to pay on entry into the country and then the taxes we are paying and fluctuating exchange rate are making it difficult for us.

This venture is not either of our main businesses and most likely a temporary arrangement for around 12 - 18 mnths.....with our main businesses remaining in the UK and seperate to this.

The item we are importing is expensive and cash flow is vital so we could do with any help with can get. Especially as our initial investment spent on stock usually does not return to us with any profit until at least 3 weeks later.

My partner has some experience in setting up a company in Dubai and thinks we could benefit by forming a company there as it is free of VAT and any tax....

I realise you need to set up Free Zones to avoid having part national ownership etc etc but I was wondering if anyone had some extensive knowledge of the process and could either give me some advice or point me in the correct direction

Thanks in advance

[christmc]

Hi there, How are you getting on with your Dubai business? I feel my company is missing a trick not being involved in that particular new fast moving economy ?

[Eric Mc]

Do you actually plan to run the company from Dubai and will it be genuinely doing business in Dubair i.e. will its seat of management be in Dubai or the UK?

[DonnyMac]

Talk to the VAT man.

There has been a complete and utter clamp down on expensive (small in actual size – mobiles, computer chips, razor blades etc) items coming from the UAE.

The telecoms trading industry was shut down in its entirety, £bn’s of reclaimable VAT revenue withheld by HMRC – businesses that had traded for decades put down almost overnight.

Went to the Lords, they said it was unbelievable, but too late as the businesses had gone.

Google (+search the PR section of HMRC) for carousel fraud and MTIC – ‘missing trader’ fraud.

I’ve dug up and old story from Mobile Business Magazine which I’ve parked on a content holding domain –

http://www.mcnmagazine.co.uk/index.php?option=com_...

This also has a link to the 35 page Lords ruling.

The VAT man may well shut you down before you start so best to talk to them before making any investment in high value items from Dubai.

Best of luck,
Donny

[christmc]

Im looking at Dubai with a view to my company doing some contracting and installation business over there? any ideas guys?

[DonnyMac]

I have a couple of UAE clients that I supply email marketing services to without a problem, or requirement to charge them VAT (no services enjoyed by the client within the UK or EU), contracting or services should be fine, mention 'import/export' & Dubai within a 100 miles of HMRC and you're asking for serious attention.

I'm sure I have a VAT flow chart somewhere, PM me your email address and I'll forward it over to you.

Best,
Don