Law regarding setting up a Free Zone Establishment in Dubai while residing in India
This query is : Resolved
22 August 2021
I run a website and get my payment from Google Adsense in form of a wire transfer from the USA. My company is registered in India and I live in India as well. The company has 5 employees, all residing in India.
I was thinking about opening a Free Zone Establishment in Dubai while residing in India and without taking Dubai residency. I am doing this mainly to save taxes and wanted to know whether it is legally possible to do so.
I will be the sole Director in the Dubai Free Zone establishment and it won't have any employees. Even I won't be drawing any salary from my Dubai Free Zone establishment. I will use it only to receive payment from the USA.
I won't dissolve my Indian Company. It will remain as a completely separate entity. I will transfer some money from my Dubai Free Zone establishment to my Indian company so that I can pay the salaries to my employees in India. So basically, My Indian company will be unprofitable and I won't have to pay taxes here.
Is this type of structure legally feasible?
Edit: If possible please let me know of any Tax Attorney in the Delhi Region who might be an expert in this field
I was thinking about opening a Free Zone Establishment in Dubai while residing in India and without taking Dubai residency. I am doing this mainly to save taxes and wanted to know whether it is legally possible to do so.
I will be the sole Director in the Dubai Free Zone establishment and it won't have any employees. Even I won't be drawing any salary from my Dubai Free Zone establishment. I will use it only to receive payment from the USA.
I won't dissolve my Indian Company. It will remain as a completely separate entity. I will transfer some money from my Dubai Free Zone establishment to my Indian company so that I can pay the salaries to my employees in India. So basically, My Indian company will be unprofitable and I won't have to pay taxes here.
Is this type of structure legally feasible?
Edit: If possible please let me know of any Tax Attorney in the Delhi Region who might be an expert in this field
22 August 2021
You are resident of India , so any foreign income earned by you is taxable in India.
You can't avoid any tax on this proposal in india.
You can't avoid any tax on this proposal in india.
Message likes :
1 times
22 August 2021
@CA R SEETHARAMAN
What if I conduct board meetings twice a year in Dubai? Also, this is not my income. Its an income of a Dubai based company.
My proposal might not be correct, but surely this is possible. Many people do it. I just don't know how. I would be very happy if someone could tell me the correct way to do this so that it is completely legal.
PS: I don't believe in free advice. I am willing to take paid services from a Delhi-based tax attorney.
What if I conduct board meetings twice a year in Dubai? Also, this is not my income. Its an income of a Dubai based company.
My proposal might not be correct, but surely this is possible. Many people do it. I just don't know how. I would be very happy if someone could tell me the correct way to do this so that it is completely legal.
PS: I don't believe in free advice. I am willing to take paid services from a Delhi-based tax attorney.
23 August 2021
The management control from India and you own the Dubai company,so tax payable in india.
Put your son or daughter owner of Dubai company and make them non resident.
Put your son or daughter owner of Dubai company and make them non resident.
23 August 2021
@CA R SEETHARAMAN
There are ways to prove that the place of effective management is outside India. I don't think you are well versed enough on this topic. Let someone else answer.
Edit: Arent there any better CAs here?
There are ways to prove that the place of effective management is outside India. I don't think you are well versed enough on this topic. Let someone else answer.
Edit: Arent there any better CAs here?
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Current Account Opening for Sole Proprietorship with Udyam Certificate - Zero Turnover
- TDS on Purchase of Immovable Property by NRI from NRI
- Capital gain from sale of house property
- INTEREST APPLICABLE ON ITC REVERSAL PORTION
- Regarding TDS Applicability For Director Remuneration
- Copyright software
- Before GSTAT- APL-02 Vs APL-04
- Annual return in Gst
- Transporter Declaration form
- Value of property in capital gain
- Tds UNDER SECTION 195 INTEREST PAID TO NRI DIRECTOR
- Clarification on TDS Applicability
- Opting our of sec 44AD
- GST Treatment of Insurance Commission for Existing GST Holder
- Cash gift by grand mother to her grand daughter
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Tds on GST in connection with sale to public company
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
- No Compliences after incorporation
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
