When entrepreneurs decide to enter the international market, choosing the right country for business expansion plays a crucial role in terms of tax benefits, ease of doing business and growth prospects. The most popular regions for business consistently include the USA, Singapore, the UAE and the MENA region in general. Today, we want to focus specifically on the USA and the UAE in light of recent (less favorable for entrepreneurs) developments.
To begin with, the USA often proves to be an excellent option for foreign entrepreneurs, especially when it comes to tax benefits and the convenience of international operations. It’s worth noting that anyone from countries not on the sanctions list can open a business in the USA. If your country is under sanctions but you are a resident of a non-sanctioned country, it is still possible to open a business.
Why are entrepreneurs increasingly choosing the USA?
An LLC with a foreign owner has a major advantage — the absence of U.S. taxation, provided there is no office or employees in the country. This allows for tax optimization and profit generation through an American company. This approach is very advantageous for those actively conducting business in another country.
Opening an LLC in the USA is significantly cheaper than registering and maintaining a company in other countries. The cost, including a fast EIN and opening a bank account, is around $1500, with no annual license renewal fees. Moreover, U.S. legislation allows for the remote opening of bank accounts, making the process highly convenient and fast.
Doing business in the USA means being part of a stable economic and legal environment that ensures predictable business conditions, rights protection and support from government institutions — crucial for long-term planning and risk minimization.
What about the UAE?
Without a doubt, life and business in the UAE have long been very attractive. However, this was until the absence of taxes. With the introduction of VAT in 2018 and a 9% corporate tax on company profits in 2023, the overall tax burden has increased. Additionally, the well-known, relatively high annual costs for license renewals make business operations expensive.
It’s important to remember that many entrepreneurs in the UAE face challenges when opening bank accounts, especially those with passports from CIS countries and remote account opening is not possible.
Where should you run a business?
- If you are just planning to start a company, we recommend focusing on opening a legal entity in the USA right away. This can be done completely remotely within a couple of weeks. Schedule a free consultation with us to learn more about this option.
- If you already have an established business registered in the UAE, you can optimize your tax burden and make the USA the main hub of your company.
Here’s how:
1. Opening a company in the USA to work with international clients, while using your UAE business for obtaining visas/residency and keeping it "dormant." This allows you to combine the benefits of both jurisdictions and minimize tax obligations.
2. Creating a parent company in the USA that accumulates profits from the Dubai business. All profits are transferred to the American company, allowing you to withdraw dividends safely without personal taxation.
To understand which business plan suits you best, contact us. In a free diagnostic session, we will review the options based on your industry and individual needs.
