If you’re considering starting your own company, you might be interested in the possibility of a Free Zone Company Forming within Oman. Free zones are zones of government-owned businesses that provide tax-free company creation. In the end, a number of foreign firms have chosen to establish their operations in this region in the globe. Oman is one of the top business locations due to its tax-free environment for business, along with free zones, which are a common method to establish their business.
WHAT IS A FREE ZONE COMPANY?
A Free Zone Company is a company that is established within the borders of a foreign country. It comes with a unique advantage over an offshore company that includes lower taxes and more flexible requirements for visas. For instance, companies operating that are located in the UAE are able to enjoy the benefit of 100% foreign ownership, no tax on export and import as well as no personal income tax as well as other advantages. If you want to start a business in the UAE it is necessary to choose the name and legal type of your company, you will then have to select the structure of your business.
The process of creating a free zone business is less costly and faster than starting a company in the mainland and comes with less paperwork and quicker incorporation. Documents, like lease agreements and company agreements generally are written and made in English and are bilingual.
In the majority of free zones, businesses is registered in just 10 days. Someone could take less than a week. Contrary to mainland companies, they generally require at least 51 percent ownership in the local area, which is not always easy. When the law permits full foreign ownership and more than 1,000 businesses are eligible for this.
The free zones of the UAE are not just attractive to foreign businesses as well as foreign investors from abroad. In fact, the United Arab Emirates (UAE) has more than 30 free zones which include a large number found in Dubai. They are foreign-owned and fully repatriated, but they are not able to do business directly through their UAE market. However, a zone-free business can still do local business by using designated distributors and paying a Customs Duty of five percent.
TYPES OF BUSINESS ENTITIES IN OMAN
There are numerous reasons to establish your business in an area that is free. The reasons include area and the tax system. Companies operating in Oman can have 100 100% foreign ownership. This permits foreign firms to do business within Oman and still retain control over their business operations.
Oman’s Freezone Sohar, located 220 kilometers to the northwest of Muscat is located near Sohar’s port. Sohar. The port is situated in the Arabian Gulf, this free zone provides easy access to the Indian subcontinent as well as the East African coast. Another example of a zone that is free is Salalah which offers offices for rent as well as business incubators that have recently built headquarters. The city has the world’s deepest seaport and an international airport.
Oman has a substantial oil reserve. But, a significant portion of its economic activity is by trade, agriculture, and tourism. Oman has been continuously diversifying its economy since mid 20th century. Apart from the oil industry, Oman has also developed industries as well as real estate and infrastructure. Capital requirements for the company are low, which means that an international company that has an investment required of OR 150,000 could be a great choice.
TYPES OF FREE ZONE LICENSES ISSUED IN OMAN
Oman offers a variety of free zones, with different permits and licenses. The first one is Sohar Port and Free Zone which is considered to be the main gateway towards the Gulf. It’s an ideal place to get access to the Indian subcontinent as well as the Gulf in addition. Sohar has three major clusters that include a new bulk terminal for agricultural products. Another zone that is free is Al Mazunah, which aims to draw foreign investors by providing support to manufacturing and technology industries.
Zones of free trade in Oman allow companies to establish their operations within three economic zones. The three zones that are free are identified by a specific law that regulates specific privileges and activities. The advantages provided by free zones include being fully owned by foreigners of the company and fewer Omanization requirements with no minimum capital investments, as well as duty-free imports and exports. Additionally, these zones are exempt from taxation and other government regulations as well as there is no limit on the repatriation of capital.
Alongside tax advantages and tax-free zones, the free zones in Oman can be a fantastic location for businesses to set up their operations. They can also draw international companies who might otherwise not be able to enter Oman. Because of its free zones, Oman has grown into a sought-after tourist destination for business. There are a variety of businesses that can be carried out including food processing and manufacturing. The laws for free zones in Oman are based on the concept of equal opportunity for everyone.
BENEFITS OF FREE ZONE COMPANY FORMATION IN OMAN
The country’s Free Trade Agreements and regionally important commerce routes have made it a desirable destination for companies seeking Free Zone Company Formation. The US-Oman Free Trade Agreement (FTA) offers significant duty exemptions for foreign firms. This is particularly advantageous for businesses that are looking to reduce costs. The FTA could be particularly beneficial to the electronics, consumer goods, and textiles industries. Additionally, Oman’s internal security makes the country a favorable option for investors.
Oman is home to three free zones as well as a special Economic Zone, all of which offer a variety of benefits to businesses that establish. The free zone of Duqm offers the ability to access an airport international as well as a deep sea port. It provides flexible customs procedures, as well as exemptions from duties on raw materials as well as finished products. Additionally, it offers an affordable labor and utility system. Along with providing advantages to foreign businesses Oman’s free zone is an ideal location for startups and investors too.
Muscat Freezone Muscat Freezone is located close to its location near the Straits of Hormuz and the Muscat Airport. The strategic location of the Freezone allows businesses to benefit from low freight costs, lower insurance rates, and other benefits. Businesses can profit from the One-Stop-Shop program that allows easy setup and expansion. One-stop-shop programs provide business owners with extensive service. A thorough business plan as well as complete support options make a zone-based establishment in Oman an attractive choice.
TAX EXEMPTIONS IN OMAN
Free Zone establishment of a company in Oman offers a variety of advantages. For one, Oman’s 0 percent corporate tax rate is applicable to companies registered in a free zone and this means that the requirement for capital for the establishment of a new company is less than in other countries.
In addition, the free zones have many advantages for foreign investors, such as no tax on exports and imports, duty-free treatment of imported products and tax-free repatriation of earnings, and the ease of the registration of businesses.
Thirdly, foreign-owned firms have the same benefits and advantages as Omani entities, including the absence of Omanization conditions.
In addition, Oman’s tax laws are fairly clear, and foreign investors can count on lower tax rates. Additionally, Oman’s FDI policies encourage foreign businesses to establish their headquarters in Oman. The FDI policy is aided by the low cost to do business in Oman. Additionally, the government offers low lease rates to specific sorts of companies. Additionally, Oman also has a cost-reflective utility rate.
The Oman judicial system is generally solid, even though the process can take a long time. The appeals process is available in Oman’s three-tier system of courts, which includes Oman’s Supreme Court acting as the final appeals court.
New FCIL has eliminated the share capital minimum requirements which were RO 150,000 (approximately $390,000) as well as eliminated the seventy percent foreign ownership cap. In 2018 it is reported that the GoO has not yet issued any ministerial decision, however, the MOCI has released an unofficial listing of the 37 most commercial activities.
DOCUMENTS REQUIRED FOR FREEZONE COMPANY FORMATION
In the beginning, you must locate a commercial property that can house your business. You must enter into a Tenancy Contract with the owner of the property and obtain the Ejari certificate. Once you’ve got this document then you are able to proceed with the Free Zone business establishment. You’ll need an official CV, as well as evidence of residency. The types of documents you’ll need will vary based on the type of facility you’re setting up.
In the next step, you’ll have to acquire a Salalah Free Zone license that allows you to work inside your Free Zone. The license is granted by the local municipality or the economic department in the region where you’re working. Be sure that you notarize all these documents, and then have them certified by authorities such as the Ministry of Foreign Affairs and the Sultanate of Oman Embassy. These are only a handful of the documents required to complete your FreeZone business establishment in Oman.
When you have all your documents, it is time to begin the process of incorporation. It is important to ensure that you have submitted each document to avoid delays or errors. So, your company will not be at risk of any fees and that’s always a benefit. Sparkle Dubai’s complete process for FreeZone business formation in Oman can help you set up your business more easily than ever. It has strong connections with the authorities of Oman and can help in the smooth process of incorporation.
FREE ZONE COMPANY REGISTRATION PROCESS IN OMAN
Free Zone Registration for a company in Oman can be a simple procedure. If you’ve decided to incorporate your company then you’ll have to register your company at the regional Free Zone Authority. The procedure involves filling out the PAF (Plot Application Form) and submitting it to the Free Zone Authority, and complying with all the rules. Additionally, you’ll need an original copy of your shareholder’s passport in order to complete the procedure.
The Free Zone Authorities will perform a Due Diligence procedure regarding your promoters and shareholders and will also provide information on your customers. Background checks are conducted on your clients too. After the registration process has been completed then authorities from the Sohar Free Zone Authorities will conclude a contract with the brand-new FZ company.
After you’ve successfully registered with Free Zone authorities, then you’ll be required to send the required papers to the Municipality of Muscat. The documents you require are required for a limited liability business as well as shareholder documents and the constitutive contract. These documents have to be attested, notarised, or consumerized, based on the type of business. In Oman, you may also decide to set up an economic zone.