Frequently Asked Questions (FAQ)
What is the primary benefit of using an SPV?
The primary benefit is risk isolation, allowing the parent company or shareholder to protect themselves from financial exposure related to specific projects or investments.
Can an SPV engage in multiple business activities?
Yes, an SPV can engage in various activities, but these must align with its specific purpose as outlined during its establishment. If the activity is not a qualifying purpose, the entity must be a holding company.
Are there tax advantages to setting up an SPV in UAE?
Yes, UAE offers a favorable tax environment, particularly within the DIFC, making it an attractive location for SPVs. There is the ability for dividend income and other qualifying income to be taxed at 0%, and a wide range of double taxation agreements.
What are the regulatory requirements for maintaining an SPV in UAE?
SPVs must comply with jurisdictional regulations, including the appointment of a registered agent and maintaining a registered office within the jurisdiction.
Can an SPV be used for international investments?
Yes, SPVs can facilitate international investments, providing a flexible and efficient structure for cross-border transactions.
How can I set up a UAE SPV?
Get in touch with the CornerStone team and we’ll assist you throughout the process. As one of only a small number of corporate services providers, we can also be your appointed corporate services provider and provide your registered office.
Disclaimer: The content of this article is intended to provide a general guide to the subject matter and must not be used as legal or tax advice.