Want to setup a company? This will tell you about tax laws in Kuwait, reading this will help you becoming knowlegeable on the specific tax laws and rates for a LLC which is the most common company type in Kuwait.
Kuwait does not impose income tax on companies wholly owned by nationals of Kuwait or other Gulf Cooperation Council jurisdictions. However, GCC companies with foreign ownership are subject to taxation to the extent of the foreign ownership. Income tax is levied on net profits earned from Kuwait-source. However, the tax law does not clearly state the tax treatment of foreign income and is currently treated on a case-by-case basis. Corporate Income tax rate is 15% in Kuwait. This ranks the country as 47th overall in terms of corporate tax rate worldwide.
Kuwait does not imposes value added tax, that ranks the country as 1st overall in terms of VAT taxation rate internationally. In terms of other taxation, an employer will contribute 11.50% to the equivalent of a social security fund and an employee will contribute 10.50%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 98hours. Contributing to this is the number of yearly labor tax payments, which is 12 in KW.
Thin capitalization standards aren't in effect. Thin capitalisation refers to any sort of requirements on a business and the debt-to-asset ratios. Dividends are generally exempted from taxation. A dividend is a distribution of a portion of a company profit, passed by by the board, to a class of its shareholders. Dividends can be issued as cash payments, shares of stock, or other property. Capital gains on the sale of assets and shares by foreign shareholders are treated as normal business profits and are subject to 15% tax. Capital Gains from the disposal of securities on the Kuwait Stock Exchange are exempted. A capital gains tax is levied on the profits that a corporation or natural person realizes when he or she sells sells a capital asset for a price that is higher than the purchase price.
There are no withholding taxes on payments on interests, dividends or royalties to non-residents.
There is no known tax on wealth in Kuwait. There are not known inheritance, real property and transfer taxes in Kuwait. There are no well known R&D intitiatives that provide breaks on taxation in Kuwait.
The above is not tax or legal advice for your company's situation. Incorporations.io can to point you to an accountantin Kuwait who can get you an answer. Ready to get started? Click the free consultation button above.
It takes approximately 98 hours to file and prepare documents for a Kuwait Mixed (Common, Civil and Sharia law).
The corporate tax is approximately 15% which is 48 in the world.
Owners of a company in Kuwait are not allowed to carry back a loss and may be allowed to carry forward a loss for 3 years.
The vat rate in Kuwait is 0% which ranks 1 in the world.
The underlying legal code in Kuwait is mixed (common, civil and sharia law) law. You will want to get some local advice as to how to best structure a company in Kuwait. E-signatures are allowed.
The letters KW is for Kuwait and the most common company type in Kuwait is a LLC.
When setting up, budget about 3 months to put together the paperwork and file a LLC in KW. The types of currencies you can use to capitalize your company is often any legal tender.
Yes, one is allowed to re-domicile a LLC from KW. You are usually allowed to change the jurisdiction of the company, pending certain procedures.
There must be at least This means it is not possible for you to own a LLC in Kuwait as a sole shareholder. You must have other shareholders, they can be nominees or de facto shareholders. Corporate Shareholders are allowed, meaning you could have a company as a shareholder. Foreign ownership is encouraged, up to 100% of the total equity of the company.
A company is only required to have one director. Additionally, corporate directors are permitted. Directors data is typically not exposed publicly. There is a body of law which requires companies to hold an annual meetings of shareholders.
A registered agent is normally required, which means the company will have to pay a fee on a yearly basis, for a legal services company which can receive a service of process on behalf of the company. A related requirement, a company secretary is not always necessary, at least not by law.
There is a requirement to file accounts to relevant authorities. On that note, there is oftentimes a requirement to have these accounts audited.
Thin capitalization rules are in effect. A company is thinly capitalised when there is a greater proportion of debt than equity. The minimum capitalization for a Kuwait Mixed (Common, Civil and Sharia law) is 10,000.
A corporate director is permitted, meaning this country is a good option if you are setting up a structure where you want to protect director liability.
The directors are not disclosed in the public registry of Kuwait, Kuwait Government Online . Shareholders are not disclosed in the Kuwait Government Online .
Typically companies take 3 months to setup and there are 1 director(s) required and 2 shareholder(s) required at the time of incorporation.
Overall we think Kuwait is a ok option and have given it a score of 50 as an IO score, using the Incorporations.IO proprietary formula.
We can help you form a company in Kuwait. Click the button above for a no-obligation quote. We will provide you with all the necessary documents to open a bank account as well as a registered office in Kuwait, which is required by law.