Qatar is one of the best countries in the Middle East to conduct business. However, setting up a Qatar Subsidiary is a challenge because you have to comply with the subsidiary law and many other regulations.
If you want to meet your operations schedule you need to know how to set up a subsidiary without any worries. Otherwise, if you fail to meet the rules, you may be subject to delays or even expensive fines.
Nevertheless, it is difficult to establish your Qatar company subsidiary while you are still running your operations in your parent company. There are many aspects involved in running a business in Qatar, such as hiring employees, setting up the payroll, establishing a benefits plan, and more.
In this regard, working with a service provider like Connect Resources can be a great solution. You can either decide not to establish a subsidiary and use our local entity as your EOR or receive assistance in setting up your company in Qatar quickly.
Types of subsidiaries in Qatar
If you plan doing business in Qatar, first of all, you need to know the different types of subsidiaries you can establish:
Limited Liability Company (LLC):
This is the most common type of company in Qatar. You can incorporate it with at least two partners and no more than 50.
Sole Proprietorship:
A single person or a corporate entity can wholly own this type of company.
General Partnership Company:
Two or more parties can form this company, and they assume joint responsibility for funds.
Shareholding Company:
Its capital is divided into tradable shares equally. Shareholders are only responsible for their share value, and not for the liabilities and debts of the company.
Holding Company:
This company has the structure as an LLC, shareholding or sole proprietorship but it controls another or more companies.
Steps to setting up your Qatar subsidiary
According to Qatar companies law, foreign investors can only establish a company if a Qatari national owns at least 51% of the shares. Therefore, as a foreign business owner, you can only hold the remaining 49% of the shares. In this regard, working with experts on companies law Qatar can be helpful.
Furthermore, the regulations may vary depending on the type of subsidiary you are incorporating.
Since most investors prefer to establish an LLC, here are the steps for setting up a company in Qatar:
Step 1:
Decide on a company name and reserve it.
Step 2:
Open a local bank account and make a deposit of the minimum capital of the company.
Step 3:
Prepare your Articles of Association and authenticate them.
Step 4:
Register at the Commercial Registry and Chamber of Commerce and Industry.
Step 5:
Get to the Municipality of Doha and obtain the trade and signage licenses.
Step 6:
Obtain your Tax Identification Number (TIN) for tax purposes.
Step 7:
Get your company seal.
Qatar’s subsidiary law
When it comes to business setup in Qatar, many investors opt for establishing an LLC. This is because each shareholder has a limited liability regarding the capital they invest.
In this regard, each company has to follow the law about this type of Qatar Subsidiary:
- An LLC can be incorporated with two and a maximum of 50 members.
- The minimum capital used to be 200,000 QAR but the recent changes to the Commercial Companies Law establish that there is no minimum capital needed.
- A foreign shareholder can hold 49% of the company’s shares while a local citizen has to own 51% of the shares.
Benefits of setting up a Qatar subsidiary
If you follow the business law in Qatar properly and establish your company without worries, you can now start receiving all the benefits of operating in the country.
Here are all the benefits of doing business in Qatar with a subsidiary:
- You can operate legally in Qatar.
- By setting up a subsidiary like an LLC you can protect your parent company from liability or litigation.
- You can operate independently of your parent company.
- It gives you access to a modern market where you can make business with entrepreneurs and investors.
- Qatar has a favorable business environment where companies can thrive.
- You can access various investment incentives and state-of-the-art infrastructure.
If you do not want to set up a subsidiary, you can always choose a subsidiary outsourcing like Connect Resources. This will help you save time and effort and you can start operating almost immediately.
Furthermore, you will not have to worry about hiring employees, running your payroll, and more, since these tasks will be assumed by us.
Tax Incentives Benefits
A great benefit of business setup companies in Qatar is that you get tax incentives, such as follows:
- Foreign tax credit: income tax that you pay outside Qatar is deductible if the income is taxable in Qatar.
- You can submit your application for tax exemption if your project is considered strategically crucial to the country’s economy.
- QSTP: The Qatar Science and Technology Park is for entities that work on research and development. They are fully tax-exempt.
- Businesses established in any of the Free Zones in Qatar also enjoy tax exemptions.
Compliance after subsidiary incorporation
Once you have established your Qatar Subsidiary, you need to follow the post-incorporation compliance. This means that are some processes you have to go through so you can start your operations in the country:
- You must open a multi-currency bank account in any of the local banks of the country.
- It is essential to get your tax card with your TIN. It is issued by the Tax Department at the Ministry of Finance.
- You must apply for a company establishment card issued by the Ministry of Interior.
- Get the work visas for your foreign employees at the Ministry of Labor and Social Affairs and the Department of Naturalization and Residence.
Important considerations about setting up a Qatar subsidiary
Before you set up your company, it is essential to learn more about Qatar and its rules. This will help you setting up company in Qatar successfully.
As a foreign investor that is considering setup in Qatar, you need to be aware of everything you may encounter. This will help you decrease the likelihood of facing a cultural shock, and thus make your market entry smooth.
Here are some of the things you should know before setting up a Qatar subsidiary:
- Qatar’s official language is Arabic and the local dialect is Qatari Arabic. However, many individuals speak English and others speak French. If you do not speak any of these languages, it is useful to hire a consultant or translator.
- Setting up a subsidiary takes a considerable amount of money and time.
- It may require you to travel to Qatar to carry out processes for establishing your company.
- It is important to have a solid HR team to manage your workforce in total compliance with Qatar’s labour law.
Why Choose Us
Connect Resources can be your go-to partner when it comes to establishing a Qatar subsidiary. We can help you navigate the new Qatar companies law so you can stay in total compliance.
Our goal is to guide you through the steps of incorporating your company so you can start operations right away.
We have a team of specialists well-versed in the new companies law Qatar, so you have nothing to worry about. Also, we offer support in additional matters, such as Saudi business law and more. Contact us to receive a comprehensive solution.
