SETTING UP BUSINESS IN QATAR
General Aspects
Qatar is a sovereign Arab state located in the Middle East, occupying the small Qatar Peninsula on the northeastern coast of the Arabian Peninsula. It shares its only land border with Saudi Arabia to the south, while the rest of its territory is surrounded by the Persian Gulf. The capital city is Doha, a rapidly growing metropolitan hub and the country’s economic center. Qatar covers
approximately 11,586 square kilometers and has a population of around 2.9 million people, the majority of whom are expatriates. The official language is Arabic, but English is widely used in business and commerce. The currency is the Qatari Riyal (QAR).
Legal Forms of Business Entities
Legal form Feature
Branch Office A branch office in Qatar has no separate legal identity and operates as an extension of its foreign parent company. It can engage in commercial activities but must be registered with the Ministry of Commerce and Industry (MOCI) as a Foreign Branch. Additionally, for service-related activities, including both regulatory and non-regulatory services, a branch can also be registered under the Qatar Financial Centre (QFC)
Sole Proprietorship Owned by a single individual who bears full liability for debts and obligations. Registration with the MOCI is required, and certain activities may require additional licensing.
Partnerships Requires at least two partners who share liabilities and profits. Can be a general partnership or limited partnership, with different liability structures.
Limited Liability Company (LLC) Foreign companies or individuals can now have 100% ownership in Qatar for all activities, except for a few restricted sectors, including banking, brokerage, real estate activities, insurance, and financial institutions. This applies to businesses registered under both the MOCI and the QFC
Joint Venture A contractual agreement between two or more parties to conduct business together without forming a separate legal entity. Typically, one partner is a Qatari national or company.
General Partnership An association of at least two individuals who share full liability for debts with their private assets. It must be registered with the Ministry of Commerce and Industry (MOCI).
Remarks
Suitable for foreign companies looking to establish a presence in Qatar, especially if they have a government contract.
Suitable for freelancers and small businesses. No minimum capital is required.
No minimum share capital is required. Accounting and regulatory obligations are generally less stringent than corporations.
Offers limited liability protection. No minimum capital requirements.
Suitable for specific projects or collaborations. No separate registration is required, but a contract is recommended.
Suitable for small and medium-sized businesses. Partners are jointly liable for obligations.
Limited Partnership Consists of general partners with unlimited liability and limited partners whose liability is restricted to their investment. The entity must be registered..
There are the following corporations in Qatar law:
Public Shareholding Company (QSC)
Limited Partnership by Shares (LP)
A company with shares that can be traded publicly. Requires at least five shareholders and a minimum capital of QAR 40 million. Must be approved by the Qatar Financial Markets Authority.
At least one partner, the general partner, has to be liable for debts and liabilities of the company without limitation. The general partner can also be a corporation with limited liability.
The KGaA can have an unlimited number of capital investors (limited shareholders), whose liability is limited on the capital contribution they subscribed.
Suitable for investors looking for limited liability while allowing others to manage the business.
Shares can be publicly traded, making it a good option for large businesses. Extensive regulatory requirements apply.
Suitable for investors who want limited liability while allowing a managing partner to operate the business.
Single-Person Company (SPC)
A company owned entirely by a single person, who has limited liability. The owner can be an individual or a company.
Family office and Trust Can be established as a Limited Liability Company (LLC), Limited Liability Partnership (LLP), or Special Purpose Company (SPC).
Ownership: Typically, 100% family-owned, with governance tailored to family needs.A Trust under QFC is a legal arrangement where assets are held by a trustee for the benefit of designated beneficiaries, providing estate planning, asset protection and succession management.
Ideal for entrepreneurs who want full control with liability protection. Requires commercial registration.
Permitted Activities:
Wealth and asset management for a single-family
Investment structuring and portfolio management
Succession planning and estate structuring
Philanthropy and charitable giving Administrative support for family members
Organizational Questions
Topic Feature
Commercial Registration
Trade License Notification
Companies of all legal forms must be registered with the Ministry of Commerce and Industry (MOCI). Certain business activities require additional approvals from regulatory authorities.
Businesses must obtain a trade license from the MOCI to legally conduct activities. Additional sector-specific approvals may be required.
Bank Account To open a business bank account, companies must provide a commercial registration, trade license, and articles of association. Individuals need a valid QID (Qatar ID) and residency proof.
Transfer of Goods and Machinery Imports into Qatar are subject to customs duties, typically at 5% of the value, except for exempted goods. Special approvals are required for certain items.
Transfer of Capital Capital can be moved in and out of Qatar freely for foreign investors, subject to compliance with financial regulations.
Visa and Residence permit Foreign investors and employees need a work visa or investor visa sponsored by a registered Qatari company. The Qatar Financial Centre (QFC) and Qatar Free Zones (QFZ) offer business-friendly visa options.
Employment
Topic Feature
Work permit Foreign nationals require a work permit sponsored by a Qatari employer to work legally in Qatar. Employers are responsible for visa processing and sponsorship.
Remarks
Operating a business without registration is illegal, and penalties may apply.
A physical office space is required for trade license approval.
Large cash deposits may require proof of the source of funds to comply with anti-money laundering regulations.
Free zones offer exemptions on import duties for certain businesses.
Transactions above a certain threshold must be reported for compliance with financial monitoring regulations.
Short-term business visits can be conducted on a business visa, but long-term operations require a residence permit.
Remarks
Some free zones, such as Qatar Free Zones (QFZ) and the Qatar Financial Centre (QFC), offer business-friendly visa policies.
Labour law Qatar has strict labor regulations under the Ministry of Labour. A minimum of 21 days of paid annual leave is mandated, along with public holidays. Standard working hours are 48 hours per week, reduced to 36 hours during Ramadan. The notice period for termination depends on the length of service. The Wage Protection System (WPS) ensures timely salary payments.
Social system Qatar does not impose social security contributions on expatriates. Qatari nationals contribute to a pension system, with employers required to contribute 10% of the salary to the General Retirement and Social Insurance Authority (GRSIA).
Employers must provide health insurance for expatriate employees under the mandatory health insurance system. No personal income tax is levied in Qatar
Taxation
Companies in Qatar are subject to taxation primarily at the corporate level. Corporate income tax (CIT) applies to foreign-owned businesses, which are taxed at a flat rate of 10% on net profits, unless they operate within a Qatari free zone, where tax exemptions may apply. However, businesses fully owned by Qatari or GCC nationals are generally not subject to corporate tax. Qatar does not impose personal income tax, meaning that sole proprietors and employees are not taxed on their earnings. Additionally, there is no value-added tax (VAT) or trade tax imposed on businesses at the municipal level, though customs duties apply to imported goods outside free zones.
Tax Feature
Corporate Income Tax (CIT))
A standard corporate tax rate of 10% is applied to taxable income of foreign-owned businesses. Companies owned 100% by Qatari or GCC nationals are generally exempt.
Remarks
Businesses operating in Qatar Free Zones (QFZ) or Qatar Financial Centre (QFC) may have tax exemptions or preferential rates.
Withholding Tax (WHT)
Payments made to non-residents for services performed in Qatar are subject to 5% withholding tax on royalties and technical fees.
Personal Income Tax Qatar does not impose personal income tax on salaries, wages, or personal earnings.
This tax applies to foreign entities that do not have a permanent establishment in Qatar.
Expatriate employees are not taxed on their income, making Qatar a taxfriendly destination.
Zakat Companies owned by Qatari or GCC nationals are required to pay Zakat at 2.5% of their net income or net worth. This is calculated based on Islamic principles and applies instead of corporate income tax for local companies.
Value Added Tax (VAT) Qatar currently does not impose a VAT system, though it has been considered under GCC agreements.
Real Estate Transfer Tax There is no specific real estate transfer tax in Qatar. However, fees may apply for property registration and transfers.
Real Property Tax There is no annual property tax in Qatar. However, commercial properties and developments may be subject to municipal fees.
Businesses should stay updated on potential future VAT implementation.
Fees vary depending on the transaction and location of the property.
Fees are determined by the Ministry of Municipality and Environment (MME).
Non-Resident Taxation Non-residents earning income in Qatar may be subject to corporate tax at 10% if they operate a business in Qatar. Qatar has signed multiple double taxation treaties (DTTs) to prevent tax duplication.
This guide has been prepared by Newoon, an independent member of Antea
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This publication is intended as general guide only. Accordingly, we recommend that readers seek appropriate professional advice regarding any particular problems that they encounter. This information should not be relied on as a substitute for such an advice. While all reasonable attempts have been made to ensure that the information contained herein is accurate, not Antea Alliance of Independent Firms neither its members accepts no responsibility for any errors or omission it may contain whether caused by negligence or otherwise, or forany losses, however caused, sustained by any person that relies upon it.
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