Every businessman wants to work in the most supportive and profitable environment. When it comes to starting a business, Dubai without a doubt passes the mark of ‘that’ environment. In this blog, we are going to discuss on starting an offshore company in Dubai.
An offshore company is a legal business entity that is set up with an intention of operating outside its registered jurisdiction and/or location of its ultimate ownership. Establishing an offshore company in the UAE is an ideal, tax efficient, and cost effective corporate structure for entrepreneurs who wish to conduct international trade. An offshore company in Dubai is also called as a non-resident paper company that allows foreign entrepreneurs to serve Africa and the Middle East without administrative obligations.
The two principle jurisdictions offering formation of offshore companies in the UAE is Ras Al Khaimah (RAK) and the Jebel Ali Free Zone (JAFZA). Both are tax-free jurisdictions that levy no income tax or corporate tax and permit 100% foreign ownership. These types of companies are also permitted to open multi-currency accounts in the UAE and carry out business internationally. They may not, however, carry on business with persons resident in the UAE nor have physical premises within the UAE.
Remember that, UAE offshore companies must not be confused with UAE freezone companies. Free Zone Companies are onshore entities permitted to carry out business in Dubai with certain restrictions. They are similarly subject to the 0% rate of corporate tax but they enable their shareholders, directors and employees to obtain residency in the UAE.
Advantages of Forming Dubai Offshore Company
- An offshore company is legally exempt from corporate tax, making it an ideal international trading
- The shareholders and the directors of the offshore company are not required to register their names and details for public record
- A Dubai offshore company is exempt from all annual accounting and tax obligations
- Setting up an offshore company in the UAE is a cheap and easy way to get a corporate bank account in Dubai
- No customs duty
- Full repatriation of funds and multi-currency transactions
- 100% foreign ownership
Procedure to Start an Offshore Company in Dubai
Even if you put the UAE’s incredible low tax regime, and ease and low cost of doing business aside, there’s yet another great reason to set up an offshore business here – it’s incredibly easy to do so. In fact, the company formation process is so simple that it can often be completed in a matter of weeks. Here are the steps that you need to follow to register your offshore company in Dubai.
- Select a name for your business. Ideally, the name of the company shall reflect the corporate activities. When choosing a name there are a few restrictions you need to follow like the selected name must not be similar with the company name of any established entity, no usage of words like banking, insurance, re-insurance etc.
- Fill an application for registration. The application must be attached with supporting documents. The documents depend on the number of shareholders in the company.
- Once the application is filed, it is reviewed by the relevant authority who will approve/disapprove you application depending upon several factors.
- If the application is accepted, you have to open a bank account for your offshore company in Dubai.
Documents Required to Start and Offshore Company in Dubai
For individual shareholders in the company-
- Attested passport copy of the owner / shareholder
- Residential proof
- Original bank reference document
- Details of the owner / shareholder
- Preferred name of the company to be formed
- Activities of the newly formed offshore company
- The hierarchy of beneficiaries
For Corporate shareholders in the company-
- Board resolution
- Memorandum of Association
- Parent company certificate mentioning the name of shareholders / directors, and duly attested
- Hierarchy of beneficiaries
JAFZA Offshore Company Formation in Dubai
JAFZA is currently one of the fastest growing free zones in Dubai with its own set of regulations and was created with a purpose to attract investments. JAFZA offshore company incorporation is allowed to trade internationally and is allowed to own property in the Emirate of Dubai. Corporate shareholders are permitted. JAFZA offshore company is also allowed to own and operate a bank account in Dubai.
RAK Offshore Company Formation in Dubai
RAKIA offshore company is a part of Ras Al Khaimah Investment Authority, offering comprehensive solution and flexible regulatory framework for international business. It is a offshore business centre created for non-resident entrepreneurs who need an offshore location to conduct business, and outsource back office activities.
Now that you are aware about the procedure of offshore company formation and know where you can form one in Dubai, you can go ahead with the plan. If you are still confused or skeptical about the process, we at Business Setup Worldwide can help you with it. Contact us today- we’d be happy to assist you.