There are numerous options for Business Setup in Dubai. These are the mainland, free zones, and offshore. All of these have their own set of benefits, some of which are common and some of which are unique to their region. We hope that this blog will assist you in providing important information about offshore company formation in Dubai, UAE.
What exactly is an offshore company?
An offshore company is a business entity that operates from a location other than the country in which it was officially registered or the location of its owners and stakeholders. The goal of forming an offshore company is to reduce taxes and maximise profits.
The UAE government has designated the jurisdictions of Jebel Ali, Ras Al Khaimah, and Ajman to business owners for Offshore Company Formation in Dubai /UAE. In terms of liquidity, taxation, and ownership laws, the government in both jurisdictions has been very supportive of offshore establishments.
The following are the primary benefits of establishing an offshore company in Dubai, UAE:
- Setup is simple and quick: Typically, 100% full foreign ownership is permitted 3-4 working days after document submission.
- Shares that can be transferred through a written contract or deed
- The liability of shareholders is limited to their capital share in the company.
- Names of company beneficiaries are kept confidential.
- Providing there is no suspicion of malicious or criminal activity
- Corporate taxation is mostly avoided.
- Tobacco and alcohol businesses, for example, must pay municipal taxes and duties.
- There are also no minimum share capital requirements.
- The ability to operate without a physical office location with employees can be represented by a law firm and an accountant (subject to registrar approval)
- Typically, lower operating costs
- Asset protection, international trading, tax planning, share acquisitions in other companies, real estate purchases in the UAE (designated areas), trust funds, and so on.
These advantages have attracted investors and multinational corporations from all over the world.
Offshore Company Tax Implications:
Opening a bank account in the UAE for offshore company formation is completely tax-free. This means that no tax is levied.
There are no applications for UAE income tax, capital gains on property, or sales tax in the UAE. It is very cheap and has no tax implications.
The three jurisdictions in which an offshore company can be formed in the UAE are:
- Offshore JAFZA (Jebel Ali Free Zone)
- Ajman Offshore
- RAK ICC (Ras Al Khaimah)
All three are completely tax-free jurisdictions that allow 100% foreign ownership and have no income or corporate tax implications.
1-Jebel Ali Free Zone Authority (JAFZA Offshore):
The Jebel Ali Free Zone Authority (JAFZA), in collaboration with the Dubai Government, introduced the Jebel Ali Free Zone Offshore Companies Regulations 2003 in 2003. JAFZA is a very popular jurisdiction for offshore company registration in Dubai/ UAE.
2-RAK International Criminal Court (Ras Al Khaimah):
RAK International Corporate Centre (RAK ICC) is a corporate registry based in Ras Al Khaimah, United Arab Emirates. RAK International Corporate Centre is in charge of international business company registration and incorporation, as well as a suite of registry services related to their business activity. RAK International Corporate Centre is a modern, world-class company registry that operates in accordance with international standards and best practices in the field of international business company formation.
3-Offshore Ajman (AFZ):
Ajman Offshore Zone (AFZ), which was established in 1988, has a large number of entrepreneurs who prefer to develop their infrastructure in Ajman.
