Entrepreneurs have several options when starting a new business in the UAE. You can set up in the country’s mainland, start a business in a free zone or open an offshore company.
While the first two choices may be more common, the third, offshore company ownership, offers many incredible benefits from confidentiality to tax efficiency. So, if you are looking to start a company to hold property, shares or other assets, keep reading to find out:
- • Seven advantages of setting up an offshore company in Dubai, UAE
- • Steps to obtain an offshore licence in Dubai, UAE
- • Cost of starting an offshore company in Dubai, UAE
- • How Creative Zone can help
Seven advantages of setting up an offshore company in Dubai, UAE
Offshore companies differ from standard UAE businesses in several key ways. Most notably, offshore companies are not permitted to conduct business activities within the UAE. Instead, they are mostly used to hold stakes in other companies or to purchase real estate.
However, while offshore companies have very specific use cases, they also come with a broad array of advantages here in Dubai.
Helping to keep your business dealings private
UAE offshore companies have no obligation to maintain or publish financial records or details of any shareholders. What’s more, most jurisdictions will only supply this data to third parties such as government or legal authorities if they believe there is a risk of terrorist or criminal activity.
For even greater confidentiality, offshore company owners can appoint nominee shareholders to handle official documentation. The nominee then issues power of attorney back to the owner.
2. Greater tax efficiency
A simple way to reduce your tax burden
Offshore companies offer a simple way to legally minimise a tax burden. In the UAE, such businesses can benefit from the country’s 0% tax rate on income and enjoy full exemption from customs tax, VAT, capital gains and withholding tax.
The UAE also has double tax treaties with over 100 countries so shareholders who are nationals elsewhere do not have to pay tax on UAE income in their country of origin.
3. Asset protection
Keep your holdings safe from lawsuits and more
Offshore companies in the UAE can hold assets including real estate, intellectual property, stock and securities in complete anonymity outside mainland jurisdictions.
This type of corporate structure effectively acts as a robust legal wall protecting all holdings and assets from legal obstacles and third-party adversaries. For high-net-worth businesses and individuals, this can be a highly effective way to ward off frivolous lawsuits and the like.
4. Open UAE bank accounts
Access the UAE’s world-renowned banking sector
UAE offshore companies are able to open multiple bank accounts within the country with local and international financial institutions.
This allows the company to send and receive money with other businesses and individuals from around the world. So, wherever held assets are located, the company can benefit from one of the world’s most robust and trusted banking infrastructures.
Depending on the exact needs of your business, bank accounts can usually be opened within eight weeks.
5. Fast and efficient formation
A low cost, simple and speedy way to start a business
As offshore companies have minimal regulatory requirements, no need to take on physical premises and can be started with just one shareholder, the formation process is usually fast, simple and low cost.
In many cases, a UAE offshore company can be formed in as little as three to seven working days.
6. Hassle-free administration
Minimal reporting requirements mean easy maintenance
A lack of auditing and financial obligations means that ongoing maintenance and running costs for offshore businesses are also lower than other company types.
With no need for share capital or corporate document attestation, administration costs are always low. What’s more, as AGMs can be held anywhere in the world, manhours required to run the business are minimal.
7. Stay in control
Own your company 100% with no outside influence
UAE offshore companies can be owned 100% by foreign entrepreneurs with no need to partner with a local agent or stakeholder. This leaves you free to run your business as you would anywhere in the world without outside interference. Though, of course, if you required local assistance, you are free to partner with a local shareholder or company agent as you wish.
Steps to obtain an offshore licence in Dubai, UAE
While starting an offshore company in the UAE can be fast and straightforward, it does require an expert eye. When you work with Creative Zone, we can handle all formalities for you, liaising with all relevant departments to ensure a hassle-free application.
Our team will guide you through the following process:
1. Choose your company name
Your company name must adhere to the UAE naming conventions. As well as avoiding any words that could be deemed offensive or blasphemous, you must also not include the following: insurance, bank, finance, building society, cooperative, fund, municipal, chamber of commerce, trust, royal, chartered, mutual fund, Emirate or Emirates.
All offshore company names must also end with Ltd. or Incorporated.
2. Complete your application
At this stage you will need to submit your completed application form as well as other documents including an attested passport copy for all individual shareholders, proof of residency, preferred name of the company being formed, and details of the business activities that you intend to undertake.
3. Open an offshore bank account
Once you have submitted your application and drafted your Memorandum of Association, you can open a UAE corporate bank account.
This is not always a straightforward process for entrepreneurs from outside the GCC. However, the team at Creative Zone will take the time to get to know your requirements before advising on the bank best suited to your needs.
Cost of starting an offshore company in Dubai, UAE
The cost of forming a UAE offshore company starts from just AED 13,800. However, while setup costs are low, you will need to account for a few additional fees on top of this.
For a full and personalised breakdown of the costs involved in starting an offshore company in the UAE, get in touch with the team at Creative Zone.
How Creative Zone can help
Whether you’re looking to start a free zone, mainland or offshore company, Creative Zone are the experts in all things relating to business setup in Dubai.
Our dedicated team of company registration professionals have helped over 45,000 entrepreneurs to launch and grow their businesses in this part of the world. Our time-tested and ground-breaking model gives you a one-stop shop with everything you need to start your offshore business.
Plus, our flexible payment plans and tailored packages help keep costs low – and we offer a wide range of support services to help you and your business long after launch. So, if you’re looking to get started out here, get in touch to find out more.