An Offshore Company is often used to make Investments and accumulate wealth. The major difference is that the offshore company does NOT have to pay tax on its profits, nor does it have to pay inheritance tax when it is passed on to heirs. In many jurisdictions, withholding Tax is levied on income remitted out of the jurisdiction, but the careful use of double-tax treaties can reduce or even eliminate tax on the investment income. This may enable the Investor to make investments in high-tax countries from an offshore base with minimal tax liability. Most importantly, the use of an Offshore Company also protects the identity of the ultimate beneficial owner. Anonymity comes automatically with Offshore Companies, and is respected by the law in the offshore world.
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What is an Offshore Company?
In financial language, the term “offshore” is used to define any business or investment made
outside the country of residence or in other words an offshore company is a legal entity
Offshore Company, most commonly termed as International Business Company or a Non-
Resident Company, is a legal structure which provides for a low/No-tax environment for an
entity or an individual which in turn minimizes tax burdens and improves wealth management.
Offshore company formation in Dubai must be incorporated under Offshore Company
Laws and regulations of offshore jurisdictions.
Offshore company Must not trade within the offshore jurisdictions
There are innumerable advantages in setting up a Dubai offshore company as the business
climate is very favorable to entrepreneurs and also conducive to growth. Still Offshore Company
Formation in Dubai needs a lot of factors to be considered before you jump into the fray. Setting
up business in the UAE (comprising of seven emirates: Dubai, Abu Dhabi, Sharjah, Ras Al
Khaimah (RAK), Umm Al Quiwain, Fujairah & Ajman) and anywhere in the world, significantly
depends on the rules & regulations, the business environment and the culture prevailing in the
respective region. It is important that all related issues are identified, understood and dealt with
effectively during the course of setting up the business. There are various ways of doing business
in a new country; one of the ways is to set up a legal entity in the country you wish to operate in.
This requires research on the new business environment and subsequent planning to set up the
business, based on the research. Like a chess game, the success depends on decisive and correct
opening moves. We plays a vital role in assisting with offshore company formation in Dubai.
Why setup an offshore company?
There are number of reason why so many private individuals and businesses incorporate an
offshore company however followings are the main reason to setup an offshore company.
Anonymity, confidentiality and the highest level of privacy protection
No accountant costs
Business can be conducted internationally (Invoice international clients)
Corporate Bank Account
Prestigious Registered that you can use our address for your offshore company
Offshore company can act as an intermediary in any transactions of your Company with
Listed below is information summarizing the reasons for why offshore companies are
Privacy & Confidentiality and Asset Protection
Tax optimization (depending on your jurisdiction)
Flexible Business Laws & Lawsuit Protection
International Financial Diversification
Benefits of Dubai Offshore company formation
100% tax free
100% tax/customs duty free
100% ownership, no local national involvement required
100% repatriation of profits and investments
Suitable for any kind of international business
No office space requirements
Liberal bank account opening and maintaining
Multi-currency bank accounts
Quick incorporation – 2-3 working day
Uses of an Offshore Company
As most other companies an offshore company may enter into contracts, open bank accounts,
purchase and sell various products and services, own property. A typical offshore entity, also
known as an International business company (or an offshore IBC) does not pay taxes in its home
Following can be the uses of an offshore entity:
You can also carry on your consultancy or counseling business by using an offshore company.
You will find it easier to manage your company and will have reduced or even zero taxation
depending on the jurisdiction in question.
A trading company can be establishing itself in an offshore area. The offshore company would
take orders directly from the customer, but have the goods delivered directly to that customer
from the manufacturer or place of purchase. The profits arising out of the difference between
purchase price and sales price would then be accumulated in Offshore Company’s bank account.
oProperty Owning Companies
There are a number of good reasons why the use of offshore companies has become so popular
when buying property in Dubai. The most obvious reason would be the avoidance of
A company does not die. If your property is held in a low-cost offshore company, you (and your
partner or partners) can own the shares of it as you see fit. So rather than have your individual
names on the title of the property, you have a company name. In case of any
uncertainty/unforeseen, all of your property and bank account will be frozen until a sharia court
As a UAE property investor, we do recommend to buy the property OR investing in any
Company under the name of an off-shore company. so if in case your family will not be
suffering. When the owner sells the property; a certain percentage of its value may charge by the
authority. The transfer fee can be easily avoided by selling the Company itself.
People who want to invest their money in different projects and they don’t want to disclose to
someone, can incorporate an offshore entity and then this offshore can invest as a corporate
investor in different project. An offshore company can hold the shares of other companies in
UAE or abroad.
oCopyrights, Trademarks and Patents
Any kind of intellectual property right (a copyright or trade mark) may be registered in the name
of an offshore company. The company may also buy or sell this type of rights.
Offshore companies can be used as a holding company where people can manage their all
business under one holding structure.
Choosing the right Offshore jurisdiction
The structure of an offshore jurisdiction is important for many reasons. First, it is good for you
when you are able to connect with the country easily, certainly through modern and reliable
telecommunication lines. The country must have a up-to-date and reliable banking and financial
The factor which is very important but commonly overlooked – work ethics and traditions. Some
regions are more relaxed in their attitude to work; this may become a critical issue when you
need something to be done quickly and accurately. Some countries have historically developed a
work culture of diligence, prudence and secrecy, others are less so.
Time zone should also be taken into account: dealing with the jurisdiction on the other side of
the globe may frequently make you lose a day while communicating via e-mail or fax, and is
certainly more convenient to make calls during your usual business hours.
There is a very significant difference between the ‘safe haven’ of The Emirates and other
worldwide ‘tax shelters’ The Emirates and other GCC countries of The Middle East are ‘Zero
tax’ jurisdictions by nature and not by design.
Why incorporate an offshore company in UAE
Since the inception of UAE offshore company formation in early 2003, the UAE has quickly
emerged as the business hub of choice in the Middle East region and is proving itself to be well
placed to being one of the most dynamic and fastest growing business and International Financial
Given the UAE’s continued stance on ZERO tax’s and duty exemptions, there is little wonder
why more and more individuals and International Companies are now choosing the Emirates as,
not only their business headquarters, but also in many cases their primary choice of residence
In 2003, Jebel Ali Free Zone Authority (JAFZA) Dubai’s foreign ownership Free Trade Zone,
became the first location in the UAE to provide offshore company formations. In February 2007,
Ras Al Khaimah Investment Authority (RAKIA) and Ras Al Khaimah Free Trade Zone
(RAKFTZ) located in the most Northerly region of the Emirates expanded their already thriving
Free Zone to include offshore business formations, often known as International Business
Companies (IBC’s.) Due to the excellent operational service methods adapted by RAK
Offshores, the offshore incorporation division of RAKIA and RAKFTZ, coupled with the clear
documentation process and lower incorporation fees, RAK Offshores have stepped into the
driving seat of offshore formations within the UAE.
RAK Offshore Company Formation
A new type of Offshore Company in RAK with the abbreviations RAK ICC (Ras Al Khamiah
International Corporate Centre) is planned for the first half of 2016. It’s an International
Business Company (IBC) proposed for the international business.
Basically, RAK International Corporate Centre (RAK ICC) is afresh merged entity of the earlier
two types of companies –RAK Offshore and RAK IC. RAK Offshore companies were registered
by RAKIA and RAK IC companies were registered by RAK Free Trade Zone Authority.
These two companies were relatively similar but had some differences on the applicable
Merger between RAK IC and RAK Offshore was announced in May 2016 and new changes are
being applied to newly formed registry. The regulations and laws of RAK ICC are being made
more exhaustive and wide-ranging to streamline various procedures
The introduction of the RAK offshore Company does not involve any major changes in the
current key advantages of an offshore company in UAE. RAK Offshore companies, same as
before, remain totally Zero from taxes. Same as previously, there is no requirement to submit an
audit report, whereby the UAE offshore jurisdictions are broadly known and recognized as
highly respected for registration of offshore companies for international businesses.
There will be no substantial changes for the existing companies incorporated under RAK
Offshore, so those companies can still operate same as earlier. The only amendment will be
made to the Memorandum of Articles of the existing companies stating the change of status to
RAK Offshore company.
The UAE has been signed for double tax treaties with more than 47 – A RAK Offshore
company can best take benefit of those treaties.
However, all UAE Offshore companies or other companies must to follow United Arab Emirates
law, RAK International Corporate Center (RAK ICC Offshore) can choose which law should to
be applicable for arguments, inheritance and any other legal matter (the chosen law must be cited
in the Memorandum and Articles of Association). A RAK offshore company can hold shares in
“onshore” Dubai company (such as Dubai LLC company), or any other legal entity globally. A
RAK International Corporate Center (RAK Offshore Company) can also own real estate property
(such as free hold properties) in the UAE.
A RAK offshore company can hold a bank account in the Dubai UAE, for the use of carrying the
day to day operational transactions and other related persons carrying out business. A
RAK offshore company does not allow to carry out business with UAE residents, or conduct any
trade in RAK Free Trade Zone and the UAE, unless, until it has obtained the suitable license
from the concern authorities.
JAFZA Offshore Company Formation
The Jebel Ali Free Zone was established in 1985 by the Government of Dubai, and now consists
over 100 square kilometres built around the largest artificial port in the world. JAFZ contains
offices, warehouses and storage facilities in side for all kinds of goods, and a container port with
70 berths. Companies incorporated at the JAFZ have customarily been required to have a
physical presence in jebel Ali .
Though, following the overview of the Regulations for Jebel Ali Free Zone Offshore Companies,
which came the concept of offshore company formation was first introduced in Dubai in 2001
but it got a proper structure on January 15, 2003 when JAFZA Offshore Company registration
2003 came into existence.
JAFZA Offshore Company incorporation 2003 implemented comprehensive rules and
regulations for offshore company formation in Dubai.
Dubai offshore company is well-defined as a non-resident company which is having a corporate
legal structure in Jebel Ali Free zone Dubai UAE. JAFZA Offshore Company formation 2003
permits the incorporation of an offshore company by individual or by establishments.
Benefits of JAFZA Offshore Company formation in Dubai :
No need to acquire office premises.
JAFZA offshore company registration provides high level of asset protection.
Zero percent tax environment.
Aallows 100% foreign ownership.
Minimum operational cost in JAFZA offshore company.
JAFZA offshore company formation has no limit on flow of capital.
Easy and simple procedure of incorporation.
Opportunity to invest in properties worldwide.
Transfer of shares and assets etc.
There is no minimum capital requirement.
Buying Freehold properties in Dubai which are approved by JAFZA (Properties from
Developers like Dubai Properties Nakheel, Emmar etc.).
Ajman Offshore Setup
Ajman Free Zone was established in 1988 and was allocated an independent status under the
Emiri Decree No. 3 of 1996 by Humaid Bin Rashid Al Nuami the Ruler of Ajman. In Recent
years there is magnificent increase in the number of Ajman company formation in the free zone.
Offshore company formation in Ajman has been started as late as 2014. Ajman Offshore
Company is under the regulations of Ajman Free Zone Authority and since then it converted a
popular choice for offshore company formation in Ajman. Just like any other offshore
jurisdictions, Ajman Offshore company formation offers a Zero Tax Structure and Ajman
offshore Company is providing confidentiality & privacy. The permitted address of the Ajman
The cost of set up an offshore company in Ajman is the inexpensive in UAE and is less time
taking process to setup Ajman offshore company. Ajman offshore companies are also non-
resident companies just like other offshore companies and are not allowed to operate in UAE.
Here, these companies will only get a company incorporation certificate. Ajman offshore
company cannot carry business within United Arab Emirates. These shareholders are, however,
permitted to invest in UAE companies. For Ajman offshore company registration, a director or
shareholder needs to be physically present in Ajman Free Zone office, along with a registered
agent, and personally sign the documents then and there.
Features of Ajman Offshore Companies:
No office space is mandatory
No residence visa
100% tax free and 100% profit repatriation
Complete confidentiality and privacy
Only international business is permitted and no UAE sales or trading transactions
Easy incorporations and license renewals
Approved by all leading bankers in UAE
Types of licenses offered:
Investment kind of licenses
Freelance kind of licenses
Professional licenses etc.
Characteristics of Ajman Offshore Company Formation in the AFZA are as
Shareholders: For Ajman offshore company registration required Minimum of one
shareholder. Corporate shareholders are acceptable in Ajman Offshore Company
formation. Shareholders will have a choice to decide the capital structure of the Ajman
offshore company. Single class of shares allowed but bearer shares are not allowable.
Directors: A minimum of two directors are required to setup Ajman Offshore company
and corporate directors are not acceptable. The same shareholder (s) can also be a
director of the Ajman offshore company.
Secretary: Ajman offshore company must have a secretary. And a director can be a
secretary as well.
Restrictions on Name & Activity: The name of the offshore company in Ajman must
end with Limited.
Local Requirements: Ajman Offshore Company must appoint an official registered
agent. A registered agent’s office in the UAE will be used as the registered office of the
Ajman offshore company .
Timescale: Registration of the Ajman Offshore will take approx. 2 to 3 working days.
Shareholders or their authorized attorneys should visit in person to sign documents in
presence of AFZA executives for Ajman Offshore company formation.
Taxation: Ajman Offshore company pays Zero/no taxes in UAE.
Confidentiality: In Ajman Offshore company formation the details of shareholders &
directors will be filed with Ajman authorities but will not be public.