If you want to expand your business in the UAE or manage personal assets more effectively, setting up an offshore company can be a smart move. The UAE offers a range of benefits for offshore companies, including access to a corporate bank account, tax exemptions, and asset protection. However, setting up an offshore company in the UAE can be overwhelming, especially if you need to become more familiar with local regulations and procedures. In this guide, we’ll explore the critical aspects of offshore companies in the UAE, the processes involved in setting them up, and the documents required.

What is an Offshore Company?

An offshore company is a legal entity registered in a country other than the one where it conducts its business. These companies are established in tax-friendly jurisdictions that offer low taxes, asset protection, and confidentiality benefits. Offshore companies are commonly used for international trade, asset protection, and tax planning.

Types of Offshore Companies in the UAE

Two types of offshore companies can be set up in the UAE:

• Jebel Ali Free Zone Offshore Company: A Jebel Ali Free Zone Offshore Company is registered in the Jebel Ali Free Zone. This type of company is ideal for international business, as it allows businesses to conduct business outside the UAE without needing a local sponsor.
• RAK International Corporate Centre Offshore Company: A RAK International Corporate Centre Offshore Company is registered in the Ras Al Khaimah International Corporate Centre. This type of company is ideal for businesses that want to take advantage of the UAE’s tax-free status while conducting business internationally.

Key Aspects of Offshore Companies in the UAE

When considering setting up an offshore company in the UAE, it’s essential to keep the following aspects in mind:

• Access to a Corporate Bank Account: One of the most significant advantages of setting up an offshore company in the UAE is the ease of opening a corporate bank account. You can open corporate and private bank accounts for offshore companies in the UAE, which can help you secure your company’s business activity and manage personal assets. Creating an offshore bank account is simple, and you can have your account up and running in a matter of weeks.
• Tax Exemptions: Offshore companies in the UAE are exempt from paying corporate tax, income tax, and other taxes. This is a significant advantage for companies looking to optimize their tax structures and save money.
• Asset Protection: Offshore companies in the UAE offer excellent asset protection, making them an ideal choice for managing personal assets. The UAE has a robust legal system that protects the interests of offshore company owners, making it a secure and reliable place to do business.

How to Set Up an Offshore Company in the UAE

To set up an offshore company in the UAE, the following steps must be taken:

• Choose a Jurisdiction: The first step in setting up an offshore company in the UAE is to choose a jurisdiction. Jebel Ali Free Zone and Ras Al Khaimah International Corporate Centre are the two most popular jurisdictions.
• Choose a Registered Agent: A registered agent must be appointed once a jurisdiction has been chosen. The registered agent is responsible for handling the company’s legal affairs.
• Choose a Name: The next step is to choose a name for the offshore company. The name should not be identical or similar to any existing company in the jurisdiction where the company will be registered.
• Prepare and File the Articles of Association: The Articles of Association is a legal document that outlines the rules and regulations of the company. The paper must be prepared and filed with the relevant authorities in the chosen jurisdiction.
• Obtain a Business License: Once the Articles of Association have been filed, the offshore company must obtain a business license from the relevant authorities in the chosen jurisdiction.
• Open a Bank Account: The final step in setting up an offshore company in the UAE is to open a bank account. The company’s bank account should be in the same jurisdiction where the company is registered.

Requirements for Setting Up an Offshore Company in the UAE

To set up an offshore company in the UAE, the following requirements must be met:

• Shareholders: Offshore companies in the UAE must have at least one shareholder. Shareholders can be individuals or corporate entities.
• Directors: Offshore companies in the UAE must have at least one director. Directors can be individuals or corporate entities.
• Registered Agent: Offshore companies in the UAE must appoint a registered agent responsible for handling the company’s legal affairs.
• Registered Office: Offshore companies in the UAE must have a registered office address in the jurisdiction where the company is registered.
• Capital: Offshore companies in the UAE do not have a minimum capital requirement.

Documents Required for Starting an Offshore Company in the UAE

To set up an offshore company in the UAE, you’ll need to submit several documents, including:

• Copy of a Valid Passport for All Shareholders: To register your offshore company in the UAE, you must provide a copy of a valid passport for all shareholders. The passport must be valid for at least six months.
• Last Six Months of Bank Statements: You must also submit the last six months of bank statements for all shareholders. This ensures that your company has sufficient funds to operate in the UAE.
• Attested Financial Documents: You’ll need to provide attested financial documents, including audited financial statements and a bank reference letter. These documents should demonstrate the financial stability of your company.

Key Difference Between an Offshore and Free Zone Company

When considering setting up a business in the UAE, one common question is the difference between an offshore and a free zone company. The key difference is that a free zone company is registered and operates within a specific geographical area designated as a free zone, while an offshore company is registered outside the UAE and operates internationally.

FAQs

What are the benefits of setting up an offshore company in the UAE?

The benefits of setting up an offshore company in the UAE include tax exemptions, asset protection, and access to a corporate bank account.

What documents are required to set up an offshore company in the UAE?

The documents required to set up an offshore company in the UAE include a copy of a valid passport for all shareholders, the last six months of bank statements, and attested financial documents.

What is the difference between an offshore and a free zone company?

The key difference between an offshore and a free zone company is that a free zone company operates within a specific geographical area designated as a free zone, while an offshore company is registered outside the UAE and operates internationally.

Conclusion

Setting up an offshore company in the UAE can be an excellent strategy for businesses looking to expand their operations internationally or manage personal assets more effectively. With easy access to a corporate bank account, tax exemptions, and asset protection, the UAE offers an attractive environment for offshore companies.