A Complete Guide for Offshore Business Setup in the UAE
All Business Setup Related Services: Contact Tycoon Documents, Dubai
Mainland companies are licensed by the Department of Economic Development (DED) of the respective emirate. They can operate both within and outside the UAE.
- Local Market Access: Mainland companies can do business anywhere in the UAE, including the local market.
- Office Location: Flexibility to open an office anywhere in the UAE.
- Business Activities: No restrictions on the types of business activities.
- Government Contracts: Eligibility to bid for government projects and contracts.
- Local Sponsorship : Not Mandatory for all Business
Freezone companies are established in designated areas that offer specific economic benefits.
- Full Ownership: 100% foreign ownership is allowed.
- Tax Benefits: Often enjoy tax exemptions, such as no personal or corporate income taxes.
- Repatriation: 100% repatriation of capital and profits.
- Simplified Procedures: Easier and faster company setup procedures.
- Customs Duty Benefits: Exemption from import and export duties within the freezone.
- Specific Activities: Some freezones are specialized and restrict the type of business activities.
Offshore companies are set up for international business operations outside the UAE.
- Full Ownership: 100% foreign ownership is allowed.
- Privacy: High level of confidentiality and privacy.
- Tax Benefits: No taxes on income earned outside the UAE.
- Cost-Effective: Lower setup and operating costs.
- No Physical Presence: Cannot have a physical office in the UAE or conduct business within the UAE.
- Restrictions: Limited to international business activities, primarily for holding, asset protection, and international trading.
How to Setup Offshore in Dubai and the UAE
Setting up a UAE offshore company has become a popular choice for investors seeking to expand their foreign trade opportunities. A Dubai offshore company offers an ideal combination of tax efficiency and cost-effectiveness. Often referred to as non-resident “paper” companies, offshore entities in the UAE allow entrepreneurs in the MENA (Middle East & North Africa) region to operate with minimal administrative responsibilities. These businesses are structured as Limited Liability Companies, offering full ownership with tax exemptions and no annual accounting or tax obligations.
Offshore companies are commonly used for:
- International trading
- Holding company functions
- Shipping operations
- Real estate ownership
- Registering copyrights and patents
- Providing international consulting services
Regulations for International Company Registration
While the UAE offshore company registration process is relatively straightforward, there are important considerations to keep in mind:
- No minimum share capital is required.
- At least one shareholder and one director are necessary.
- Shares must be fully paid at the time of allocation; bearer shares and differential share classes are not permitted. Capital does not need to be deposited in a bank.
- 100% foreign ownership is allowed, with full exemption from taxes and duties.
- You can open a corporate bank account in Dubai.
- A registered agent, such as a legal firm or consultant from an approved list, must be appointed.
- UAE offshore companies fall under the jurisdiction of UAE free zones.
- Incorporation can be done remotely, but documents must be signed at the registered agent’s office.
- Authorities may request audited financial statements if needed.
Offshore vs. Free Zone Company Setup
UAE offshore companies differ from UAE free zone companies. Offshore companies are set up primarily to operate outside their registered jurisdiction or ultimate ownership location. In contrast, free zone companies are onshore entities allowed to conduct business within the UAE and offer UAE residency for shareholders and employees.
Benefits of Registering an Offshore Company in Dubai
Foreign entities have several reasons for choosing a UAE offshore company, including:
- Access to international market expansion
- Stability and a favorable legal system
- Flexible regulatory environment
- Tax neutrality on international earnings, depending on the jurisdiction
- Increased access to global funding
- Asset protection and separation, including intellectual property
The UAE offers three main jurisdictions for offshore company formation:
- Jebel Ali Free Zone Authority (JAFZA)
- Ras Al Khaimah (RAK)
- Ajman Free Zone
Of these, RAK and JAFZA are particularly popular. Both provide tax-free environments and permit 100% foreign ownership. Additionally, the UAE has Double Tax Treaty agreements with over 90 countries. Offshore companies can also open multi-currency accounts for international transactions, though they may not conduct business with UAE residents or maintain physical premises in the UAE.
While both RAK and JAFZA have their advantages, Ras Al Khaimah is generally more cost-effective, whereas JAFZA allows for property ownership in Dubai. Both jurisdictions require an approved registered agent.
JAFZA Offshore Company Incorporation: Features & Benefits
Established in 2003 under the Jebel Ali Free Zone Offshore Companies Regulations, JAFZA offers:
- A minimum of 1 shareholder is required, and corporate shareholders are allowed. International corporate shareholders must provide attested company documents.
- At least two directors are needed, and corporate directors are not permitted. Director details are not publicly disclosed.
- A company secretary is mandatory; a director can also serve as the secretary.
- No minimum share capital is required.
- Accounting records must be maintained for up to 10 years, with annual audits required from approved auditors.
Benefits of JAFZA Offshore Incorporation:
- 100% foreign ownership
- Ability to own real estate in Dubai (subject to free zone and developer permissions)
- Can own shares in free zone and onshore LLC companies
- Multi-currency bank account availability for international transactions
- Shareholders and directors can remain confidential
RAK Offshore Company Incorporation: Features & Benefits
Introduced in 2006 under the Ras Al Khaimah Free Trade Zone Authority International Companies Regulations, RAK offers:
- A minimum of 1 shareholder is required, with corporate shareholders permitted. International corporate shareholders need attested company documents.
- At least one director is required, and corporate directors are not allowed. Director details are not publicly accessible.
- A company secretary is necessary; a director can also act as the secretary.
- No minimum share capital is required.
- Accounting records must be kept for up to 7 years, though they do not need to be filed with RAK authorities.
Benefits of RAK Offshore Incorporation:
- 100% foreign ownership
- Ability to own shares in free zone and onshore LLC companies
- Fast incorporation process, typically within a week
- Multi-currency bank account availability for international transactions
- Confidentiality for shareholders and directors
Start Your UAE Offshore Company Today!
Establishing your international business in the heart of the world’s business capital is now possible. With the support of experienced business consultants like Tycoon Documents, you can get answers to all your questions about setting up an offshore company in Dubai. Explore a world of opportunities by setting up your business in the UAE.
TycoonDocuments experts are ready to guide you through the offshore company incorporation process, ensuring a smooth and hassle-free transition. Contact us at +971 56 993 1404, WhatsApp 971 56 993 1404, or email info@tycoondocuments.com.
Frequently Asked Questions
Here are answers to the most frequently asked questions.
Yes, a foreign national is eligible for 100% ownership of a free zone/Offshore and In Mainland specific business company in Dubai, and across the UAE.
Yes, foreign nationals can easily register a business in Dubai. Professional assistance is necessary for aspects like licensing, visa issuance, and bank account opening, and a business setup consultant in Dubai can assist you with this.
Yes, Dubai/UAE allow you to register and own businesses without the need for a physical office space.
Yes, you can easily sponsor your spouse and children through a free zone business license.You are Eligible for Family Visa
The three(3) most prominent licenses available in UAE are professional, commercial, and industrial.
Professional license:
A professional license permits offering specialized services such as consultancy, accounting, legal advisory, and so on. This license is required for skilled professionals looking to set up businesses and deliver services based on their intellectual or artistic capability.
Commercial license:
A commercial license is granted for businesses involved in trading activities and is required to legally conduct activities such as import and export of goods within and outside the UAE.
Industrial license:
An industrial license is needed for businesses conducting activities such as manufacturing, packaging, segregation, etc.
The following documents are required from the shareholder(s) and manager(s) for free zone company formation :
- Passport copy
- Latest UAE entry stamp/visit visa copy
- Residence visa copy and Emirates ID (for UAE residents)
- Address proof
- Passport-size photo
Please note that in addition to these, you may be required to submit additional documents. Consulting with a Tycoon business setup company will help you gain more information in this regard.