United Arab Emirates and Dubai in particular, is considered an excellent location for investors and for setting up a new business.
The benefits of setting up an offshore company in Dubai or any location in the United Arab Emirates are numerous. Available are different locations, providing different advantages to investors. However, a prime reason is the tax exemption offshore company in Dubai enjoys when operating an offshore business in the United Arab Emirates. Moreover, Dubai is a well-known supporting international business center, supporting foreign investors initiatives.
United Arab Emirates offers different and many opportunities to open your own company in any jurisdiction. You’ll be able to choose between free zones, offshore and mainland jurisdiction. Below these options are briefly addressed.
1. United Arab Emirates Free Zones Companies
Company formation of United Arab Emirates free zone company. A careful consideration needs to be made to choose the right free zone, based on the company activity and other factors to avoid any negative consequences.
All free zones in Dubai will offer you the following benefits for your business development:
- 100 % of ownership for all investors, including foreign investors.
- No restriction of repatriation of profits and capital.
- Full exemption on personal and corporate income tax for 15 years. This exemption is renewable for another 15 years.
- Full exemption from all import and export duties.
- Free zones in Dubai provide flexibility to engage in international business.
- All investors can hold properties, participate in multiple activities, and open a bank account in any local bank.
- As an investor, you can get easy access to handy offices, warehouse facilities, and many other similar services. Also, you can receive assistance in housing facilities, staff visas, among other support services.
Below are the popular free zone destinations of RAKEZ (Ras al Khaimah – head office in Dubai) and of IFZA (Dubai).
RAKEZ Free Zone Company:
Setting up a company in RAKEZ free zone. This is located in the northernmost part of the United Arab Emirates, specifically in the heart of Ras Al Khaimah. Due to its strategic location, it facilitates the connection between investors and markets of the Middle East, North Africa, Europe, and South and Central Asia. With more than 50 flourishing industries and 14.500 successful companies in it, RAKEZ offers a cost-effective and world-class economic zone with customizable packages, services, and facilities to help its clients succeed at their goals.
RAKEZ Free Zone Company main benefits:
- Cost effective business packages.
- Shared work-stations in a premier business center.
- Ready or customizable offices of various sizes.
- Simplified and fast-track business set-up processes.
- Secretarial and business center services.
- One-stop shop for all government services.
RAKEZ Free Zone Company time-frame:
The License will be released after average 2-5 working days. Visa process will be after that and that takes 10-15 working days average. In overall the process will take 3-5 weeks.
IFZA Free Zone Company:
Setting up a company in IFZA free zone, which is one of the newest free zones in the country. It has gained an excellent reputation in a short time, which is due to the facilities and the support it provides to its entrepreneurs and investors, allowing them to start their businesses in the free zone without wasting time. This free zone operates with around 400 local and international company formation specialists, having more resources to help its new investors to thrive in the market and accomplish their goals with their many different companies and businesses. Not only will you be granted benefits and advantages, but also services and different packages to boost your business and make it more profitable. IFZA free zone offers a wide range of flexible business setup solutions to help you save time and effort.
IFZA Free Zone Company main benefits:
- Strategically located in Dubai, which provides world-class access to global markets.
- Convenient access to all Free Zone business formation and administration services.
- An expert multinational team who can advise on the perfect fit for you from their 2,000+ business activities.
- Business licenses are available through the incorporation of FZCOs or the formation of branch offices.
- Professional, Commercial and Industrial activities can be combined under one IFZ license.
- Competitive General Trading license available.
- Transparent and competitive pricing.
- Fast and efficient company incorporation processes.
- No physical presence of the business owners required during the incorporation process.
- No paid-up share capital requirement.
- No NOC from current visa sponsor.
IFZA Free Zone Company Formation time-frame:
The Application for security clearance takes about 2-4 days. Once signed they issue license, then Client can then apply for establishment card (2-6 days). Once issued IFZA can proceed with e-Visa. The full process dependent on immigration and client pace takes about 3-5 weeks.
2. Dubai – United Arab Emirates Offshore Company
Setting up an offshore company to conduct their transactions outside the United Arab Emirates borders. Company formation of offshore company to trade, hold assets (like shares in companies, patents, trademarks), and run normal business activities legally outside the jurisdiction.
Dubai/ United Arab Emirates Offshore Company Main Advantages:
- UAE company can be 100 % owned by a foreign ownership.
- Tax and duty exemption (no corporate, income, VAT, inheritance, or property tax).
- Full repatriation of profits is possible.
- There is no currency restriction, which means the company can use any currency as capital.
- Investors have better access to global funding.
- It is not a requirement to deposit the money in the offshore bank account.
- There’s the available option of purchasing real estate in approved areas.
- Minimum capital requirement.
- Investors have access to a stable and business-friendly legal system.
- Offshore business is a gateway for international market expansion.
- Offshore companies enjoy the benefits of the DTAA (Double Taxation Avoidance Agreement) with 115 countries, including the UK.
- UAE company can hold separate assets from operating entities, like Intellectual Property.
Where can you set up an United Arab Emirates Offshore Company?
The three main locations in the emirate of Dubai, where you can form an offshore company are in JAFZA (Jebel Ali Free Zone), in RAK (Ras Al Khaimah) and Ajman.
3. United Arab Emirates Mainland Company
Company formation of United Arab Emirates Mainland or onshore company that gets its license from the Department of Economic Development (DED) of the concerned Emirate. Some of the characteristics of this company are the following:
- It’s allowed to carry out business in the local market and outside the United Arab Emirates
- The company is formed by the government authority of the related Emirate
- There is no restriction regarding the trading activity.
There is difference license for a Mainland United Arab Emirates Company, which should be carefully chosen, based on the business activity.
United Arab Emirates Mainland Company main requirements:
- As a rule, in the UAE the expat opting for a commercial license can acquire only the 49% of the company shares. The rest 51% should be acquired by a UAE national,
- The business should have a physical office space and it should comply with a minimum of 200 sq. ft.
- A main advantage of this jurisdiction is that allows companies to carry out business anywhere in the UAE as well as outside the UAE.
- There is no restriction in terms of visa eligibility. However, the area of workspace determines the number of visas issued.
- Requirement of annual audited Financial Statements
- The legal structure determines the minimum capital requirement of the business.
- Your company requires standard approvals such as the license issued by the DED, and from other government bodies like Ministry of Labour, Dubai Municipality, etc.
The United Arab Emirates has many free trade zones and free industrial zones, in which more than thousand of companies operate, many of which are well-known brands. Each zone offers all or some of the above options. Each investor should seek the advice of a consultant to reach the final choice and to know all the relevant details of the documents required.
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