This article is the last in our series exploring the different company formation options in the UAE, from Free Zone to Mainland to Offshore.
Here, we explain some details about the Offshore business license.
UAE Offshore Company Must-Knows:
Offshore companies offer excellent, tax-free environments for companies with the lowest setup costs compared to Mainland and Onshore Freezones.
Like Freezone companies, Offshore companies allow 100% foreign ownership, and thus does not require a UAE National to serve as the Local Sponsor.
Perhaps the greatest advantage of an Offshore company is that they are exempted from all corporate and income taxes, which enables businesses to enjoy complete returns on their investment.
In addition to being 100% tax free, the UAE has signed the Double Taxation Avoidance Agreement with 40 nations, which means entrepreneurs can avoid paying taxes in the UAE and their source country.
The UAE has been certified by the International Maritime Organization as a “White Listed” jurisdiction, which extends certain protections to foreign investors as well as complete anonymity and privacy.
The labor laws that regulate UAE Offshore companies allow incorporated companies to hire employees from anywhere around the world.
However, all the business activities of an Offshore company must be conducted outside of the UAE, as Offshore companies are not permitted to hold a real office within the Emirates.
But it is precisely because no onshore office is required that startup costs are the lowest, as there are no office leasing and visa-related costs. Additionally, Offshore companies are exempt from the burdensome process of having documents attested by various embassies and Ministries of Foreign Affairs. This, coupled with tax exemptions and the low startup and operational costs make Offshore incorporation the most profitable way to run your business the Middle East.