An offshore company is a legal entity with the right to operate exclusively outside the country. This means that offshore owners cannot sell their products or have an office, i.e. to be physically present, within the UAE except for the purchase of real estate or holding shares in other companies. However, they can still have a local bank account. It must be noted that this form of business doesn't grant eligibility for a residency visa.
Opening an offshore business in the UAE would be an advantage for those individuals who already have their own business in another country and wish to be legally present in the UAE to minimize their tax burden. It is a worthy option to consider if there are no plans for further business within the country. This is owing to the fact that it will be possible neither to scale under this form of business, nor to obtain a mortgage from local banks and financial institutions.
Offshore registration in the UAE is a fairly easy procedure with no start-up capital requirements, just the opening cost of AED 10,000 (USD 2,700). However, there is an obligatory condition, which is financial reporting. Opening an offshore bank account will be more complicated, since banks have their own list of requirements, but it is not impossible to do so.
Features of an offshore company in the UAE:
- The shortest time to set up (from 2 days)
- No need to rent an office
- No auditor's report is required
- High level of confidentiality
- The process of registering a business does not require a personal presence in the UAE
- Offshore structures in the UAE are protected by effective mechanisms