What is Offshore Company?
An offshore company is an entity that is similar to corporations and limited liability companies(LLCs) and it is a company incorporated for the purpose of operating outside the country of its registration and/or place of residence. People usually start an offshore company due to their interest in business expansion, financial privacy and assets protection. Some of the other reasons as to why offshore companies are formed are due to:
• Tax Savings (depending on your jurisdiction)
• Lawsuit Protection
• Flexible Business Laws
• International Financial Diversification
Offshore companies are now being viewed as the most ideal business structure in today’s reality. These entities will only take a day to set up as they don’t have to pay attention to all the local registrations that other forms of companies have to endure. They are extremely easy to incorporate with a reasonable affordable price and relatively free form any type of administration or bureaucracy. Some of the administrative burdens that offshore companies don’t need to deal when forming their entity are the freedom from having no paperwork, no documentation deadlines, not accounting and auditing. These advantages allow business owners to solely focus on running their company free from everyday hassles.
If entrepreneurs are seeking for a company structure that will provide them with more anonymity and privacy protection (such as keeping their business details confidential) then an offshore company is their best option. Confidentiality with limited liability and tax exemption makes an offshore company one of the best business structures out there. The expenses of an offshore company is not higher than registering a local company, however the benefits offered by an offshore company is greater than registering a local company can offer.
Some of the main advantages of offshore companies are:
• Anonymity, confidentiality and the highest level of privacy protection
• Limited liability without any paid up capital requirement
• No accountant costs
• Business can be conducted internationally
• No sales and income tax
• Exempt from reporting, accounting and auditing
The 3 types of offshore jurisdictions in the UAE are:
• RAK FTZ (Ras Al Khaimah) Offshore
• RAKIA (Ras Al Khaimah Investment Authority) Offshore
• JAFZA DUBAI (Jebel Ali Free Zone Authority)
Some of the important things that entrepreneurs need to keep in mind before offshore company incorporation is that they do not offer a real office space, only a virtual office. International trading can be done with no sales in UAE. Other important factors to remember are than residence visa of UAE is not offered with an offshore and as long as a physical presence of the company’s shareholder is there, business owners can hold property and shares within UAE (by JAFZA Off-shore).