UAE Company Formation – Which is the best option for you?
January 28, 2020
The year 2020 is the year of ambition and business expansion, in particular, in UAE where it is considered an excellent business credentials especially with facilitating the regulations and processes to setup a company in the region.
However, with different types of company formations, knowing which option is the best for your business and which one is the most profitable might get a little tricky, which is where a consultancy firm can point you in the right direction.
Not to mention the fact that the need to be physically in the city to finalize your documentation can be a roadblock to set up your company in a timely manner unless you have an agency that can help you take care of the process efficiently.
MBG is a consultancy firm and a certified agent. Our experts will sit with you, discuss your options and make sure you make the right choice that will serve your best interest in your business goals.
There are three main corporate structures:
- Onshore Corporate Structures
- Free Zone Corporate Structures
- Offshore Corporate structure
There are different forms of business enterprise for the mainland area:
- Limited Liability CO. (LLC)
- Public Joint Stock Company
- Private Joint Stock Company
- Foreign Companies (Branch Office)
- Sole Establishment
- Civil Company
The mentioned forms include many key regulations that can be discussed in further detail. As for the business licenses, they vary from Emirates-wise, which broadly categorized under: Commercial License, Industry License, and Professional License.
There are over 45 free zones operating in UAE, in which, there is a special tax, customs and import regime. These zones work under their own regulations, and they have many advantages such as:
- Geographically distributed areas
- Every Free Trade Zone has its own laws & Regulations
- Availability of Office, warehouses & Factory Premises according to the requirement
- Efficient Models of Communications and utilities
- Inexpensive Workforce & Easy Recruitment Process
- Exemption from all imports and export duties
- Easy Access to Port, Airport & Road Transport Infrastructure
- “One-Stop-Shop” for facilities including Licensing, Work Permits & Residence Visa
- 100% Foreign Ownership
- Easy Access to Port, Airport & Road Transp100% Repatriation of Capital & Profit ORT Infrastructure
- 100% Corporate & Personal Tax Exemption
- No Currency Restriction
- VAT on certain transaction
As for the business licenses there’s three different ones: For Industrial Activities, For Trading Activities, and For Service Activities.
An ‘Offshore Company’ is a legal business entity that is set up with the intention of operating outside its registered jurisdiction and/or the location of its ultimate ownership. The three principal jurisdictions offering offshore companies in the U.A.E. are Ras Al Khaimah (RAK), Ajman Free Zone and the Jebel Ali Free Zone (JAFZA). All are “tax-free” jurisdictions that levy no income tax or corporate tax and permit 100% foreign ownership. The U.A.E. has double tax treaty agreements with over 40 other countries.
There are three free zone authorities in Dubai that offer an Offshore Company license formation:
- JAFZA Offshore Company Formation
- RAK Offshore Company Formation
- AJMAN Offshore Company Formation
And there are benefits of establishing an offshore company in UAE:
- Keep wealth and income confidential.
- Investors have assets owned by offshore company.
- Do business internationally.
- Option to choose nominee shareholder.
- Investors are allowed access to banking system.
- Investors are allowed to professional services.
Last Updated: 28th January 2020