Myths about offshore company formation in the UAE
UAE offshore companies have continued to offer a productive and a prolific environment for investors from around the world. Yet, people associate offshore companies with fallacies such a money laundering and secrecy of assets.
Assumptions state that offshore company formations are mainly done to disguise an illicit money. However, the UAE government takes strict measure to eradicate any such activities that are noted by the respective offshore authorities.
The UAE government has appointed a ‘Financial Action Task Force’ to deal with the issue. ‘Financial Action Task Force’ is a governmental body directed by the Federal National Council. They combat against money laundering & terror financing. With huge penalties and long jail terms in the UAE, the committee seeks to create a clean and an uncorrupt economic milieu.
Here are some of the myths of offshore company formation in the UAE:
Myth – Evasion of Tax
Fact – The myth is that you can evade taxes by starting an offshore company, which is false! There is no doubt that starting an offshore company could be tax efficient. Offshore company formation in the UAE offers tax avoidance. Meaning it reduces your overall tax liabilities as promoted by the law. Although, there is a difference between tax evasion and tax avoidance! Evasion of tax literally explains an illegal activity, wherein you do not pay what should be paid in contemplation with the law.
Myth –Illegitimate & Added Risk Factors
Fact – There are suppositions that offshore companies are illegal. Businessmen around the globe think that starting a business or opening a commercial bank account involves risks. The truth is that every jurisdiction offering offshore company formation in the UAE has a governing authority. The offshore authority the sole body that guides and controls companies within the jurisdiction. The authority also ensures legality, privacy and security benefits at all times!
Myth – Costly Business Setup
Fact – Starting an offshore company is one of the quickest ways you can setup a UAE company. This makes people think that offshore company formation may be a costly affair. The fact is that offshore companies are not only cost-efficient, but also offers an affordable module to start a business in the UAE.
Myth – No Governance or Law
Fact – Offshore companies do provide confidentiality, the privacy of ownership and secrecy of transactions. But it is not true that offshore companies in the UAE have no governance or are absent from law. UAE offshore jurisdictions have their own authority system with independent directive laws to ensure upfront dealings.
Like to know more about offshore companies in the UAE? Contact Shuraa Business Setup.