4 Myths about offshore company formation in UAE

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.

7 Comments
  • Amit Sharma
    Posted at 22:28h, 30 September

    what is the cost associated with trade licence if i want to sell on social media or my own website,

    • shuraabusinesssetup
      Posted at 04:10h, 17 January

      Cost associated with trade license- Social Media:
      1. If the goods are general trading . Then AED40,000
      2. If its specific trading then AED24,000
      for more costing related information please visit our costing blog>>https://www.shuraa.com/blog/2017/01/costs-involved-for-starting-a-business-in-dubai.html

  • Srt Mani
    Posted at 07:27h, 19 November

    Greetings,
    Dear Sir / Madam,
    This is Masilamani, I am an PMP trained Civil Engineer having 10 years and 6 months of experience in Construction industry in various department
    (eg. Estimation, Contract management, Project Management) in UAE. Plus I have experience of managed my own construction company in India.
    I am currently looking for a sponsor to start construction company in UAE.
    I can recruit skilled workers from India.
    I can prepare and quote accurate tender on my own.
    I can execute and manage the project on my own.
    I can take care of all the technical aspects of the project. I need sponsor to invest and help to grow our company as one of the reliable company in UAE market.
    Please contact me at 0508248453/ manicivil.pmp@gmail.com for further discussions.
    Thank you for your time and considerations.

    Best Regards,
    Masilamani
    0508248453

    • shuraabusinesssetup
      Posted at 06:42h, 28 December

      Thank you for enquiring about Shuraa Business Setup. Srt Mani, with reference to your query, we understand that you require detailed consultation. Thus, we have forwarded your concern and a business consultant from Shuraa Business Setup will get back to you at the earliest.

  • aaria arts
    Posted at 04:20h, 26 January

    Hi , if i would like to buy products from another country and sell it online in Dubai
    Example I will buy Handicrafts from Srilanka and want to sell t in Dubai.
    which licence is required?