IBC offshore companies in the UAE: how and why to register?

The UAE has long established itself as an international hub for business, attracting entrepreneurs from all over the world with its favourable conditions. In 2023, the UAE was ranked in the top 10 countries for ease of doing business. One of the most popular options for foreign entrepreneurs is to register an offshore company like IBC (International Business Company). This company format is ideal for those who want to protect their assets, reduce their tax burden and do business internationally.

What is an IBC offshore company?

An IBC offshore company is an international company incorporated in a jurisdiction that offers tax benefits and simplified business rules. The UAE offers several regions where you can register an IBC, among the most popular are:

• Jebel Ali Free Zone (JAFZA)
• RAK International Corporate Centre (RAK ICC).

These zones offer entrepreneurs many benefits including full tax exemption, no need to file financial statements, and a high degree of confidentiality.

Advantages of registering an IBC in the UAE

Registering an offshore IBC company in the UAE offers a number of significant advantages.

• Full tax exemption. There are no income taxes for offshore companies in the UAE. This allows you to significantly reduce the tax burden on your business.
• 100% foreign ownership. Unlike other jurisdictions, in the UAE offshore companies can be wholly owned by foreigners without involving local partners.
• Absence of currency restrictions. You can conduct international transactions without capital controls.
• Privacy. The UAE provides a high level of protection of data on company owners and does not participate in the automatic exchange of tax information.
• Ease of administration. The absence of mandatory audits and financial reporting simplifies company management.

Stages of IBC offshore company registration in the UAE

The process of registering an offshore company in the UAE involves several key steps.

1. Selection of jurisdiction. First of all, you need to choose where your company will be registered. The most popular zones for IBC are JAFZA and RAK ICC, each of which offers its own features and advantages.
2. Choosing a company name. The company name must comply with the rules of the jurisdiction. It should not contain words related to banking, insurance or other regulated sectors.
3. Preparation and filing of documents. The following documents will be required to register a company:
4. Passport details of the founders and directors.
5. Proof of residential address.
6. Constituent documents of the company.
7. Opening a bank account. After company registration, you can open a corporate bank account in one of the UAE banks to conduct international financial activities.

Where is it better to register an IBC: JAFZA or RAK ICC?

Both zones offer excellent conditions for registering offshore companies, but they have their own distinctive features.

JAFZA (Jebel Ali Free Zone) is one of the oldest and most prestigious free economic zones in the UAE. It is ideal for companies that want an international presence and access to major ports and transport routes.

RAK ICC (RAK International Corporate Centre) is one of the fastest growing zones offering affordable offshore incorporation facilities. It is characterised by easy registration and flexible conditions for business.

Costs of registering an offshore company in the UAE

The cost of registering an IBC offshore company in the UAE can vary depending on the zone chosen and the size of the business. The main costs include:

• Government fees for company registration
• Office rental (if required)
• Opening a bank account
• Services of a registration agent
• Costs can range from $2,000 to $6,000 depending on the zone and additional services.

Types of IBC offshore company activities

IBC offshore companies can be used for a variety of purposes:

• Asset management
• International trade
• Investment activities
• Consultancy and professional services
• Intellectual property management
• It is important to remember that offshore companies in the UAE cannot trade domestically or own property within the UAE.

Interesting facts about offshore companies in the UAE

About 40% of all offshore companies in the UAE are registered in the RAK ICC zone, making it one of the most popular jurisdictions.

More than 60 per cent of offshore companies in the UAE are used for international trade and asset management.

In 2023, the total number of registered offshore companies in the UAE will exceed 100,000, indicating the high popularity of this jurisdiction among international entrepreneurs.

Registering an IBC offshore company in the UAE is a great solution for entrepreneurs looking to optimise their tax burden and protect their assets. Due to its full foreign ownership, lack of taxes and strict confidentiality, the UAE is one of the most attractive jurisdictions for setting up offshore companies. It is important to carefully choose a zone for registration and take into account all the peculiarities of doing business in this country. Offshore companies in the UAE provide unique opportunities for international trade, asset management and investment, making this region attractive for businessmen from all over the world.