Dubai offshore company formation

Who registers offshore companies in Dubai?

In Dubai, offshore companies are registered by JAFZA, the Jebel Ali Free Zone Authority. Its Offshore Companies Regulations 2023 define the zone as the Jebel Ali Free Zone in Jebel Ali, Dubai, and were made under Dubai Laws No. 1 and No. 4 of 2001. A JAFZA offshore company is therefore a Dubai registered entity.

The company receives a certificate of incorporation, not a license. It must obtain a license or permit from the competent authority before it carries out business activities in the zone or anywhere else.

This page covers why founders choose Dubai. The rules on directors, the secretary, the registered agent, the audit and JAFZA's fees are set out in detail on the Jebel Ali offshore page.

Can a Dubai offshore company own property in Dubai?

JAFZA's regulations permit it. A JAFZA offshore company is permitted to own a property in one of the designated freehold areas, under Regulation 14.2(e) of the JAFZA Offshore Companies Regulations 2023. The Dubai Land Department decides each registration.

A 2013 resolution by the Chairman of JAFZA authorises JAFZA to register any offshore entity that wishes to own property in the Dubai projects listed below.

JAFZA issues a No Objection Certificate letter to own property for offshore companies. The letter is in Arabic, costs AED 200 and is issued in 1 working day.

• Freehold areas
• Dubai Properties and Wasl Properties
• Meraas Holding

Good to knowThe regulation refers to designated freehold areas without listing them. We confirm with JAFZA and the Dubai Land Department whether the property is in an accepted area before you commit.

What does the Dubai Land Department say about companies owning property?

A Dubai Land Department guide states that companies registered in a Dubai free zone, such as JAFZA and DMCC, and other free zones approved by the department, may own real estate within the designated areas.

The same guide states that the department does not allow foreign companies to own real estate in Dubai directly. A foreign company must set up a company in JAFZA, DMCC or another approved free zone and register the property in that company's name.

The guide is dated 2017 and refers to companies registered in a Dubai free zone without using the word offshore. The Dubai Land Department decides each registration and its policy can change.

Good to knowWe confirm the current position with the Dubai Land Department before you commit to a purchase. Nothing on this page is a promise that a registration will be accepted.

What else is a Dubai offshore company used for?

JAFZA states the uses of an offshore company as international trade, holding companies, owning real estate, registration of copyrights and patents, and international consulting services.

The regulations also list specific things the company is permitted to do in the UAE.

• Own a stake in another operating company within the UAE (Regulation 14.2(f)).
• Hold a bank account in the UAE (Regulation 14.2(g)).
• Use a property it owns in a designated freehold area as its registered office (Regulation 31.1).
• Engage UAE lawyers, accountants and management companies.

Good to knowThe regulations permit a UAE bank account. Each bank runs its own checks and makes its own decision on whether to open one.

Can you get a residence visa if your offshore company owns property?

An offshore company does not normally lead to a residence visa, but JAFZA's regulations contain one exception for companies that own property.

Under Regulation 31.2, an offshore company that owns property in a designated freehold area may apply to the authority for a residency visa for its members, subject to the authority's eligibility requirements.

JAFZA does not publish those eligibility requirements. We confirm them with the authority for your case before you rely on this route.

Does UAE corporate tax apply to a Dubai offshore company?

Yes, the UAE Corporate Tax Law applies. A company incorporated under UAE legislation is a Resident Person under Article 11 of Federal Decree-Law No. 47 of 2022, and it must register with the Federal Tax Authority.

A Resident Person that is a company is subject to corporate tax on taxable income from inside and outside the UAE. Corporate tax is 0% on taxable income up to AED 375,000 and 9% above that.

No Ministry of Finance or Federal Tax Authority document treats offshore companies as exempt, and none names offshore companies specifically. How the law applies to income from a property or a shareholding depends on the facts, so take tax advice on your own case.

Good to knowA Dubai offshore company does not by itself end your tax obligations at home. US citizens and resident aliens are taxed on worldwide income, UK residence is decided by the Statutory Residence Test, and in the EU national law and tax treaties decide. Take advice from a qualified adviser in your home country before you set one up.

How do you set up a Dubai offshore company?

You set up a Dubai offshore company through a registered agent approved by JAFZA. JAFZA states that offshore company registration must be processed through its registered agents only.

JAFZA's own fee for incorporation is AED 10,000, and its stated processing time for a new offshore company is 5 to 7 working days. The registered agent's fee is separate.

The Jebel Ali offshore page lists the documents, the officers the company needs and what it must do each year.