How to set up a RAKICC offshore company
Offshore jurisdictions have traditionally been used by wealthy individuals and multinational corporations as a way to benefit from favourable tax regimes. They offer a high degree of confidentiality and structuring flexibility with relatively little regulatory and administrative burden or compliance requirements.
Though typically used by high-net-worth individuals (HNWIs) and international corporations, offshore jurisdictions can benefit a variety of other individuals and businesses and are a viable alternative to other mainland or free zone options.
The UAE is becoming increasingly popular as a destination for offshore company registration and Ras Al Khaimah International Corporate Centre (RAKICC) is a jurisdiction with a strong value proposition that is worthy of consideration.
Why RAKICC?
As one of the fastest growing international registries, RAKICC’s value lies in its combination of tax efficiency, ease of doing business, global connectivity, legal protection, and flexibility. It allows investors to set up with 100% foreign ownership and no restrictions on the types of shares or shareholders. It also waives the usual requirement for minimum capital requirements or filing of financial accounts. This removes much of the administrative stress that so often accompanies business setup, allowing investors to focus 100% on their business’s revenue generating activities.
There are a several types of corporate structures that can be used in RAKICC and all are governed by common law legislation which provides the security of a familiarity of a recognised legal system and full compliance with all local and international laws.
What types of corporate vehicles does RAKICC offer?
There are a number of different offshore corporate vehicles available in RAKICC. Below are some of the main ones and their primary applications.
International Business Company (IBC)
An IBC is a popular offshore corporate structure that is commonly used for international trade, investment, and asset holding. One of the primary benefits of an IBC is that it provides confidentiality and asset protection for its owners. IBCs also typically have lower administrative and compliance costs compared to other corporate structures.
A RAKICC IBC can be 100% foreign-owned and can conduct business internationally though it is not permitted to carry out business within the UAE. It is also not subject to UAE corporate taxation, provided that it meets certain requirements.
It’s important to note, however, that IBCs may be subject to taxes in their country of residence or where their income is generated. The tax laws and regulations in the country of residence of the IBC’s owners and the countries where they do business will determine the tax obligations of the IBC.
Special Purpose Vehicle (SPV)
A RAKICC Special Purpose Vehicle (SPV) is a legal structure which is used to isolate assets and liabilities from a parent company. SPVs are often used in complex business transactions, including securitization, structured finance, and mergers and acquisitions.
RAKICC SPVs can be set up as companies or limited partnerships, and they must meet certain requirements, including a clear and specific purpose, a fixed duration, and a limited scope of activities. They are also required to have a registered office in RAKICC and a local registered agent to act as a liaison with the authorities.
One of the primary advantages of using a RAKICC SPV is that it provides legal and financial protection for the parent company. By establishing a separate legal entity for a specific purpose, the parent company can separate the risks and liabilities associated with that activity from the parent company.
RAKICC SPVs also benefit from the tax-efficient environment of RAKICC, which offers a business-friendly regulatory framework and tax exemptions for offshore companies.
Holding Company
A holding company is a legal entity that is used to hold assets.
These can include shares in other companies, intellectual property, or real estate. The primary function of a holding company is to control and manage the assets of the group of companies it owns and reduce the legal and tax liability of its subsidiaries.
A RAKICC Holding Company can be established as an International Business Company (IBC) or a Free Zone Company (FZC) and can hold shares in other companies in different jurisdictions. RAKICC offers a tax-efficient environment for holding companies, with no corporate tax, no withholding tax, and no capital gains tax.
One of the primary advantages of establishing a RAKICC Holding Company is that it can provide legal and financial protection for the assets it holds. By setting up a separate legal entity to hold the assets, the parent company can limit its liability and manage risks.
Family Office
Family Offices are entities used to manage the wealth and affairs of high-net-worth families. A family office typically provides a wide range of services, including investment management, wealth planning, tax management, asset protection, philanthropy and family governance.
RAKICC offers a range of options for structuring family offices, including single-family offices, multi-family offices, and hybrid structures, all of which are well protected within a well-regulated legal and financial framework.
How to set up a offshore business in RAKICC
- Choose a business activity: Decide on the type of business activity you want to undertake and ensure that it’s permitted under RAKICC’s regulations.
- Choose a business structure: Choose a suitable business structure, such as an International Business Company (IBC), Free Zone Company (FZC), or Special Purpose Vehicle (SPV). Consider the ownership structure, liability, and tax implications of each option.
- Choose a business name: Choose a unique and suitable name for your company that complies with RAKICC’s regulations.
- Prepare and submit application: Prepare and submit your application to RAKICC, along with the required documentation, such as a copy of your passport, proof of address, and a business plan.
- Pay fees: Pay the required registration and incorporation fees to RAKICC.
- Obtain approval: Await approval from RAKICC, which typically takes around 2-3 days.
- Receive certificate of incorporation: Upon approval, you will receive a certificate of incorporation, which confirms that your company is registered with RAKICC.
- Set up a bank account: Open a bank account for your company in a suitable jurisdiction.
- Receive necessary licences and permits: Issuance of all licences and permits needed to begin operating your business.
How can Global Link Help?
It is important to seek professional advice and guidance to ensure that you comply with all relevant laws and regulations when setting up an offshore business in RAKICC.
Global Link has over 16 years’ experience working with local and global businesses, providing bespoke consultancy services for company incorporation in Dubai and the wider UAE. We can assist you with setting up an offshore company in RAKICC, providing support throughout the whole process and liaising with all relevant parties on your behalf.
If you need advice on this or any other aspect of company incorporation, PRO services or visa acquisition, please get in touch with us on +971 4 553 9901 or email us at [email protected] and we will be happy to assist you.