Offshore company formation is becoming increasingly popular among businesses looking to grow their functions overseas. One of the most sought-after destinations for offshore company formation is the United Arab Emirates (UAE), specifically the Offshore company formation in Ras Al Khaimah (RAK). RAK is located in the northern part of the UAE and is known for its strategic location, favorable business environment, and low cost of living. In this blog post, we’ll take a closer look at the process of offshore company formation in RAK.
The Process for Offshore Company Formation in Ras Al Khaimah
1. Choosing a Registered Agent
The first step in company formation in RAK is to choose a registered agent. The registered agent is a company or individual authorized by the RAK International Corporate Centre (RAKICC) to act as an intermediary between the offshore company and the RAKICC. The registered agent will handle all the paperwork and legal requirements associated with offshore company formation.
2. Choosing a Company
Name The next step is to choose a company name for RAK offshore company registration. The company name should be distinctive and not similar to any current company name in RAK. The company name must also comply with the RAKICC’s naming guidelines, which include rules on language, punctuation, and offensive or misleading names.
3. Filing the Application
Once you have chosen a registered agent and a company name, the next step is to file an application with the RAKICC. The application will include all the necessary information about the company, such as the registered office address, the nature of the business, the share capital, and the names of the shareholders and directors.
4. Obtaining a Business License
After the application is approved, the next step is to obtain a business license. The type of license required will depend on the nature of the business. RAKICC offers three types of licenses: commercial, professional, and industrial license. The commercial license is for companies engaged in commercial activities, while the professional license is for companies providing professional services. The industrial license is for companies engaged in manufacturing or industrial activities.
5. Opening a Bank Account
Once you have obtained a business license, the next phase is to open a bank account in the name of the offshore company. This will enable you to conduct business transactions and receive payments from clients. RAK has a number of local and international banks that deliver an array of banking services to offshore companies.
6. Registering for Taxation
Offshore companies in RAK are not subject to taxation. Nonetheless, they are needed to register with the relevant authorities to obtain a tax residency certificate. This certificate will enable the company to do business in other countries and avoid double taxation.
7. Renewing the License
Offshore companies in RAK are required to renew their business license yearly. The renewal process involves submitting all the essential documents and spending the appropriate fees.
Benefits of An Offshore Company Formation in Ras Al Khaimah
Offshore Company Formation in Ras Al Khaimah (RAK) has gained significant popularity in recent years, as it offers numerous benefits for entrepreneurs and investors. Here are some of the essential advantages of setting up an offshore company in RAK:
1. Taxation Benefits
One of the most noteworthy advantages of offshore company formation in RAK is the favorable tax regime. Offshore companies registered in RAK are exempt from corporate and income taxes. This means that you can invest your profits back into your business or use them personally.
2. Asset Protection
Offshore companies in RAK provide a high level of asset protection to investors. RAK is known for its strict confidentiality laws, which ensure that your assets and investments remain safe and secure. This is particularly important for high-net-worth individuals who want to protect their assets from legal disputes, creditors, and other risks.
3. Foreign Ownership
RAK allows 100% foreign ownership of companies, which means that you can own and operate your business without any local partner or sponsor. This is in contrast to other UAE jurisdictions where foreign ownership is limited to 49% for certain industries. This freedom of ownership is a major advantage for foreign investors who want to have full control over their businesses.
4. Easy Company Formation
Ras Al Khaimah Offshore Company Formation is a quick and straightforward process. The entire process can be completed within a few days, and you do not have to go through complex procedures or fulfill minimum capital requirements. This makes RAK an attractive destination for entrepreneurs who like to set up their companies quickly and efficiently.
5. Strategic Location
RAK is strategically located between Europe, Asia, and Africa, making it an excellent hub for international trade and business. The Emirate is well-connected to major transportation hubs, including airports and seaports, which provides easy access to global markets. Additionally, RAK offers a business-friendly environment with modern infrastructure, world-class amenities, and a skilled workforce.
6. Business Expansion
Offshore companies in RAK can expand their business to other UAE jurisdictions and access the local market without any restrictions. This provides an excellent opportunity for businesses to expand their operations and take advantage of the growing economy in the region.
7. Bank Account Opening
Offshore companies in RAK can easily open bank accounts in the UAE and other international jurisdictions. This allows businesses to access international markets, receive payments, and handle their finances virtually.
Documents Required for an Offshore Company Formation in Ras Al Khaimah
For RAK offshore company registration, you will need to provide several documents, which include –
- Application form – This is the initial form you will need to fill out and submit to the Registrar of Companies in Ras Al Khaimah.
- Passport copies – You will need to provide passport copies of all shareholders, directors, and company officers.
- Proof of residence – You will need to provide a copy of a recent utility bill or bank statement showing the residential address of each shareholder, director, and company officer.
- Bank reference letter – You will need to provide a letter from your bank confirming that you have a satisfactory relationship with them.
- Curriculum Vitae – You will need to provide a CV of all directors and company officers.
- Memorandum and Articles of Association – These are the documents that outline the company’s constitution, its objectives, and its internal regulations.
- Shareholder Declaration – You will need to provide a shareholder declaration, which states that the shareholder has paid the full amount of the shares issued to them.
- Power of Attorney – You may need to provide a Power of Attorney to authorize someone to act on your behalf during the incorporation process.
The Cost of an Offshore Company Formation in Ras Al Khaimah
The cost of offshore company formation in Ras Al Khaimah varies depending on several factors, such as the type of company, the scope of activities, and the services required from the formation agent. However, generally speaking, the cost of setting up an offshore company in Ras Al Khaimah is relatively affordable compared to other jurisdictions.
To give you an idea of the costs involved, here is a breakdown of the typical expenses for an offshore company formation in Ras Al Khaimah –
- License fee – The license fee depends on the type of company you want to set up, and it can range from AED 11,000 to AED 35,000.
- Registered agent fee – The registered agent fee can vary depending on the scope of services provided, but it typically ranges from AED 5,000 to AED 10,000 per year.
- Registered office fee – The cost of renting a registered office space can differ relying on the location and size of the office, but it generally ranges from AED 7,000 to AED 15,000 per year.
- Company formation fee – The cost of this service can vary depending on the scope of services provided, but it typically ranges from AED 8,000 to AED 15,000.
- Bank account opening fee – The cost of a bank account opening can vary depending on the bank you choose and the services required, but it typically ranges from AED 2,000 to AED 5,000.
Overall, the total cost of setting up an offshore company in Ras Al Khaimah can range from AED 33,000 to AED 70,000, depending on the factors mentioned above.
Conclusion
Offshore company formation in RAK offers businesses a number of benefits, including low taxes, a favorable business environment, and a strategic location. The process of setting up an offshore company in RAK is straightforward and can be completed within a few weeks. However, it is important to seek the advice of a registered agent or a professional consultant to ensure that all the legal requirements are met and the process is carried out smoothly.
