Overview of JAFZA offshore jurisdiction
JAFZA offshore is a type of an offshore company registered by a Jebel Ali Free Zone in Dubai.
Until recently it was the only offshore company which could hold real estate property in Dubai. This feature made JAFZA offshore company setup highly demanded by property owners.
The situation has changed now and the property can be registered under a cheaper entity RAK offshore company.
Office
JAFZA offshore cannot have any office or facilities in the UAE rented under its name.
As any offshore company, it has a legal address of its Agent.
Such a company is not allowed to carry out the business in the country of its incorporation in the UAE. It can do business on the international scale only.
Jebel Ali offshore can have a UAE bank account. The account can normally be managed online; most of the banks have an internet banking facility. Some banks provide debit cards as well.
Company activities
Business activities for JAFZA offshore company formation are not grouped or limited to any specific category. It means that the company can have a broad variety of activities.
It is still recommended to group activities and name them precisely. It will help when you apply for a bank account.
JAFZA offshore company setup costs
If you are setting up an offshore, JAFZA company setup cost will slightly differ depending on the registered Agent you choose.
The average fee is about 18,000 AED (4,930 USD).
JAFZA offshore company formation
Jebel Ali offshore company formation can be done only by a registered Agent. It means that you cannot do it directly with the government authority by yourself.
The registered Agent can be a business setup company in Dubai who will take care of the paperwork and the registration process.
Jebel Ali offshore company is usually registered within 1-2 weeks depending on compliance approval.
Your personal visit for signature verification is required. If a company director is a different person, their visit is also mandatory.
Note: offshore company registration in Dubai requires 2 directors only in case it’s a JAFZA offshore. Any other companies in different UAE authorities need only 1 director.
Resident visas
JAFZA offshore company, as any other offshore company in the UAE, is not eligible for UAE resident visas.
In case you need a resident visa, you have to consider other options of business setup in Dubai in free zones or the mainland. You can check business setup in UAE in any emirate as long as your company is registered at least in a free zone.
License renewal
JAFZA offshore company renewal is done by your registered Agent. Your personal presence is not required.
You only need to transfer the funds to the Agent, who will do the formalities. Upon renewal, you will receive a Certificate of good standing, which serves as a formal proof that your company is active.
The price of the renewal is usually about 11,000 AED (3,015 USD) depending on your Agent.
Amendments
Amendments, just like setup and renewal, can be done only through the Agent.
Standard amendments include:
- Shares transfer
- Activity change
- Company name change
- Director change and others
You do not have to be in the UAE to process those amendments unless it’s a shares transfer. But even that can be done by your Аgent if you provide a Power of Attorney to sign on your behalf.
JAFZA offshore license liquidation
If you want to close your JAFZA offshore company it is advisable to do a formal procedure of liquidation through your Agent.
Some people keep their offshore companies non renewed after a while they get struck off the register automatically.
However, if you need proof that your company has been closed and has no liabilities, an official liquidation needs to be done.
It would cost about 8,000 AED (2,200 USD) and take about 1 month. Formalities can be done by your Аgent, but you need to make sure that:
- You return original company documents to your Agent
- You close corporate bank account
Dubai business setup experts opinion
JAFZA offshore company is a time-proven instrument of doing an international business.
JAFZA is not a monopolist of registering companies for Dubai property holding purposes anymore, but it remains a stable and popular place of UAE business registration.
Top questions about JAFZA offshore company
Yes, offshore companies have to be renewed annually. The cost of the renewal is $2,150 including Certificate of Good Standing, which serves as a formal proof of the company renewal. Usually we deliver this certificate to the bank in order to update the records and make sure the account of the company stays active.
No, offshore companies are not entitled for resident visas.
There are a few major differences:
- An offshore company is not allowed to do business in the UAE, but a free zone company can import goods and provide services in the territory of the UAE.
- An offshore company is not eligible for UAE resident visas, whereas a free zone company is usually entitled for resident visas.
- А Free Zone company may be liable for VAT if it does business in the UAE, but an offshore company never has to pay UAE VAT.
- An offshore company is the cheapest type of UAE corporate entity, and any free zone would always cost higher.
UAE is free from income tax and corporate tax. It only has import tax 5% for the goods that you bring into the country, and VAT 5% for the trading or service transactions that happen in the UAE. But since an offshore company cannot import any goods to the UAE, it is exempted from import tax too.
No, an offshore company is not liable for VAT, because its business can be carried out only outside of the UAE, thus UAE VAT does not apply. It also doesn't have to be registered with the Federal Tax Authority.
Documents
| DOCUMENTS | PROCEDURE | |
|---|---|---|
| No visa options | Passport copy | 1-2 weeks - company formation |
| Latest utility bill as address proof | ||
| CV |
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