Due to its innovation-friendly climate, technological advancements, and business-friendly policies, every businessperson wants a portion of the Dubai success story on their plate. The global business hub has many benefits to offer entrepreneurs, including tax exemptions, streamlined documentation, and government grants.
Dubai offers three primary business models: Free Zone, Mainland, and Offshore. This blog explores whether an offshore company can own property in Dubai. Before beginning with the answer to this question, let’s understand what an offshore business is and how it works.
What is an Offshore Company?
An offshore company is a venture registered in a foreign country. These countries have favourable financial, legal, and regulatory conditions. In simple terms, an offshore company is a business incorporated in a country other than the country of residence for its owners or operators.
These companies are often established for multiple reasons. Interestingly, new entrepreneurs and businesspeople frequently choose modern cities like Dubai to launch their ventures. The primary reason for this step is the UAE government's interest in promoting business growth and tax advantages.
The offshore business model has gained popularity in the past few years. Multinational corporations, HNIS, and potential entrepreneurs choose this model because it offers various financial and operational benefits. It enables companies to reduce tax obligations, enhance privacy, and more effectively enter international markets.
Some reports suggest that an offshore company cannot own a property in Dubai, while others state that it can. Let's delve into the right information—if they can own it, then how, and if they can't, then why?
Do Offshore Companies Have the Right to Hold Property in the UAE?
The straight answer to this question is yes. An offshore company can own a property in Dubai, but there's a twist. These companies can purchase or manage properties in certain designated zones.
For example, offshore companies incorporated under free zones, such as the RAK International Corporate Centre (RAK ICC) and the Dubai International Financial Centre (DIFC), can purchase property within a designated zone. Commercial real estate or freehold homes might be the choice for a foreign investor.
- The different jurisdictions for an offshore company and its legal structure will determine the type and location of the properties it may hold.
- Most people assume that free zones and offshore companies are the same, but they are not. A free zone has its own set of benefits, and offshore companies have their own.
- UAE Offshore Companies are quite different from Free Zone Companies. A Free Zone Company is an onshore corporation that is allowed to operate in Dubai under specific restrictions.
- The offshore companies grant their directors, shareholders, and staff the right to live in the UAE even though, like all entities, they pay corporation tax at zero. RAK ICs and JAFZA Offshore Companies are required by Local Company law to appoint an approved registered agent before commencing business in Dubai.
Places Where Offshore Companies Can Own Properties
An offshore company can own a property at a limited number of listed properties in Dubai-
- Al Barari
- Arabian Ranches
- Business Bay
- City Walk
- Downtown Dubai
- Dubai Marina
- Jumeirah Lake Towers (JLT)
- Meydan City
- Mirdif Hills
- Palm Jumeirah
- The Lakes
- Tilal Al Ghaf
- Victory Heights
In those places, flats and villas are mostly sold as freehold properties. In these freehold places, commercial land can be owned by offshore companies. The freehold areas will also be assigned to each emirate.
Key Advantages of Property Ownership in the UAE for Offshore Companies
Like free zones and mainland business areas, offshore companies also benefit from owning property in Dubai. These includes;
- Tax Exemptions
- Foreign Ownership
- Confidentiality
- Security
- Simplicity
- Regulations
In an ever-evolving time, businesses are striving to thrive in a tough, competitive landscape through informed choices and decisions. The offshore business model is booming among entrepreneurs who aim to establish an international company in a country that offers a favourable business ecosystem.
It is essential to leverage this benefit, seek professional assistance to capitalise on the advantage, and ensure that your offshore companies are well-structured and compliant with all relevant regulations.
At Markai Corporate Services, we handle everything your offshore business needs. From assisting with business incorporation to finding suitable and legally compliant properties, we guide you throughout the entire process.
Our well-versed experts meticulously handle the complexities of offshore settings, real estate investing, tax planning, and UAE business ownership, ensuring a quick and straightforward procedure.