An LLC is one of the most utilized ways of company formation in Dubai. This is because of its flexible nature and its many benefits. Most commonly used by foreign nationals, this entity does require the services of an authorized agent to open the offshore bank account. This enables the individual to have closer control over his money in the country where he is based.
Advantages of a Company formation:
One of the biggest benefits offered by this offshore financial vehicle is the ability to have corporate bank accounts. Individuals who wish to establish an entity in the emirate can choose between having a direct company or an indirect one. They can also use several offshore vehicles that allow them to enjoy the benefits of having corporate bank accounts, tax payment facilities, and the like.
There are several advantages associated with a direct formation in Dubai. First of all, the foreigners are not required to provide their details as they would need to do when setting up an office in the emirate’s capital. Moreover, foreigners can benefit from obtaining their own office space, if they choose to establish an offshore company in Dubai.
Another major advantage is that it is cheaper than putting up an office in the UAE or any other country. Companies that want to set up an office in Dubai do not have to pay for the services of a service agent as they would normally be paying an agent directly. On the contrary, foreigners who want to establish an offshore company in the emirate have to pay a service fee to a service agent who would then manage their account. This is why it is cheaper than having office space in the country.
The disadvantage of company formation:
However, there are also disadvantages to this. The biggest disadvantage associated with the formation in Dubai is that there are no free zones. This means that companies cannot trade or operate businesses freely within the free zones.
Company formation in Dubai that does not involve the operation of a free zone is not affected by the laws in the emirate. However, a company formation in the free zones is required to pay a customs duty on its goods. If you are going to establish an offshore company in the emirate, it is strongly recommended that you contact a corporate tax attorney who will be able to guide you on how to structure your company so that you will not have to pay the relevant customs duty.
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