What To Avoid When Setting Up An Offshore Formation In Dubai
An offshore company formation in Dubai is chosen every year by scores of organisations around the world and there are many things to avoid when doing so. Here is what not to do when incorporating an offshore company in Dubai:
Not appointing a director
Only one director has to be appointed who can hold any nationality. If an offshore company doesn’t appoint this individual beforehand, it cannot be incorporated. So that no time and expense is wasted, find someone who is willing to be a director. Many Formation Agents provide a nominee director service where details about an individual can be provided for a small fee.
Failure to register a bank account
The money which is in a Dubai bank account is what’s subject to zero taxation. If a bank account is not formed before the incorporation process begins, an offshore company won’t be able to benefit from a 0% rate of tax. Even if money is earned in Dubai and deposited in a bank account that is registered in another country, it will be taxed. By starting a bank account in Dubai, it can be used by an offshore company as soon as it has been incorporated.
Not hiring a Formation Agent
If an organisation hasn’t incorporated an offshore company before, they can receive help from a Formation Agent. Knowledgeable of the legal system in Dubai, they can do everything that’s required so that a company is incorporated within a couple of days. When an organisation is responsible for incorporating a company, it can take far longer.
Inability to raise enough capital
AED 1,000 ($270, £175) is the minimum Capital Requirement for an offshore company in Dubai. This is a small figure but if an offshore company doesn’t raise it, the Dubai government won’t allow an incorporation to happen. By raising this capital beforehand and depositing it into the bank account which will be used by an offshore company, an incorporation won’t be delayed at all. As a result, an application to incorporate a company in the Seychelles can proceed as normal and it won’t take longer than necessary. In fact, as the relevant capital has been raised, this potential hurdle won’t stand in an organisations’ way.
Raising inadequate Share Capital
A huge amount of Share Capital isn’t required to incorporate a company in Dubai. In all, £2,000 ($1,300) has to be raised. If it fails to do so, an offshore company cannot be incorporated. The Share Capital which is raised can be issued to one person and, by making suitable arrangements before the incorporation process begins, there won’t be any delays whatsoever.
Hiring an accountant
It can be expensive to hire an accountant. Updating corporate accounts, an accountant is not required at an offshore company formation in Dubai because the government there doesn’t carry out audits. Although corporate accounts can be updated, it doesn’t have to be done religiously and a ballpark figure can instead be provided for profits in a particular year.
This article was brought to you by http://dubai.offshoreformations247.com. For more information on setting up an offshore company visit the link.