TRW & Co · Company formation
RAK ICC Offshore Company Setup: Uses, Limits and Tax in 2026
A RAK ICC offshore company is a Ras Al Khaimah international business company built to hold shares, property and intellectual property, not to trade in the UAE. It needs a licensed registered agent, cannot sponsor visas or run a local office, and must now register and file for UAE corporate tax. This guide explains its uses, limits and alternatives.
Key pointSince corporate tax, a UAE-incorporated offshore company is a resident taxable person: the real choice is between a light holding vehicle and an operating licence, not between tax and no tax.
At a glance
Holding, not trading
A RAK ICC offshore company can hold shares, IP, bank accounts and approved property, but it cannot sell goods or services to UAE customers or run an operating office.
Registered agent mandatory
Every company must act through a RAK ICC licensed registered agent, which files documents, keeps beneficial ownership data and handles renewals under the 2018 regulations.
Dubai freehold property
RAK ICC companies with individual shareholders can register Dubai freehold property with a RAK ICC NOC, subject to Dubai Land Department documentary requirements.
Corporate tax applies
The FTA treats UAE-incorporated offshore companies as resident juridical persons, so registration and annual returns are required even for passive holding vehicles.
No residence visas
A RAK ICC registration does not support residence visas or employment; founders who need residency use a free zone or mainland entity, or another visa route.
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RAK ICC offshore company: the short answer
A RAK ICC offshore company is an international business company registered with the Ras Al Khaimah International Corporate Centre, a government-owned registry operating under common-law style regulations. It is designed to hold assets, not to run a UAE business. It can own shares, intellectual property, bank accounts and, with the right approvals, real estate in designated areas, but it cannot trade with customers in the UAE, lease an operating office or sponsor residence visas for staff.
That makes it a useful holding, property and special purpose vehicle, and a poor choice for anyone who wants to sell goods or services in Dubai or Abu Dhabi. Since corporate tax arrived, it is also no longer a "zero-filing" structure: a UAE-incorporated offshore company is a resident taxable person that must register with the Federal Tax Authority and file returns.
This guide explains how the RAK ICC regime works, what the company can and cannot do, how ownership, banking, beneficial ownership and tax operate in 2026, and how it compares with a JAFZA offshore company and an ordinary free zone licence.
The legal framework
RAK ICC is the Ras Al Khaimah government's corporate registry for international companies. Its rules and regulations page lists the instruments that govern it today:
- RAK ICC Business Companies Regulations 2018, which set out how companies are incorporated, governed, restructured and struck off.
- RAK ICC Registered Agent Regulations 2018, which regulate the licensed agents through whom every company must deal with the registry.
- RAK ICC Foundations Regulations 2019, amended in 2025, for private foundations used in family wealth planning.
The federal Commercial Companies Law does not govern RAK ICC companies, but federal law still reaches them in the areas that matter most: corporate tax, anti-money laundering, beneficial ownership and sanctions. A RAK ICC company with a bank account or property in the UAE sits inside that federal perimeter whether or not it ever trades here.
Entity types
RAK ICC's list of company types includes companies limited by shares, companies limited by guarantee, restricted purpose companies (typically used as SPVs), segregated portfolio companies, unlimited companies, intellectual property holding companies, holding companies and foundations, together with a transfer of domicile route for companies moving in from another jurisdiction. Most private clients and groups use the standard company limited by shares.
What a RAK ICC offshore company can and cannot do
The single most important rule is that a RAK ICC offshore company is not licensed to carry on business in the UAE. It can contract with foreign counterparties, hold investments and own UAE assets, but it cannot invoice UAE customers for goods or services, employ a UAE workforce or hold a commercial lease for an operating office. Regulated activities such as banking and insurance are excluded entirely.
| Use | Generally possible? | What to watch |
|---|---|---|
| Holding shares in UAE or foreign companies | Yes | Mainland and free zone registrars may ask for legalised corporate documents and UBO details |
| Owning real estate in Dubai freehold areas | Yes, subject to approvals | Dubai Land Department rules and an NOC from RAK ICC; disposal and transfer costs apply |
| Holding intellectual property and licensing it | Yes | Transfer pricing and corporate tax on royalty income |
| Opening a UAE bank account | Yes, at the bank's discretion | Enhanced due diligence; banks expect a clear purpose and source of funds |
| Trading with UAE customers or running an office | No | Requires a mainland or free zone licence |
| Sponsoring residence visas | No | Founders and staff need a licensed operating entity or another visa route |
| Banking or insurance business | No | Regulated by the Central Bank or financial free zone regulators |
In early 2025 RAK ICC announced that eligible international companies can obtain a RAK ICC free zone commercial licence and a Ras Al Khaimah Economic Zone (RAKEZ) address, giving them a route to operate within the free zone. That is a separate licence with its own conditions. A plain RAK ICC registration on its own still does not authorise trading.
The registered agent's role
Every RAK ICC offshore company must appoint a registered agent licensed by RAK ICC and keep a registered office in the UAE through that agent. You cannot deal with the registry directly. The agent:
- files the incorporation application, name reservation and constitutional documents;
- conducts customer due diligence on shareholders, directors and beneficial owners under UAE anti-money laundering law;
- keeps the company's beneficial ownership information and provides it to the registry on request;
- handles annual renewals, amendments, share transfers and, eventually, strike-off or deregistration;
- receives official notices at the registered office.
Choose the agent carefully. If the agent resigns, fails to renew or loses its licence, the company can fall out of good standing quickly, and a company struck off for unpaid fees may lose access to its bank account or property title until it is restored. Check the agent's standing on RAK ICC's agents directory and agree in writing who is responsible for renewal deadlines.
How incorporation works
Incorporation is quick once due diligence is complete; the time goes into preparing documents and answering the agent's compliance questions. A typical sequence:
- Define the purpose. Confirm what the company will hold and that it will not trade in the UAE. This drives the entity type, share structure and tax analysis.
- Appoint a registered agent. Select a RAK ICC licensed agent and sign its engagement terms, including renewal and resignation provisions.
- Complete due diligence. Provide passports, proof of address, source of funds and wealth, and details of every beneficial owner and director. Corporate shareholders provide legalised constitutional documents.
- Reserve the name and file the constitution. The agent reserves the name and files the memorandum and articles, which can be bilingual, together with the registered office details.
- Receive the certificate and issue shares. RAK ICC issues the certificate of incorporation; the company issues share certificates and writes up its registers.
- Register for corporate tax and open accounts. Register on EmaraTax, set up bookkeeping and approach banks with a clear structure memo.
Owning property through a RAK ICC offshore company
Property holding is one of the most common reasons to use an offshore vehicle. Holding a villa or apartment in a company rather than personally can simplify succession, allow several family members to share ownership through shares, and make a later sale possible by transferring the company rather than the title, subject to the rules of the relevant land department.
In Dubai, the Dubai Land Department accepts registration of freehold property in the name of approved offshore and free zone companies. Under the 2019 arrangement between RAK ICC and the Dubai Land Department, RAK ICC companies with individual shareholders can register Dubai freehold property without a Dubai trade licence, provided they hold an NOC from RAK ICC and meet the department's documentary requirements, including Arabic translations of corporate documents. Expect the department to look at the current constitutional documents, good standing and incumbency certificates and the identity of the authorised signatory.
Two cautions. First, a share sale of a property-owning company is not automatically free of transfer fees or scrutiny; check the current land department position before you rely on it. Second, rental income and gains from UAE property are UAE-source income for corporate tax. See our guides to buying property in Dubai as a foreigner and the Golden Visa: property held through a company can count towards the AED 2 million property route only where ICP's ownership rules are met.
Corporate tax, UBO and banking in 2026
Corporate tax
The Federal Tax Authority has confirmed, in public clarification guidance issued in 2024, that companies incorporated in the UAE, including those described as offshore, are resident juridical persons for corporate tax. A RAK ICC offshore company must therefore register on EmaraTax, keep proper accounts and file an annual return, even if its only activity is holding a single investment.
Taxable income above the AED 375,000 band is taxed at 9 per cent unless an exemption or relief applies. Dividends and qualifying capital gains from shareholdings can benefit from the participation exemption, and small business relief, extended to tax periods ending on or before 31 December 2029 by Ministerial Decision No. 131 of August 2026, may help a small company with modest revenue. Rental income from UAE property is taxable in the company.
In 2026, leading advisers reported that RAK ICC had been added to the list of free zones for corporate tax purposes with retrospective effect. If confirmed for your structure, a RAK ICC entity could in principle be a qualifying free zone person, paying 0 per cent on qualifying income, but only if it meets the substance, audited accounts, transfer pricing and de minimis conditions. Most passive holding vehicles will need careful analysis before claiming that status. See our guide to qualifying free zone persons.
Beneficial ownership
UAE beneficial ownership rules under Cabinet Decision No. 109 of 2023 require companies to identify the natural persons who ultimately own or control them and to keep that information current. For a RAK ICC offshore company the registered agent holds the data and supplies it to the registry; it is not published. Nominee arrangements must disclose the real owner. Our UBO rules guide explains thresholds and updates.
Bank accounts
UAE banks do open accounts for RAK ICC companies, but they apply enhanced due diligence. Expect to explain why the company exists, where its money comes from, who controls it and why the UAE is the right place. A pure holding company with no UAE activity, no tax registration and foreign directors will find this harder. See opening a corporate bank account in the UAE.
The old pitch for offshore companies was "no tax, no filing, no audit". That is no longer accurate. Budget for corporate tax registration, annual accounts that support the return, a possible audit, UBO maintenance and the registered agent's fees before choosing RAK ICC over a free zone company that could do more.
RAK ICC vs JAFZA offshore vs a free zone company
RAK ICC and the Jebel Ali Free Zone offshore regime are the two main UAE offshore registries. Both use registered agents, prohibit onshore trading and are commonly used to hold Dubai property. The differences lie in cost, corporate formalities and how each sits within the corporate tax free zone framework. JAFZA confirmed its free zone status for corporate tax purposes earlier than RAK ICC, and its offshore rules impose more formalities, including the appointment of an auditor.
| Feature | RAK ICC offshore | JAFZA offshore | Free zone company |
|---|---|---|---|
| Trade in the UAE | No | No | Within the zone and internationally; onshore only via permitted routes |
| Office and visas | No | No | Yes, linked to office space |
| Registered agent | Mandatory | Mandatory | Not usually |
| Dubai freehold property | Yes, with RAK ICC NOC | Yes, subject to DLD rules | Yes for approved zones |
| Corporate tax | Resident; free zone status reported in 2026 | Resident; zone recognised as a free zone | Resident; QFZP regime may apply |
| Typical use | Holding, property, IP, SPV | Holding and property, often for larger groups | Operating business |
If you need to sell, hire or sponsor family members, start with a free zone company or a mainland company. If you need a vehicle to own an investment or a property cleanly, a RAK ICC offshore company is often the lighter option. Many groups use both: an operating free zone company owned by a RAK ICC holding company.
Illustrative scenario
Illustrative only; generic parties. Two siblings living abroad inherit capital and want to buy an apartment in a Dubai freehold area and hold minority stakes in two private companies. They incorporate a RAK ICC offshore company limited by shares through a registered agent, each holding half the shares, with a shareholders' agreement covering deadlock and exit.
The company obtains an NOC from RAK ICC and registers the apartment with the Dubai Land Department. It registers for corporate tax, keeps accounts and files returns: rental income is taxable, while dividends from the shareholdings are assessed under the participation exemption rules. Because neither sibling lives in the UAE, they appoint a Dubai-based authorised signatory for land department matters and agree with the bank a clear explanation of the structure. When one sibling later wants to exit, the shareholders' agreement and the RAK ICC share transfer process provide the route.
Risks and common mistakes
Using the company to trade in the UAE
Invoicing UAE customers, signing local supply contracts or hiring staff through a RAK ICC offshore company breaches its licence terms and exposes the business to penalties from the economic department of the emirate where the activity takes place. It can also undermine the company's tax position and banking relationship. If the business model involves UAE customers, use a licensed operating entity and let the offshore company own it.
Assuming there is nothing to file
Corporate tax registration and annual returns apply to UAE-incorporated offshore companies. Missing the registration deadline or a return attracts administrative penalties, and penalties can block later changes such as a share transfer or deregistration. Keep accounts that support the return and decide early whether an audit is needed, for example if you plan to claim free zone treatment.
Letting the registered agent relationship lapse
A company without a valid registered agent cannot renew, amend or prove good standing, and can be struck off. A struck-off company may lose the ability to deal with its bank account or property. Diarise renewal dates, keep the agent's fees paid and transfer to a new agent formally rather than simply stopping payment.
Weak beneficial ownership and source of funds records
Banks, the Dubai Land Department and the registered agent all ask who owns the company and where the money came from. Inconsistent answers, undocumented nominee arrangements or unexplained transfers delay account opening and property registration and can trigger suspicious transaction reports. Keep a clean file of ownership, funding and decision-making from the start.
What to do next
- Write down exactly what the company will hold and whether it will ever need to trade, hire or sponsor visas.
- Compare a RAK ICC offshore company with JAFZA offshore and a free zone company on cost, formalities and tax.
- Choose a licensed registered agent and agree service levels and renewal responsibilities.
- Plan corporate tax registration, accounting and any audit before incorporation.
- For property, confirm the land department's current requirements and the NOC process before signing a purchase agreement.
- Put a shareholders' agreement and succession plan in place, especially for family structures; see our holding company guide and foundations and trusts guide.
TRW & Co advises on structuring, constitutional documents, shareholder arrangements, property holding and corporate tax analysis alongside the company's registered agent and accountants. Contact us at info@trw.co or +971 58 942 1012.
Frequently asked questions
01Can a RAK ICC offshore company do business in the UAE?
No. A RAK ICC company is not licensed to carry on business with customers in the UAE, lease an operating office or employ a local workforce, and banking and insurance activities are excluded. It can hold shares in UAE companies, own approved property, hold IP and keep UAE bank accounts. If you need to trade locally, set up a free zone or mainland company, which the RAK ICC company can own. RAK ICC also offers a separate free zone commercial licence route with RAKEZ for eligible companies.
02Does a RAK ICC offshore company pay UAE corporate tax?
It must register and file. The Federal Tax Authority treats companies incorporated in the UAE, including offshore companies, as resident juridical persons. Taxable income above AED 375,000 is taxed at 9 per cent unless an exemption applies; dividends and gains from qualifying shareholdings may be exempt, and rental income from UAE property is taxable. RAK ICC was reported in 2026 to have been added to the free zone list for corporate tax, but qualifying free zone status depends on meeting strict conditions.
03Can a RAK ICC company own property in Dubai?
Yes, in freehold areas and subject to approvals. Under the arrangement between RAK ICC and the Dubai Land Department, RAK ICC companies with individual shareholders can register Dubai freehold property without a Dubai trade licence if they obtain an NOC from RAK ICC and provide the department's required documents, including Arabic translations of corporate papers and good standing certificates. Check the current requirements before signing a sale and purchase agreement, and plan for the corporate tax treatment of rental income and gains.
04Can I get a UAE residence visa through a RAK ICC offshore company?
No. A RAK ICC registration does not come with an office or visa quota, so it cannot sponsor residence visas for owners or staff. Founders who need residency usually set up a free zone or mainland company, or use routes such as the Golden Visa. The Golden Visa property route requires property worth at least AED 2 million and offers a 10-year visa, and ICP applies its own rules where property is held through a company.
05What is the role of a RAK ICC registered agent?
The registered agent is your only channel to the registry. It incorporates the company, provides the registered office, carries out anti-money laundering due diligence on owners and directors, holds beneficial ownership information, files amendments and share transfers and handles annual renewals. If the agent relationship lapses or renewal fees go unpaid, the company can lose good standing and eventually be struck off, which can affect bank accounts and property title. Choose a well-established agent and agree responsibilities in writing.
06Is a RAK ICC company better than a JAFZA offshore company?
It depends on the use. Both registries require a registered agent, prohibit onshore trading and are used to hold Dubai property. RAK ICC is usually lighter and cheaper to maintain, while JAFZA offshore companies carry more formalities, including the appointment of an auditor. JAFZA was recognised as a free zone for corporate tax purposes earlier. For a family property or investment holding vehicle, RAK ICC is often sufficient; for larger group structures, compare both with a tax adviser.
Sources and official materials
- RAK International Corporate Centre — Registry home: entity types, agents and guidance
- RAK ICC Rules and Regulations — Business Companies and Registered Agent Regulations 2018, Foundations Regulations
- RAK ICC: Types of companies — Companies limited by shares, SPVs, segregated portfolio and holding companies
- Federal Tax Authority — Corporate tax registration, returns and public clarifications
- Dubai Land Department — Registration of property owned by companies in Dubai
- Jebel Ali Free Zone (JAFZA) — Alternative offshore and free zone company regime
General information only, current as at 27 October 2026. It is not legal advice and does not create a lawyer–client relationship. UAE law differs between the onshore jurisdiction, the DIFC, ADGM and the free zones, and changes frequently; check current official sources and take advice on the facts of your matter.
