What Is RAK ICC Foundation?
Offshore foundations are structures used to transfer the legal ownership of property. Foundations combine the features of corporations (legal personality) and trusts (created for a specific purpose or benefit). They are versatile tools for asset management and tax planning. Establishing an offshore foundation allows personal or business affairs to be governed by the laws of a neutral country.
A RAK ICC Foundation is a legal entity separate from its founder(s), established under the Ras Al Khaimah International Corporate Centre (RAK ICC) in Ras Al Khaimah, UAE. It is managed by a council that oversees its assets and objectives. This foundation operates similarly to a trust and functions like a company but has no members or shareholders. Both individuals and companies can establish such foundations, which are commonly used for asset protection, estate planning, and wealth management.
These foundations, similar to offshore trusts, are established in jurisdictions with favorable offshore laws, making them tax-free and providing various advantages.
Why Setup A RAK ICC Foundation
- Better succession planning and asset protection
- Creates a strong government structure
- Becomes a guardian or supervisor of the entity, which creates accountability and protection to ensure the proper management and operation of the entity
- A distinct legality that separates liability while maintaining control of assets and has perpetual existence after the lifetime of the founder
- Holds assets
- Distributes profits from other companies
- Owns shares in RAK ICC companies
- Manage and retain the founder’s assets for the benefit of qualified beneficiaries
- Holds operating companies
- Family philanthropic purposes
- Private family wealth management
Key Features and Benefits of RAK ICC Foundation
Features of the RAK ICC Foundation:
Governing Law
The governing law for a RAK ICC Foundation is ‘RAK ICC Foundations Regulations 2019’.
1. Governing Jurisdiction
There are two options to choose from when it comes to the governing jurisdiction to follow under the RAK ICC Foundation:
- Abu Dhabi Global Market (ADGM) Courts
- Dubai International Financial Centre (DIFC) Courts
2. Incorporation Process
The criteria for incorporating a RAK-ICC Foundation include:
1. Founder (individual or corporate)
2. Council Members (individual or corporate)
3. Registered Agent
4. UAE-registered office
- If the foundation has charitable or specific non-charitable goals, a guardian (individual or corporate) must be appointed
- Submit a signed application form with details, a charter, and the By-Laws to the registrar
3. Minimum Capital
- USD 100 (or equivalent in other currencies)
- Additional contributions are allowed
4. Control Mechanisms
- Governed by Council Members as per the By-Laws (private document)
- The council must have at least 2 members (founder, family, trusted advisors, or professionals)
- Guardian (if appointed) ensures Council compliance with the By-Laws
5. Right to Information
- The registrar keeps a public register with basic details (name, registration date, founder, council members, registered agent)
- All other information is private and is disclosed only to authorities if required
6. Migration
- Foundations can move in or out of RAK ICC, subject to conditions
7. Annual Accounts
- A registered agent keeps accounting records at the registered office
- Records are private and not publicly disclosed
Advantages of RAK-ICC Foundation
- Internationally compliant registry
- Strong governance framework
- Attractive tax regime established in the UAE
- There is no necessity to file or audit accounts; however, the firm is still subject to RAK ICC AML rules as outlined in the RAK ICC Business Companies Regulations 2018.
- Possibility of relocating to RAK ICC from abroad
- Low registration and administrative expenses
- Flexibility regarding beneficiary classifications
- No requirement for physical presence
Possible RAK ICC Foundation Structure
Why Gatestone Group?
While there are numerous advantages to establishing a RAK ICC Foundation, it is crucial to consult with a qualified corporate service provider like Gatestone Group who can guide you through the process. For more details and a complimentary expert consultation on setting up a RAK ICC company or a RAK ICC Foundation, please contact us via email at [email protected] or call us at +971 4 450 1023 and start today!
Unlock the Potential of RAK ICC Foundations: Schedule a Free Consultation
Uncertain about how a RAK ICC Foundation can benefit your asset management strategy or philanthropic goals? Don’t wait! Schedule a free consultation with our RAK ICC specialists. The expert team at Gatestone Group will assist in answering all questions and helping you unlock the full potential of RAK ICC Foundations. Our team remains ready to empower you to achieve your objectives.
FAQs
A RAK ICC Foundation is a legal entity established in Ras Al Khaimah International Corporate Centre (RAK ICC). It combines features of trusts and corporations to manage assets, estate planning, and charitable activities.
Benefits include asset protection, privacy, estate planning, flexibility in management, and no corporate or income tax on foreign income.
Individuals and corporations, both UAE residents and non-residents, can establish a RAK ICC Foundation.
The foundation consists of a founder, council (similar to a board of directors), registered agent, and beneficiaries. It may also include a guardian to oversee the council.
To register a RAK ICC Foundation, it must be done through a RAK ICC registered agent like Gatestone Group. We will assist you in preparing the essential documents, submitting your application, getting the approval and receiving the official registration. It is highly recommended to consult with a lawyer specializing in RAK ICC foundation for legal advice and assistance tailored to your specific situation. The legal team at Gatestone Group will ensure your documents adhere to the regulations and guide you through the entire registration process smoothly.
Maintain accurate records, file annual returns, and comply with RAK ICC regulations. There is no requirement to publish financial statements.
Yes, the foundation cannot engage in commercial trading activities but can hold assets, invest, and manage properties.
No, there is no requirement for a physical office, but having a registered agent within the UAE is mandatory.
RAK ICC Foundation benefits from the UAE’s favorable tax regime, with no corporate or income tax on foreign income and no capital gains tax.