Opening a family office is an increasingly popular option for those thinking about wealth management. With its favourable tax environment, political stability, and world-class infrastructure, it’s no surprise that Dubai is at the forefront of people’s minds when it comes to family offices. In short, it’s an ideal base for establishing a family office as a way of allowing families to oversee investments, succession planning, philanthropy, and much more.
In this article, we’ll walk you through everything you need to know about opening a family office in Dubai. We’ll explore the types of family offices available, helping you determine which structure best suits your needs. You’ll also discover the key benefits of establishing a family office in Dubai, from tax advantages to access to a thriving financial ecosystem. Finally, we’ll discuss the costs involved, so you can plan effectively and make informed decisions throughout.
How to open a family office in Dubai: Step-by-step
Setting up a family office in Dubai requires careful planning and a clear understanding of the process. Families need to consider several factors, including the type of family office, legal structure, financial planning, and compliance with regulations. Let’s look at these in more detail now:
- Assessing family needs: Start by evaluating your family’s financial goals, risk tolerance, and long-term strategy. This ensures the family office is well-prepared for effective wealth management and succession planning. Adequate resources must be in place to cover operational costs and sustain the office over time.
- Choosing a structure: Families can opt for a Single-Family Office (SFO), serving one family, or a Multi-Family Office (MFO), which manages assets for multiple families. The decision depends on the family’s financial complexity and privacy needs. Registering the office in a UAE free zone requires a trade name approval, submitting shareholder documents, and obtaining a business license.
- Legal compliance: The office must adhere to free zone regulations and UAE Central Bank rules, ensuring compliance with tax laws and financial policies. Ongoing education for team members on regulatory changes is vital for maintaining smooth operations.
- Building a team: A successful family office relies on experts across fields like investment, tax, legal, real estate, and administration. Having the right team ensures the office can effectively manage wealth and achieve its goals.
- Leveraging technology: Robust technology for financial reporting, risk management, and portfolio tracking is crucial. This allows the family office to monitor performance and adapt to market changes efficiently.
- Governance and long-term planning: Establishing governance structures promotes transparency, accountability, and effective decision-making. A clear governance framework helps maintain family harmony and supports the office’s success across generations. Families must also focus on long-term wealth preservation to ensure sustainable growth and a lasting legacy.
Setting up a family office in Dubai is a significant commitment, but with thoughtful planning and the right support, it can provide a solid foundation for managing and growing family wealth.
Types of family offices in Dubai
Each type of family office offers unique benefits and approaches to wealth management. In this section, we will outline the main types of family offices in Dubai, including Single-Family Offices, Multi-Family Offices, and Virtual Family Offices – each tailored to meet the specific requirements of families:
- Single-Family Offices (SFOs): An SFO focuses exclusively on managing the wealth of one family, offering highly personalised financial strategies and complete control over investments. This structure ensures maximum privacy and allows the family to tailor solutions to their specific needs.
- Multi-Family Offices (MFOs): MFOs manage the wealth of multiple families, pooling their resources to benefit from shared services and broader investment opportunities. This model is often more cost-effective, making it appealing for families with smaller portfolios or those looking to diversify their investments through collaborative efforts.
- Virtual Family Offices: Virtual family offices operate remotely, using technology to manage wealth and provide services to families globally. This setup offers flexibility, giving families access to professional wealth management support from anywhere in the world without needing a physical office presence.
Benefits of establishing a family office in Dubai
From personalised financial strategies to access to exclusive investment opportunities, Dubai provides an ideal environment for managing and preserving family wealth. In this section, we’ll explore the key benefits of setting up a family office in Dubai, highlighting how the city’s business climate, financial expertise, and robust regulatory framework make it an attractive destination for affluent families.
- Tailored investment strategies: Aligned with the specific financial goals and risk tolerance of each family.
- Comprehensive wealth management: All-encompassing approach to wealth management, covering financial planning, estate management, tax optimisation, and philanthropic initiatives.
- High standards of privacy: Maintaining strict confidentiality, family offices in Dubai ensure that their clients’ financial affairs remain secure and protected from external scrutiny.
- Access to unique opportunities: Thanks to their extensive networks and market knowledge, family offices provide families with exclusive investment opportunities and valuable strategic partnerships.
- Planning for future generations: Family offices support long-term wealth preservation, helping families develop strategies to grow and sustain wealth across multiple generations.
Cost of setting up a family office in Dubai
Setting up a family office in Dubai typically costs between USD 15,000 to USD 20,000 for a single-family office and USD 40,000 to USD 47,000 for a multi-family office. However, these figures can vary depending on the specific needs and complexity of the family’s operations.
In addition to initial setup fees, families should account for ongoing expenses such as office rent, staff salaries, insurance, and other operational costs essential to running the office smoothly.
About Worldwide Formations
Since 2008, Worldwide Formations has been a leading provider of corporate advisory services in the region, offering comprehensive solutions for businesses, entrepreneurs, and families looking to establish or expand in the UAE.
With clients from over 90 countries, we are a trusted partner and an officially registered agent in all major UAE free zones. Our expertise extends to setting up family offices, helping families tailor their structures to meet specific financial goals and operational needs.
In addition to free zone, mainland, and offshore setups, we provide visa processing and second citizenship services. Through our global network of partners, we offer essential solutions such as accounting, taxation, financial audits, and international tax consulting.
If you’re considering opening a family office in Dubai, contact us today for professional guidance and bespoke support.
