Dubai flourishing economy provides a wealth of possibilities for starting a business. It may be advantageous due to Dubai’s strategic position, varied market, and business-friendly atmosphere. The procedure to start a business in Dubai is quite simple. Here, we will discuss how to start a business in Dubai in detail with numerous steps and essential considerations you should be aware of.
Whether you choose to complete the process on your own or seek the help of business setup experts to expedite the process, make sure you get sound advice regarding a ramification of your choices. The business setup in Dubai Emirates has three primary options: the Freezone, the Mainland, and the Offshore. Stay with us to explore more.
Why Start a Business in Dubai?
If you are looking to start a business in Dubai and the rest of the United Arab Emirates are the best places. There are several attractive factors that attract thousands of new business owners from all over the world to the United Arab Emirates and especially to Dubai.
The UAE has numerous programs aimed to help new businesses get off the ground such as start-up incubators and financial opportunities. Corporate tax rates in the UAE are among the lowest in the world at 9% for businesses and the Emirates has a 5% of Value added tax (VAT), it is the only major tax you need to be aware of.
The UAE stands in 23rd place as of the best countries to live in. There are many different fields available for entrepreneurs, such as healthcare, hotels, e-commerce, IT, and many more. Furthermore, Dubai’s business economy has a promising future.
If you are curious about how to start a business in Dubai. Following this guide will make it simple to start a company in Dubai UAE.
Types of Company
Dubai is a great place to start a business, whether you are an entrepreneur looking to expand your operations or an international investor looking to diversify your portfolio. There are many opportunities and a legal process to navigate when starting a business in this Dynamix metropolis. You can repatriate your whole investment with no currency conversion fees.
Business setup in Dubai Freezone
Free zones in Dubai are economic zones where foreign investors may hold up to 100 % of local businesses. These zones provide for complete repatriation, tax breaks, and streamlined custom clearance processes. Dubai Multi Commodities Centre (DMCC), Jebel Ali Free Zone (JAFZA), International Freezone Authority(IFZA) and Dubai Internet City are the few well-known free zones in Dubai.
International Free Zone Authority (IFZA) is one of the free zones on the eastern coast of the United Arab Emirates (UAE). IFZA free zone business setup consultants facilitates company formation and operations in its free zone. IFZA facilitates the establishment of businesses by issuing a variety of licenses to both individuals and businesses. These licenses allow for a wide variety of commercials.
In UAE, Dubai Free Zones are the only locations where foreigners can hold a total share of their business. The infrastructure in the free zone is ideal for doing business and a wide range of convenient services. Free Zone company formation in Dubai provides minimal taxes at best. You may have an unlimited number of shareholders without any restriction. You can also repatriate your entire investment without incurring currency conversion fees.
Business setup in Dubai Mainland
Mainland company formation in Dubai allows you to trade in any market within the UAE. Depending on the nature of your business, a local Emirati partner associate or service provider agency on hand may be essential, but this is only sometimes necessary. This business setup paves the way for expanded access to government procurement possibilities and market penetration. As a result, you can better serve your customers.
The Department of Economic Development (DED) helps in promoting economic growth since it is responsible for giving licenses and registering mainland businesses. It regulates to guarantee local law and a fair market. To avoid duplication, it approves commercial activity for each license, controls ownership structure, and enables business name approvals.
Business setup in Dubai Offshore
Businesses operating globally that value confidentiality and tax advantages will find an offshore company formation in Dubai an excellent choice. A UAE office is a valuable factor for managing international business activities and investments without requiring a permanent presence in the UAE.
How to Start a Business in Dubai – Company Formation Process
1. Business Activity
A wide variety of industries are growing in UAE. Company setup in Dubai has several business and development potentials. Before you start a business in Dubai, we recommend that you decide what kind of business you want to run.
Choose a business formation in Dubai that matches your expertise and market demand. It is essential to have a suitable license from the beginning, as various activities require various permits.
Many Dubai and UAE locales restrict commercial activities. Some free zones encourage particular economic activities, such as the Media, financial, or technology sectors.
Over time, certain free zones have begun to accept general corporate operations. You may desire to locate near other companies in your field, even if the same regulations do not bind you. Consider the ownership, liability, and ease of management before choosing while finalizing the structure.
2. Select Jurisdiction
Once you have chosen a business, you must decide whether to set up a business in a free zone or on the Mainland. There are some advantages to locating in a free zone, such as:
- Low corporation tax
- 100% company ownership
- 100% capital and profit repatriation
- No currency limits and 100% import/export tax exemption
- Alternatively, you can trade in the UAE through a mainland corporation that charges
However, you may deal directly with a local and international marketplace if you start up in the Mainland. This ensures that a foreign corporation owner maintains full managerial and financial authority over the organization.
3. Finalize the company name
Pick a specific name for your company that conveys your brand while still meeting the requirements of Dubai naming guidelines. Make sure your company name is legal in UAE due to strict naming rules. Company names referencing political entities like the FBI or Mafia are prohibited. If you want to name your company to a particular individual, that must be the owner or partner of the company.
4. Get approval and complete the incorporation process
Once you have reached this point, you have made the most critical decision about company formation in Dubai. You must complete a company name and activity application and submit it to the government with copies of the shareholder’s passport.
Companies in the Mainland must fulfill a capital criterion in their Memorandum of Association. Before getting your business license in Dubai, you need to get initial approval from the Department of Economic Development (DED). This approval ensures and guarantees that the UAE government has no objection to you to start a business in Dubai. You must get the approval to proceed to the next stage in the application process.
5. Apply for a business license/Register your company
Licenses and Company registration in Dubai can be completed simultaneously. Although, there are other steps involved in the approval and documentation as a whole. Obtaining a necessary permit and license from other government agencies is an essential step of this process, as the Department of Economic Development requires. Furthermore, several forms may need to be filled out depending on the nature of the business.
Your business license will be issued to you by the government after they have reviewed and completed the processing of your application. A completed application form, copies of shareholder passports, and similar items are often required for incorporation in any jurisdiction.
6. Residency/ Applying for a VISA
The next step for business setup in Dubai is to apply for a business VISA. In many Free zones, you can apply VISA for yourself and your dependents.
If you want to sponsor a spouse, child, or maid, get expert advice first to ensure the possibility in the free zone you choose and then ensure you and the person you sponsor meet all VISA requirements.
7. Open a business bank account
Once you have received your completed papers, you will have everything you need to create a business bank account. There are several local and international banks in the United Arab Emirates.
The Commercial Bank of Abu Dhabi and Emirates NBD are a few of the UAE banks, and international banking giants, including HSBC, Citibank, and Barclays, are also represented. To start doing business in the United Arab Emirates (UAE), you will require a business bank account.
The process of opening a bank account in the UAE might take anything from two to four weeks. There are few Inquiries from the bank may include:
- What is your primary business?
- The sum of money you plan to deposit
- Revenue margins
- Who are your primary customers and vendors?
When the government finally returns your documents, you’ll have everything you need to talk to any bank.
Frequently asked questions
1. Can A Foreigner Start a Business in Dubai?
It is possible for a foreigner to start a business in Dubai. There are numerous possibilities to start a business in Dubai, including free zones or the Mainland. Therefore, foreigners are welcome to do so. These alternatives provide varying degrees of ownership and operational independence respectively. The Emirates has several Dubai company formation professionals to support foreigners with licensing, VISA, and business incorporation.
2. How Long Does It Take to Start A New Business In Dubai?
The timeline for starting a business in Dubai depends on several factors, such as the kind of your business setup, business activities, structure, and how quickly you complete the process of business registration in Dubai. Freezone arrangements are generally more efficient than mainland ones regarding processing time. According to many business advisors, business setup in Dubai might take up to a few weeks.
3. Can you own a 100% business in Dubai?
Yes, in most situations, you may control 100% of a business in Dubai. In addition, with the great advantage of a low corporate tax rate, a central location in the world, and ease of incorporation process. It is normally smarter for foreigners to start a business in Dubai freezone where 100% ownership is assured.
4. Can I start a business in Dubai without an office?
Yes, you can start a business in Dubai freezone without having an office. Freezone makes it possible for business owners with a variety of options to grow their businesses. Investors in the UAE have a wide variety of options for getting their business off the ground without having an office.
5. How to set up a company in Dubai?
The first step in opening a company in Dubai involves deciding on the type of business. Pick a distinctive business name, have it approved, and decide your company activities for license. Depending on your business, you may need a local sponsor or service agent. Get your paperwork in order, register a company in Dubai, and, if required, rent some office space.
Investors are always welcome to start a business in Dubai. Establish a business in Dubai is an exciting opportunity that calls for thorough planning and execution. You can confidently start your business journey by acknowledging various types of business structures, the formation procedure, and the required licenses. Dubai’s dynamic economic business environment provides ample opportunities for expansion and success.
You can also seek the help of business setup consultants in Dubai to expedite the process; however, you should be sure to receive sensible advice regarding the repercussions of your decisions and can get support in a business license, a visa, and setting up a corporation.