Dubai is one of the best places in the world to start a business. The relatively straightforward process and fiscal advantages that allow you to pay little-to-no tax, attracts thousands of businesses to the city every year. In fact, it is now estimated that over 50,000 businesses were set up in Dubai last year alone. But before you look into opening your own business in Dubai, there are a number of things you should know, like: what documents you need, how much it costs, how long the incorporation process takes, and most importantly, what are the actual benefits of opening your business in Dubai?
In this blog, we will answer all these questions to help you make the best possible decision for your business. If you would like additional help with setting up your Business in Dubai, you can contact us and one of our advisors will be happy to help.
6a. Establish where you want to incorporate
6b. Define what type of business license you need
6c. Submit your application and get your license
6d. Apply for your Visa and Emirates ID
Ok, so thousands of people choose to open a business in Dubai every month, but why? There’s many benefits of bringing your existing company (or creating one from scratch) in this popular city in the UAE. Some of them include:
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There are a number of costs you need to take into account when starting a business in the UAE. People think it’s just about paying a one-off fee for incorporation, but that’s not correct. There are initial fees to obtain a Business License, additional fees in case you want to sponsor people (i.e. issue a Visa for yourself and your employees), and then yearly fees to renew your license as well. Depending on where in Dubai you incorporate your Business, the costs will be different, but here is a snapshot:
As you can see, the costs can range quite dramatically depending on where you decide to incorporate. This is because different FreeZones will offer you different types of benefits, such as Desk Space, Tax support, or others. There are additional costs, however, that people should consider when when starting a Business in Dubai:
Dubai is notably the most popular option for Expats looking to move their company out here to the UAE, but that comes with a higher price tag than other Emirates. If you just want to open a business with the key structure for fiscal reasons and don’t plan on spending much time in the city, there are cheaper incorporation alternatives such as Sharjah and Ras Al Khaimah. In these neighbouring Emirates, you can incorporate your Business for as little as AED 6,000, but do note that you may have to travel there from time to time to update documents or take care of paperwork. There are also some incremental costs that will naturally come into play such issuing Visas or getting office spaces.
Knowing and understanding exactly your business type and plans can help you ensure you make the right long-term decision when it comes to opening a business in the UAE. Countless people often go for the most affordable option at the start and end up regretting it over the long term, so make sure to speak to us if you have any questions about starting a Business in Dubai.
Opening a Business takes on average 2 to 4 weeks, if you have all your documents ready. Initially you will have to submit your documentation, get it approved, submit further information about your company, pay the initial fees, and then wait for the License to be issued once you have been approved. Between each of these steps there’s a wait of 2-4 working days. However, most Freezones offer an option to expedite your application for an extra cost, which can sometimes reduce the overall time to under 2 weeks.
After the company is incorporated (which can mostly be done remotely), you will be able to proceed to the Visa issuing stage, which can take another 2 to 4 weeks, and for this you will have to come into the UAE.
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In order to kickstart the process of Opening a Business in Dubai, you will have to submit a number of Documents. These will slightly vary depending on 1) if it’s a new company or a subsidiary of a company in another country, and 2) the Freezone you select to incorporate in. Irrespectively, as a ballpark you can use the following list as a starting point for the documentation you’ll be asked:
In addition, you will be requested to provide a Business name (and 2 additional alternatives), confirm Shareholder details, assign an HR signatory, among other things. Eventually, you will also be asked to proceed with the payment of the Freezone Fees, and any other Service Fees as well.
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How do you actually do it? Well, incorporating your Business in Dubai is a straight-forward process, but there are several steps you need to go through, and think about, ahead of starting the process.
From defining the Zone under which you will set up your business, to the legal structure under which you will operate - making the right decisions up front can end up saving you a lot of time and money down the line. Let’s go through the most important things you need to do in order to open your business in Dubai.
There are two main options when it comes to business incorporation in Dubai: Free Zone or Mainland. Most people end up choosing to incorporate in a Free Zone as you can retain 100% ownership of the business, while availing appealing Tax benefits (such as 0% Income Tax). When deciding whether to incorporate in a free zone or on the mainland in Dubai, it's essential to consider factors such as ownership requirements, business activities, tax implications, and location preferences.
There are many Free Zones in Dubai, some tailored to specific business activities under which you should operate. For example, DIFC (Dubai International Financial Centre) is the place where most Fintech companies and Banking Entities are set up due to its legal structure, whereas DSP (Dubai Science Park) is dedicated to the Science and Healthcare sectors which accommodate Pharmaceutical companies, biotech, R&D and so on.
Each Free Zone has its own cost to incorporate and maintain over the years. It’s important to carefully consider costs when making a decision of where in Dubai to open a Business. Don’t worry, this is something our team can help you with! You can speak to us to get help with finding the right FreeZone for you.
In Dubai, the type of business you plan to operate impacts the type of license you need to obtain. The Dubai Department of Economic Development (DED) categorizes business licenses into several types based on the nature of the business activity. Some common business license types in Dubai include: Commercial License, Food License, Tourism License, Industrial License, etc.
The specific requirements for obtaining each type of license can vary, including documentation, fees, and other regulatory requirements. Additionally, there might be further subcategories or specific requirements depending on the nature of your business within these broader license types. Before starting your business in Dubai, it's crucial to research and understand the regulations and licensing requirements that apply to your specific business type. Reach out to us for a consultation on how to open a business in the UAE.
Once you’ve chosen the Free Zone under which you want to incorporate, you will need to put together the application. This involves collecting Documents such as your passport, filling out the required information via the portal (depending on the Zone) and paying the fees associated with Acquiring the Business License.
As part of opening a new business, you will have a business license, an establishment card and a lease of an office, which can be private or in a co-working area. If you want to issue yourself and others a Visa, you will also need to get a Personal Sponsorship Agreement, which typically comes at a cost, and is done at this stage.
The overall process doesn’t take too long and can be done in 2-4 weeks end-to-end, depending on the Free Zone and on the volumes being processed. You can also expedite your application and get it done in less than half of the time, if you have an urgency. Note that this also comes at an extra cost.
When the business is incorporated in Dubai, you can start the process of requesting Employee Visas. The number of Visas you can get depends on the package you purchase, but it normally is between 2 and 4 initially. You can always purchase more “slots” at an extra cost, or get a larger package.
Before you onboard new employees, you should sign with them an employment contract which clearly states their dates of employment, salary and responsibilities. Depending on their role and seniority, they will most likely need to provide you with an attested educational degree, which you have to submit alongside the rest of their application. Lastly, you will need a copy of their passport and passport-type photo.
After you submit the initial application and make the payment, your new employees (which may include yourself) will get an e-Visa, which can be used to enter the country. Upon arrival, the beneficiaries of the Visa will undergo a medical test in a designated medical center. This includes a blood test and an X-Ray. The results are submitted to the relevant authorities as part of the visa processing. The last step is to have their biometrics recorded (picture and fingerprints) and finally request an Emirates ID. The Emirates ID will be their/your local ID which can be used to open a bank account, rent an apartment, and so on.
Get help with opening your Business and UAE Visa from our Specialists. Reach out to us today.
While opening a Business may seem like the best option for everyone, in some cases it’s worth considering getting a Freelancer Visa instead. You can still invoice clients, get paid, and avail from all the other benefits, except sponsoring other employees. Of course, the Freelancer option is a more simplistic way to operate as there are less requirements from a paperwork perspective, but it’s also cheaper. Before you assume you’ll 100% need a Company in dubai, reach out to speak to us, because maybe you’ll only need a Freelancer Visa.
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