SETUP A COMPANY IN DUBAI
As we know, starting a business is like setting off on a wild adventure and it is a dream of any hardworking person. Maybe you have stumbled upon starting it in a foreign country like the United Arab Emirates (UAE) to see whether it can be more rewarding compared to starting it in your home country. It is widely known that the United Arab Emirates (UAE) is one of the most financially attractive locations worldwide, with a well-developed and diversified economy with excellent infrastructure, great transport links and a unique low tax regime.
In UAE, Dubai can be the best place to set up your business, according to the latest annual Global Entrepreneurship Monitor (GEM) survey. Among the key advantages of doing business in the Emirate are a favorable tax policy, a well-developed banking system, stable economic and political situations in the country and a convenient international payment system. The government supports entrepreneurs and offers various state programs and incentives to them.
To set up a business in Dubai, you can consider these steps:
- Identify your business activity to determine the type of license you need.
- Choose a legal structure to reduce legal and operational risk, tax obligations, etc.
- Register a trade name depending on your business activity.
- Apply for initial approval.
- Create a logistic supply agreement (LSA) or memorandum of association (MOA).
- Choose a location for your business.
- Apply for additional government approvals.
Set up your business either in the free zone or in the mainland with the best business setup consultants in Dubai. A mainland business simply means it is an onshore entity registered with the relevant emirate’s government body. The Emirate’s Department of Economic Development (DED) issues its trade license.
The main advantage is there are no restrictions on its commercial activities. According to new regulations, foreigners can have 100% ownership of their company in a freezone in most activities and mainland companies need to have a local owner with 51% share in their company. Because of this freedom, the setting up of a mainland company is a bit more complicated.
A free zone company is simply an enterprise registered with one of the designated economic zones in the UAE. The cost of setting up business in the free zone is comparatively lower than on the mainland.
As of today, mainland companies are required by law to file and pay a 9% Corporate Tax on profits exceeding AED 375,000 every year. However, this tax is only applicable if the business has an annual turnover of over AED 1 million. On the other hand, free zone companies are not liable to pay corporate tax at the moment.
Along with this, to know how much it costs to start setting up a business is another important factor. The cost of starting a business in Dubai can vary depending on the type of business, location, scale of business and its activity. Some business activities may require additional approvals and document clearance from relevant authorities.
In Dubai, the cost of registration to set up a limited liability corporation can be between AED 22000 and AED 24000. On the other hand, the business registration cost in the free zones starts at approximately AED 15000 and in the mainland starts formation cost between AED 15000 and AED 35000.
Hence, to ensure a seamless business setup in Dubai, knowing the above steps is imperative. Dubai doesn’t offer too much resistance in the name of legal formalities for business establishment. However, there are some conditions that an applicant must abide by for a hassle-free incorporation journey. Now that you’ve gotten an idea about setting up a business in Dubai, connect with us today to get more information. We, Quick Express, are here to assist you achieve your dream of establishing your dream business in Dubai!
