Business Formation in Dubai: In 4 simple steps

business formation in Dubai, UAE

Dubai is known around the world for many reasons – its majestic skyline, stunning beaches, unreal constructions, and, of course, its business environment.

But while the emirate may seem otherworldly, even daunting to some, finding your place in this amazing environment is easier than you might think.

When handled by a professional, starting a business and obtaining a visa in the UAE takes just four simple steps. When you work with a company setup agent, the entire process of business formation in Dubai is both fast and straightforward.

Benefits of forming a business in Dubai

There are many incredible benefits to business formation in Dubai. For one, its strategic location puts it at the heart of the business world. It shares a time zone with many other major hubs and is within minimal flying time of much of the world’s population.

Then there is the emirate’s world-renowned tax rate, which still stands at 0% on both corporate and personal income. Dubai is also home to numerous free zones which offer businesses 100% customs tax exemption, zero currency restrictions, and capital and profit repatriation.

Finally, Dubai is also home to an incredibly welcoming corporate environment with an incorporation process and business regulation designed to help startups and SMEs succeed.

Business Formation in Dubai: In 4 simple steps

Before you start the company formation process, it’s a good idea to get to know the two most common types of business in the Dubai. These are free zone and mainland.

Mainland companies can be set up anywhere in the UAE, can trade directly with the local market and are not tied to any local authority. Free zone businesses can only trade from their chosen zone and must use a local service agent to trade with the local market.

As mentioned above, free zone businesses also benefit from a range of allowances and tax exemptions. For this reason, setting up in a free zone is often the most cost-effective way to do business in the UAE.

After a little research, you’re ready to begin the process of business formation in Dubai.

Step one: Partner with a company setup agent

The first, and potentially most important, step in Dubai company formation is selecting the right company setup partner.

A company setup agent can manage the entire process for you, guiding you through every step on this list. However, some agents are better suited to certain industries, company sizes, and setup types, so the one that’s right for you will depend on your specific needs.

Company Setup UAE (CSU) can help to find your perfect setup partner. Simply let us know a few details about your business and we’ll find the best fit for your needs in terms of company setup package and visa requirements, at the best price possible.

Step two: Activities and company name

Before making your license application, there are a couple of administrative tasks to take care of. First, you must outline your business activities. This will dictate the type of license that you need to apply for.

You are only permitted to carry out the activities listed on your business license. However, there are many activities to choose from, and it is often possible to carry out multiple activities under a single license.

Next, you can choose a company name. While this is often something that many entrepreneurs take for granted, it’s a very important step in the company formation process here in Dubai.

As well as choosing a name that is memorable and conveys the essence of your brand, you must also adhere to strict naming conventions. These are rather easy to abide by, however. In short, you should not include any offensive or blasphemous words in your business name, nor should it include the name of any well-known organisations such as the CIA or NASA.

There are a few more minor considerations too, but a company formation specialist can help you navigate these to ensure your chosen name meets the criteria.

Step three: License application

Now you are ready to make your license application. If you are setting up on the mainland, your license application will be handled by the DED. If you choose a free zone setup, then your company setup agent will liaise directly with your selected free zone.

In both cases, at the very least, you will need to provide the following:

  • Completed application form
  • Copies of the passports of any owners/shareholders
  • Two colour passport size photos

In any event, your setup partner can manage this step for you, liaising with all relevant government departments on your behalf.

Step four: Visa application

At this stage, you will also need to apply for a visa to live and work in the UAE. This application can be made separately with immigration or handled as part of your free zone license application.

Once again, your setup agent can handle this entire process to ensure it runs as smoothly as possible.

As the holder of a UAE trade license and residency visa, you can also sponsor your dependants for their UAE residency visas too. Whether you are looking to support a spouse, child, parent or domestic staff member for their application, the process is easy.

Cost of forming a business in Dubai

There are many factors at play when calculating the total cost of business formation in Dubai. The location and type of setup, the size of your premises, your business activities, and number of employees will all have a bearing on the total price you’ll pay.

For a new business setting up here, it is reasonable to expect to pay between AED 10,000 and AED 15,000 for a Dubai business license.

This will be less if you set up as a freelancer, or if you opt for a flexi-desk package which includes the use of business facilities such as desk space, meeting rooms and call answering on an ad-hoc basis.

On the other hand, if you require large premises such as a showroom or warehouse, then you can expect these costs to increase.

We’ll find your perfect company setup partner

CSU can help to find your perfect company setup partner.

We work with company setup providers and free zones around the country, staying up on the latest offerings to pass on to you.

Simply give us a few details about you and your business and we’ll do the rest – searching our portfolio of partners to find the package that’s right for you.

Contact CSU today for expert guidance on business setup in Dubai.