How to Set Up a Company in Dubai: Everything You Should Know

During the first half of 2025, Dubai Chamber welcomed 35,532 new companies as members, a 4% year-on-year increase, showing that interest in setting up businesses in Dubai remains high. 

The number keeps growing because Dubai has made it easier, faster, and more lucrative than ever for entrepreneurs to build and scale.

But here’s the truth most people don’t hear. Starting a business in Dubai is simple only when you know exactly what you’re doing. When you don’t, it becomes a maze of jurisdictions, approvals, hidden steps, and compliance requirements.

Whether you’re planning new company formation in Dubai, expanding from overseas, or comparing business setup services in Dubai, UAE, understanding the correct process is the difference between launching smoothly and getting stuck with delays, rejections, or costly amendments.

So if you’re wondering how to set up a company in Dubai without confusion, this guide breaks down everything: the rules, the steps, the documents, the choices, and the common mistakes most new entrepreneurs make.

Let’s simplify company formation in Dubai, the right way.

Business Setup In Dubai: The Insider Truth (What Nobody Tells You)

Before you proceed, it’s essential that you get some insights into the insider details to ensure everything stays on track. 

The Bank Account is the Real Hurdle

The license is fast, but securing the corporate bank account can take 4-8 weeks (it often depends). Be prepared for high minimum monthly balance requirements that tie up your working capital.

Mandatory Annual Audits are Common

Many popular Free Zones (DMCC, JAFZA, etc.) require mandatory external audits for license renewal, adding an unforeseen annual compliance cost and significant compliance workload.

Visas are Tied to Office Size

Your ability to hire staff is not limitless; the immigration department rigidly links your visa quota to the size of your Ejari/office space. Scaling your team means a costly, pre-emptive office upgrade.

The Local Service Agent is a Fixed Annual Fee

For Mainland Professional Sole Establishments, the required Local Service Agent (LSA) is not a partner but a mandatory annual retainer cost, which must be budgeted for every renewal cycle.

Investor Visa Rejection is Common

Visa approval is not automatic. Simple issues like uncancelled old residency visas or minor inconsistencies in personal documents (passport vs. attested degree) can trigger an automatic immigration rejection.

Benefits of Setting Up a Company in Dubai

Dubai has something for everyone, and for entrepreneurs, the benefits the city and the country offer are unmatched. Therefore, understand all the advantages that come with registering your business in a city full of opportunities. 

1. Zero Personal Income Tax

Dubai remains one of the few global destinations where individuals pay no tax on personal income. This means entrepreneurs, business owners, and investors keep more of what they earn, making the city an attractive long-term financial base.

2. Full Repatriation of Profits

Businesses in Dubai face no restrictions on sending profits or capital back to their home country. Whether you want to reinvest globally or diversify your assets, your funds remain fully accessible and transferable.

3. 100% Foreign Ownership Across Most Sectors

With the removal of mandatory local sponsorship requirements, investors can now own 100% of their mainland or free zone company. This gives complete control over operations, decision-making, and profits.

4. Low 9% Corporate Tax Rate

Dubai offers one of the lowest corporate tax rates in the world, at just 9% on taxable business profits above AED 375,000. This supports business growth while keeping the UAE competitive on the global investment map.

5. World-Class Infrastructure & Seamless Connectivity

From state-of-the-art airports and seaports to advanced digital infrastructure, Dubai provides everything businesses need to operate at an international level. The city’s logistics ecosystem is unmatched in speed, capacity, and efficiency.

6. A Strategic Global Trade Gateway

Dubai’s geographical position gives companies immediate access to markets across Asia, Europe, and Africa. With world-leading trade policies and global mobility, businesses here can scale cross-border operations with ease.

7. Investor Residency Visa Options

Setting up a business makes you eligible for UAE residency, with pathways for your family, dependents, and staff. Long-term visas offer stability, security, and the ability to build a life in one of the world’s safest and fastest-growing economies.

Legal Structures You Can Choose for Company Registration in Dubai

Dubai offers several legal structures that entrepreneurs can choose from based on their business model, level of ownership, and future plans. Each structure has its own rules, advantages, and ideal use cases. 

1. Sole Establishment (Solo Establishment)

A Sole Establishment is owned by one individual, and the owner has full control over the business. It is commonly used by professionals such as consultants, freelancers, trainers, designers, and service providers.

Example: A marketing consultant who wants to operate independently may register a Sole Establishment and offer services under their own name or a trade name.

2. Limited Liability Company (LLC)

An LLC is the most popular business structure in Dubai. It allows one or more shareholders and provides protection by limiting each shareholder’s liability to the amount they invested in the company. Most commercial and trading activities fall under LLCs.

Example: A group of three investors launching an e-commerce store or trading company can form an LLC, where each person owns a share of the business.

3. Partnerships

A partnership allows two or more individuals to operate a business together. Partners share profits, responsibilities, and liabilities according to their agreement. Partnerships are commonly used for professional or service-based businesses.

Example: Two architects starting a design studio together may form a partnership and divide responsibilities based on their expertise.

4. Joint Stock Companies

A Joint Stock Company is ideal for large businesses that want to raise capital through public or private shareholders. This structure allows the company to issue shares, making it suitable for big enterprises and expansion-focused companies.

Example: A growing manufacturing company planning to expand globally may convert into a Joint Stock Company to attract multiple investors.

5. Branch of a Foreign or Local Company

A Branch is an extension of an existing company, either from the UAE or another country. It is not a separate legal entity, meaning the parent company is fully responsible for its liabilities. A branch must follow UAE laws and can perform activities listed under the parent company.

Example: A UK-based technology firm opening a Dubai office to serve Middle East clients can register a Branch and carry out the same services as the main company.

Different Types of Business Licenses in Dubai, UAE

Every company operating in Dubai or anywhere in the UAE must hold a valid business license to carry out its activities legally. Your license defines what you are permitted to do, where you can operate, and how the government classifies your business.

And while getting a license is the first step, license renewal on time is equally important. An expired license can lead to fines, penalties, or even suspension of your operations, so timely renewal is essential for business continuity. Below are the main types of business licenses available in Dubai:

1. Commercial (Trading) License

A Commercial or Trading License allows companies to import, export, distribute, and store goods within Dubai and the UAE. This is ideal for businesses involved in general trading, e-commerce, retail, or wholesale activities.

2. Industrial License

An Industrial License is required for businesses engaged in manufacturing or industrial activities such as production, packaging, processing, or assembling goods. These companies often require approval from additional authorities depending on the nature of the activity.

3. Professional License

A Professional License is issued to individuals or companies offering services based on professional skills or expertise. This includes consultants, freelancers, designers, IT specialists, marketing agencies, accountants, and more. It allows 100% foreign ownership in many cases.

4. Tourism License

Businesses operating in the travel, hospitality, or tourism sector must obtain a Tourism License. This covers activities like travel agencies, tour operators, inbound/outbound tourism services, and holiday homes management.

Also Read: Difference Between Professional & Commercial License in Dubai (Clear Comparison)

Mainland vs Free Zone vs Offshore: Which Structure Is Right for Your Dubai Business?

Before starting your business setup journey in Dubai, it’s important to determine where your company will be legally registered. Dubai offers three main options: Mainland, Free Zone, and Offshore, each with unique advantages, limitations, and operational rules. The right choice depends entirely on your business model, target market, and long-term goals.

Mainland

A Mainland company is ideal for entrepreneurs who want full access to the UAE market and the flexibility to trade anywhere within the country or internationally. Most business activities now allow 100% foreign ownership, making mainland formation more accessible than ever before.

Mainland companies must lease a physical office space (virtual offices are not accepted), and the location must meet the minimum size criteria set by the authorities. This model works well for businesses requiring on-ground operations, local service delivery, or government contracts. Certain regulated activities may still require local participation or additional approvals.

Free Zone

Free zones are designated economic zones created to support foreign investors and encourage global business activity in Dubai. Companies established in a free zone enjoy full ownership, simplified incorporation, and tax advantages, including 0% personal income tax and 0% corporate tax on qualifying income.

Free zones are best suited for businesses that primarily operate internationally or provide services within the free zone network. However, free zone companies cannot directly trade with the UAE mainland without appointing a local distributor or establishing a branch. Dubai hosts over 30 free zones, many of which cater to specific sectors, such as technology, media, manufacturing, logistics, or commodities, allowing businesses to choose an environment that aligns with their industry.

Offshore

Offshore entities are designed for businesses that want a UAE-registered company without operating within the local UAE market. These companies are commonly used for holding assets, international trade, and investment structuring. Although they can be registered through certain free zones, offshore companies operate under separate regulations.

They do not require physical office space, and there is typically no minimum capital requirement, making them cost-efficient for global operations. Offshore companies cannot conduct business inside the UAE, open premises, or hire staff locally, but they offer confidentiality, asset protection, and ease of international banking.

Best Location for Business Setup in Dubai

Choosing the right location is one of the most important decisions when starting a business in Dubai. Your choice will determine licensing options, operating flexibility, tax benefits, visa allocation, and how your business is perceived in the market.

Broadly, entrepreneurs can choose between:

• Free Zones (100% foreign ownership, tax advantages, industry-specific clusters)
• Mainland (full access to the UAE market, contract flexibility, and on-ground trade capabilities)

Below are 10 of the best locations in Dubai for business setup and why each one stands out.

Top 6 Free Zones in Dubai

(100% Foreign Ownership, Tax Incentives, Business-Friendly Regulations)

1. Jebel Ali Free Zone (JAFZA)

Focus: Logistics, Trading, Manufacturing
JAFZA is one of the world’s most strategic logistics hubs, offering direct connectivity to Jebel Ali Port, the largest man-made port globally. It’s the preferred location for large-scale trading companies, supply chain operations, and industrial firms needing seamless import/export capabilities.

2. Dubai Multi Commodities Centre (DMCC)

Focus: Global Commodities & Service Trade
The largest and fastest-growing free zone in the UAE, DMCC sits in the heart of JLT and is renowned for gold, diamond, tea, and energy trading. It’s also a major destination for professional services, startups, and emerging sectors like blockchain and cryptocurrency.

3. Dubai International Financial Centre (DIFC)

Focus: Banking, Finance, FinTech
DIFC is a world-class financial ecosystem with its own independent common-law framework and regulator (DFSA). It attracts global banks, investment firms, insurance companies, and FinTech startups seeking a sophisticated, internationally aligned regulatory environment.

4. Dubai Airport Free Zone (DAFZA)

Focus: High-Value Trade & Aviation-Linked Businesses
Located beside Dubai International Airport, DAFZA is ideal for companies dealing in electronics, luxury goods, pharma, and other high-value products requiring rapid air freight movement. Its customs efficiencies are unmatched.

5. Dubai Silicon Oasis (DSO)

Focus: Technology, Engineering, R&D
DSO is Dubai’s dedicated technology innovation hub, a smart city featuring modern infrastructure, research facilities, manufacturing units, and tech-friendly regulations. It’s highly attractive for startups, app development firms, hardware manufacturers, and engineering consultancies.

6. Dubai Internet City (DIC)

Focus: Information Technology & Media
As the region’s largest ICT cluster, DIC houses global tech giants and leading digital brands. Businesses benefit from a powerful network effect, sector-specific licensing, and proximity to Dubai Media City and Knowledge Village.

Top 4 Mainland Locations in Dubai

(Full Access to the UAE Market, Flexibility to Trade Anywhere)

7. Business Bay

Focus: Corporate Offices, Consulting, Professional Services
Business Bay is one of Dubai’s most prestigious commercial districts, centrally located and home to modern office towers overlooking the Canal. It’s ideal for businesses that want a strong corporate presence and mainland flexibility.

8. Downtown Dubai

Focus: Retail, Hospitality, Luxury Services
With global landmarks such as the Burj Khalifa and The Dubai Mall, Downtown is perfect for premium brands, restaurants, tourism ventures, and businesses seeking maximum visibility and foot traffic.

9. Jumeirah Lake Towers (JLT)

Focus: SMEs, Professional Services
While DMCC governs the free zone towers, the surrounding mainland areas of JLT offer cost-effective office options in a thriving mixed-use community. It’s a practical choice for small companies, consultancies, and service providers looking to stay central without the high premiums of Downtown.

10. Al Quoz Industrial Area

Focus: Manufacturing, Industrial Operations, Warehousing
Al Quoz is Dubai’s primary industrial district, offering large plots, cost-efficient facilities, and excellent connectivity to major highways. It’s ideal for manufacturing units, logistics companies, fabrication workshops, and heavy operations.

Please Note: While these are some of the most popular and strategic locations for business setup in Dubai, the ideal choice depends entirely on your business activity, target market, budget, and long-term expansion plans. Each jurisdiction has its own rules, benefits, and limitations. If you’re unsure which location aligns best with your goals, consult a professional business setup expert who can guide you toward the most cost-effective and compliant option for your company.

7 Key Steps to Register a Company in Dubai

Setting up a company in Dubai is a structured process, and the government has made it easier by providing clear guidelines for entrepreneurs. Below is a simple, step-by-step breakdown of the major stages involved in registering a new company in Dubai or anywhere in the UAE.

Step 1: Choose Your License Type

Every business must decide whether it requires a Commercial, Professional, Industrial, or Tourism license. Your licence type determines how your business is classified and what activities you are legally allowed to perform.

Step 2: Select Your Business Activity

Choose the exact activity your business will carry out, such as trading, services, consultancy, restaurant operations, logistics, IT, or other approved categories.
Your activity selection impacts:

• Approvals required
• Jurisdiction options
• Visa allocation
• Banking compliance

Step 3: Choose Your Legal Structure

Whether you want to form a Sole Establishment, LLC, Civil Company, Free Zone Entity, or Branch, your legal structure affects ownership, liability, and operational requirements.

Step 4: Register Your Trade Name

Select a unique trade name and submit it for approval. The name must meet UAE naming guidelines and should reflect your business identity. Once approved, the trade name will be reserved under your company file.

Step 5: Choose Your Office Space (Physical or Flexi-Desk)

Depending on your licence and jurisdiction, you must arrange an office location.
Options include:

• Physical office
• Shared desk / Flexi-desk
• Co-working space (allowed in many free zones)

A tenancy contract or Ejari may be required.

Step 6: Obtain Your Trade License

After submitting your documents and receiving initial approval, the authority will issue your official Trade License. This is the main document that legally permits you to operate in Dubai.
Note: Initial approval alone is not enough; the trade license must be issued for your company to be fully registered.

Step 7: Apply for Visas (Investor & Employees)

Once the license is issued, you can open your immigration file and apply for:

• Investor/partner visa
• Employee visas
• Dependent/family visas

This completes the final stage of setting up your business structure in the UAE.

Please Note: These are the key steps, but specific requirements may vary between Mainland, Free Zone, and Offshore setups. Each jurisdiction has its own rules, approvals, and documentation procedures. The best advice is to work with a business setup company in Dubai that can guide you through the correct structure, avoid delays, and ensure full compliance from day one.

Documents Required to Start a Business in Dubai

Setting up a company in Dubai requires certain documents, but not all documents apply to every business. Some are mandatory for everyone, while others depend on your structure, location, or whether you’re already living in the UAE.

1. Business Plan (Required for some setups)

A business plan is not always mandatory, but many Free Zones and almost all banks ask for it, especially if the business is in a regulated sector like finance, investment, education, or healthcare. For simple setups (e.g., basic Mainland services), it may not be required.

2. Passport Copy of Owners/Shareholders (Mandatory)

A clear passport copy is required for every shareholder or partner. If the owner is already a UAE resident, their visa page is also submitted.

3. Tenancy Contract or Lease Agreement (Ejari/Flexi Desk)

This is mandatory for Mainland companies because every Mainland business must have a registered office (Ejari). Most Free Zones also require either:

• A physical office, or
• A Flexi-desk/shared space (accepted for smaller setups)

4. Board Resolution (Only for Corporate Shareholders)

If the shareholder is another company, a Board Resolution is needed to authorise the new Dubai entity. If the shareholder is an individual, this document is not required.

5. Existing Trade License (Only for Branches or Amendments)

You only provide a trade license if:

• You are opening a branch of an existing company, or
• You are modifying an existing license

Otherwise, this is not a document you submit; it is what you receive at the end of the setup process.

6. Local Service Agent (LSA) Agreement (Only for specific structures)

Required only for:

• Professional Sole Establishments
• Civil Companies on the Mainland

LLA/LSA is not needed for LLCs or any Free Zone company.

7. No Objection Certificate (NOC) (Conditional Requirement)

A NOC may be required if the applicant is:

• Employed in the UAE
• Sponsored by their employer
• Starting a business that requires approval

Not required if:

• The person is outside the UAE
• They are on a spouse/parent visa

Always check jurisdiction-specific rules.

8. Memorandum of Association (MOA) & Articles of Association (AOA)

These foundational documents outline:

• Ownership structure
• Roles and responsibilities
• Company activities

In most cases, Dubai authorities provide pre-approved digital templates based on your license and activity. You don’t draft these manually unless you need a customised version.

9. Emirates ID (Only for existing UAE residents)

Required only if the shareholder is already living in the UAE. If the investor is applying from abroad, the Emirates ID is obtained after:

• Trade license issuance
• Residency visa stamping

10. External Approvals (Activity-Based)

Certain business activities require additional approval from relevant authorities before the license is issued. Examples:

• Food businesses → Dubai Municipality
• Healthcare → DHA
• Education → KHDA
• Financial advisory → DFSA or Central Bank

These approvals apply only to regulated sectors.

11. Power of Attorney (POA) (Conditional)

A POA is required if:

• The shareholder cannot be physically present in Dubai
• Someone else (consultant/lawyer) is authorised to sign on their behalf

POAs issued outside the UAE must be attested and legalised.

Please Note: While this list covers the major documents required for setting up a business in Dubai, the exact requirements depend on your business activity, jurisdiction (Mainland, Free Zone, Offshore), and whether you are in or outside the UAE. Working with a professional business setup consultant ensures that you provide the right documents, avoid delays, and complete the process smoothly.

Cost of Setting Up a Business in Dubai

When planning your business setup in Dubai, understanding what contributes to the overall cost is crucial. While the exact amount varies based on different factors, the following primary and secondary factors will help you estimate what to prepare for financially.

Primary Cost Factors

1. Business License Type

The nature of your activity, commercial, professional, industrial, tourism, consultancy, or trading, plays a major role in determining the base cost of forming your company.

2. Jurisdiction Selection

Operating in the Mainland vs. a Free Zone vs. Offshore comes with different fee structures, requirements, and approvals.

3. Business Activities & Approvals

Some activities require special permissions or external approvals from authorities such as Dubai Municipality, KHDA, DHA, or other regulators.

4. Office Space or Flexi-Desk Requirement

Certain jurisdictions require physical office space, while others offer flexi-desk or virtual office solutions. This affects both your setup and renewal costs.

5. Visa Allocation & Immigration Files

Your visa quota, investor visa requirements, employee visas, and establishment card setup all contribute to the initial financial plan.

Secondary Cost Factors

1. Document Attestation & Legalisation

Depending on your nationality and business structure, you may require notarisation, attestation, embassy stamps, or legal translations.

2. Corporate Bank Account Opening

Some banks may require minimum balances, compliance documentation, or additional account setup steps.

3. Consultancy or PRO Services

If you work with professional business setup services, there may be service fees depending on the complexity of your application.

4. Branding, Website & Initial Marketing

Many new businesses underestimate the cost of branding, website creation, advertising, and launch campaigns.

5. Insurance & Compliance Requirements

Depending on your business type, you may need:

• Employee insurance
• Professional indemnity
• Trade-specific compliance coverage

6. Operational and Administrative Costs

Utilities, transportation, stationery, software subscriptions, and onboarding tools can add to your initial expenses.

Please note: There can always be hidden or unexpected costs during the setup phase, such as additional approvals, resubmissions, amendments, or adjustments to your business activity. It’s wise to set aside a buffer fund to ensure your business setup journey stays smooth and stress-free.

Should You Handle Your Business Setup in Dubai On Your Own?

Yes. You can handle your business setup in Dubai on your own, but it’s essential to understand all the challenges and how professional help makes a difference for now and in the long term. 

1. Understanding 60+ Jurisdictions Can Be Complex

Dubai offers Mainland, multiple Free Zones, and numerous Offshore options, each with its own rules, licence structures, activity lists, ownership models, visa quotas, and compliance requirements.
Choosing the wrong jurisdiction or licence activity can impact:

• Your ability to trade
• Your visa eligibility
• Your bank account approval
• Your tax classification
• Your long-term expansion

This is not a game, and guesswork can negatively impact your business. If you pick incorrectly, reversing it means restarting the setup or paying for amendments.

2. Government Processes Require Coordination Across Multiple Departments

A complete business setup may involve approvals from:

• Department of Economy & Tourism (DET)
• Immigration
• MOHRE (Labour)
• Municipality
• Free zone authorities
• Telecom providers
• Banks and compliance teams

Each department has its own timelines, documentation, portals, and procedural steps. Doing it yourself usually means repeated visits, follow-ups, and resubmissions.

3. Documentation Must be Accurate, Consistent, and Compliant

Company formation in Dubai requires:

• Application forms
• Activity selection and classification
• MoA/LPA drafting
• Establishment card
• Immigration files
• Labour quota approvals
• Tenancy/ Ejari (in some cases)
• Bank KYC and onboarding paperwork

Any mismatch or missing detail can delay your licence, your visas, or even your bank account opening, sometimes for weeks.

4. You Might Save on Service Fees, but Spend Far More on Delays

Doing it yourself seems cheaper, but the hidden costs are real:

• Re-typing documents
• Paying penalties for mistakes or expired approvals
• Lost business time
• Delayed launch
• Compliance missteps
• Additional fees for amendments

Your time is your biggest investment. If you’re running a business, every hour spent navigating approvals and paperwork is an hour not spent on sales, planning, or execution.

That’s where business setup consultants in Dubai make things easier and stress-free for you. Working with them means outsourcing all your tasks to professionals, while you focus on creating strategies for your business’s growth. 

7 Areas Where You Can Go Wrong While Setting Up a Company in Dubai, UAE

While it’s essential to understand how to do things the right way, it’s equally important to know where things can go wrong, so you’re prepared well in advance. 

1. Choosing the Wrong Jurisdiction (Mainland, Free Zone, Offshore)

Dubai has over 60+ jurisdictions, each with different rules, activities, visa limits, banking requirements, and tax implications. Selecting the wrong one can block your ability to trade, cause banking rejection, or force expensive amendments later.

2. Selecting Incorrect Business Activities

Every licence in Dubai must list activities approved by the authorities. Choosing the wrong activity, or missing one, affects:

• What services/products are you legally allowed to offer
• Bank account approvals
• Future compliance

Incorrect activity selection is one of the biggest reasons entrepreneurs face delays.

3. Misunderstanding Ownership Rules & Legal Structures

Dubai offers Mainland Companies, Free Zone Entities, Civil Companies, Sole Establishments, Holding Companies, etc. Each has different implications for:

• Ownership
• Liability
• Taxation
• Expansion

Choosing the wrong structure can limit your growth or force restructuring.

4. Underestimating Documentation & Compliance Requirements

From MoA drafting to KYC, immigration files, establishment cards, tenancy/Ejari (in many cases), and banking documents, even a small mismatch can stall your setup. 

Inaccurate paperwork leads to repeated submissions, resulting in unnecessary delays.

5. Not Considering Visa & Staffing Requirements Early

Your licence, office size, and jurisdiction decide your visa quota. Many entrepreneurs choose a setup that doesn’t match their hiring plan, forcing costly upgrades or relocations later.

6. Overlooking Banking Challenges

Bank compliance in the UAE is strict. Choosing a licence or activity considered “high-risk,” not maintaining proper documentation, or failing to justify your business model can result in:

• Delayed approvals
• Account rejection
• Freezing of operations

Knowing bank requirements before choosing a licence is crucial.

7. Trying to Save Money by Doing Everything Yourself

Yes, you can set up a company on your own, but the hidden costs often outweigh the savings. Common issues include:

• Missing approvals
• Selecting incorrect activities
• Non-compliant documentation
• Banking delays
• Rejections from government portals

One mistake can cost more time and money than hiring an expert in the first place.

How Vista Business Setup Can Help

We offer end-to-end business setup services, including license, visa, office space, opening a bank account, PRO, and business registration in the UAE. Our goal in your journey of how to set up a company in Dubai is to make it customised, hassle-free, and budget-friendly. When your business idea is strong, your setup process should be simple and budget-friendly. With our low-cost business services setup in Dubai, UAE, you get clear steps, transparent guidance, and a team that believes in doing things the right way.

Confused about where to start? Talk with our expert. Your first 30-minute consultation is absolutely free. 

Book a Free Consultation

FAQs

How fast can I start a business in Dubai?
The time required to establish a company in Dubai is highly dependent on your chosen jurisdiction and business activity. For simple activities in most Free Zones, the Trade License can be issued very quickly, often within 3 to 7 working days. Mainland setups with the Department of Economy and Tourism (DET) generally take slightly longer, typically 7 to 14 working days. However, this is just the license. The entire process, including securing necessary external regulatory approvals, successfully opening a corporate bank account (often 2–6 weeks), and finalising investor visas, means a business is usually fully operational within 4 to 8 weeks.

Is it possible to set up a company in Dubai without money?

No, it is not possible to set up a company in Dubai with absolutely AED 0 (zero money). However, yes, it is possible to set up a legal, licensed business with minimal upfront capital by focusing on service-based models and making the most of the cheapest setup options available.

Do I need a local sponsor to start a company in Dubai?

The requirement for a local sponsor has largely been eliminated in Dubai. For most commercial and industrial activities on the Mainland, you can now establish a Limited Liability Company (LLC) with 100% foreign ownership, thanks to the 2021 legislative amendments. 

Similarly, Free Zone companies have always allowed 100% foreign ownership. For Mainland Professional Licenses (e.g., consultants), you must appoint a Local Service Agent (LSA), who is a UAE National, but the LSA holds no ownership or equity in your business, allowing you to retain full control.

Do new businesses in Dubai have to register for VAT immediately?
Not always. VAT registration becomes mandatory only when your taxable supplies or expected revenues exceed the AED 375,000 annual threshold. If your turnover is below this but above AED 187,500, you may choose voluntary registration, which can still benefit your business. Every company should monitor its revenue closely to ensure timely compliance with the Federal Tax Authority.

How to Open a Company in Dubai?
Opening a company in Dubai is a streamlined process that can be summarised in six key stages:

• Define Your Structure: Determine the ideal jurisdiction (Mainland for full UAE access or Free Zone for 100% foreign ownership) and choose your specific business activity and legal structure (e.g., LLC, Sole Establishment).
• Name & Initial Approval: Reserve your trade name and obtain the initial approval certificate from the Department of Economy and Tourism (DET) or the chosen Free Zone authority.
• Secure Space: Arrange a legal address by securing a tenancy contract (Ejari for Mainland) or a Flexi-Desk/office lease in the Free Zone.
• Final Submission: Submit all necessary documentation, including MOA/AOA, shareholder passports, and the lease agreement, to receive the official Trade License.
• Bank Account: Use the new Trade License to successfully open a corporate bank account (this is often the longest step).
• Residency: Apply for your establishment card and process investor and employee residency visas and Emirates IDs.

Is there any minimum capital requirement to start a business in Dubai?
There is generally no mandatory minimum capital requirement to start a business in Dubai for the most common activities. Following recent legal reforms, Mainland LLCs are typically not required to deposit a specific capital amount for license issuance. Similarly, most Free Zone companies allow a nominal capital (e.g., AED 1,000).
However, you must be aware of two exceptions: Highly regulated activities (like finance and insurance) still enforce significant capital requirements. While the legal minimum is often low, you must still budget for the actual setup expenses, including annual license fees, office space, and visa costs, which represent your true investment.

Can I open a company in Dubai without being present there?

Yes, it is entirely possible to open a company in Dubai remotely for the initial setup phase. The UAE government and many Free Zone authorities have digitised the process, allowing shareholders to submit all required documents, utilise e-signatures, and obtain the Trade License electronically from abroad. 

For Mainland setups, this is typically facilitated through a local consultant using an internationally attested Power of Attorney (POA). However, while the company formation is remote, the corporate bank account setup and the mandatory residency visa processing (medical test and biometrics) often still require the shareholder to make a brief physical visit to the UAE.

How are UAE company branches treated under corporate tax rules?

Under UAE Corporate Tax regulations, a branch of a UAE company is not considered a separate taxpayer; it’s treated as part of the same legal entity for tax purposes. However, if that branch operates inside a free zone, it is regarded as part of the “free zone entity,” which may impact eligibility for free zone tax incentives and qualifying income conditions.

Disclaimer: This blog provides general information on business setup in Dubai and should not be considered legal, financial, or tax advice. Regulations, processes, and requirements may change based on jurisdiction and business activity. Readers should verify details with relevant authorities or consult a professional advisor. TheVistaCorp is not responsible for actions taken based on this content.