An increasing number of non-resident business tycoons have established their businesses in Dubai thanks to the city's prime business environment and the 0% tax on corporate and personal income that further attracts foreigners to stay and open their companies. Other factors that have solidified the city's reputation in the eyes of foreign nationals include world-class infrastructure, the introduction of long-term visas, its strategic global location, and an ever-growing economy.

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business setup as a foreigner

Company Setup Services in Dubai for foreigners

Foreigners looking to set up a company in Dubai have several options available to them. These options are largely divided into two categories: Mainland companies and Free Zone companies. Here’s a closer look at each:

Mainland Company

Setting up a mainland company allows you to do business anywhere in the UAE, including free zones. You can choose from several legal forms such as Limited Liability Company (LLC), Professional License (sole proprietorship), and Civil Company.
However, for most types of mainland companies, there is a requirement for a local sponsor or a local service agent. The local sponsor, who must be a UAE national, owns 51% of the shares in the company, while the foreign investor owns 49%. In the case of a Professional License, the local service agent doesn’t have any shares but is needed for liaising with government departments.

Offshore Company

UAE also allows the setup of offshore companies, which are often used for international business and investment. These companies enjoy tax benefits and confidentiality, but they cannot carry out business within the UAE.
Choosing the right setup option depends on your business activities, where you plan to do business, and your ownership preferences. It’s always advisable to consult with a business setup advisor to understand which option is best for your specific needs.

Free Zone Company

UAE has more than 40 free zones, each catering to specific business sectors such as technology, healthcare, media, design, commodities, etc. When you set up a company in a free zone, you can enjoy 100% foreign ownership, 100% repatriation of capital and profits, and exemption from import and export taxes.
Free zones also offer a streamlined setup process, and companies within them are not required to have a local sponsor. However, free zone companies are generally allowed to do business only within their own free zone or outside the UAE, unless they have a local distributor or open a branch outside the free zone.

Frequently Asked Questions

1Can foreigners own 100% of a business in Dubai/UAE?
Mainland Business: No, in mainland businesses, a local sponsor or partner (UAE national) is typically required and holds at least 51% ownership. However, specific structures can be established to safeguard foreign interests. Free Zone Business: Yes, in most free zones, foreigners can own 100% of the business, offering greater ownership flexibility and certain tax benefits.
2What are the key business activities allowed for foreigners in Dubai/UAE?
The permitted business activities vary based on the chosen legal structure and location. It's important to check with relevant authorities or business setup consultants for specific guidelines.
3Is a physical office space required for business setup?
Requirements vary; some free zones may mandate having physical office space, while others offer flexi-desk or virtual office options. Mainland businesses usually require a physical office.
4What documents are needed for business setup?
Documents may include passport copies, visa copies, business plan, Memorandum of Association (MOA), lease agreement, and other specific documentation based on your business type and location.
5How long does the business setup process take?
Timelines depend on the chosen legal structure and location. Free zone setups tend to be quicker, typically taking a few weeks, while mainland setups may take longer due to additional approvals.
6Are there restrictions on hiring foreign employees?
The UAE has specific visa regulations for foreign employees. The number of visas you can obtain depends on the size of your office space and the business activity. Business setup consultants can assist in the visa application process.
7What ongoing compliance requirements should I be aware of?
Ongoing compliance involves renewing licenses, submitting annual reports, and complying with tax regulations. Business setup consultants can provide guidance on meeting these requirements.