Dubai offers a strong base for international business, with open trade, modern infrastructure and a wide choice of structures. This guide covers the decisions and steps.
Why Dubai
- Straightforward company formation
- A large expatriate workforce
- A competitive corporate tax regime
- Dozens of free zones
- Good infrastructure, a strategic location and an efficient visa system
- Strong government support for business
Choose the zone first
Free zone. Typically 100% foreign ownership, full repatriation of capital and profits, and customs benefits. A qualifying free zone company can enjoy 0% corporate tax on qualifying income, subject to conditions.
Mainland. Lets you trade across the UAE and with the local market. Historically foreign ownership was limited to 49% with a local partner, but reforms now allow 100% foreign ownership for most activities. Confirm the rule for your activity. You need a registered office address and government approvals.
Offshore. Used for holding assets or international structures. It cannot trade in the local market. Review the tax and reporting position with an adviser, because being offshore does not remove all obligations.
Licence types
- Commercial: trading, import, export.
- Industrial: manufacturing and processing.
- Professional: service providers and artisans.
- Tourism: travel and tourism businesses.
Seven steps for a free zone company
1. Choose your activity and licence type. Hundreds of activities are listed on the licensing authority website. 2. Choose a free zone that fits your industry. 3. Pick a trade name and office. Names must not be offensive, defamatory or political, and a name based on a person must use the full name. 4. Apply for initial approval. Typical documents are the application form, passport and visa copies, incorporation documents and sometimes a feasibility study. 5. Open a corporate bank account with a UAE bank. Banks run due diligence, so be ready to explain your business. 6. Secure your office. A physical address is required, and free zones offer simple options. 7. Final approval. Submit the lease, required approvals from other authorities and pay the licence fee. Your licence is issued.
After setup
Register for corporate tax and, if applicable, VAT, keep proper accounting records and plan your audit and annual filings. See our business setup services, corporate tax registration and the list of free zones.
Key takeaways
- Pick the zone first: free zone, mainland or offshore.
- Most mainland activities now allow 100% foreign ownership, but confirm for your activity.
- Register for corporate tax and VAT after the licence is issued.
Frequently asked questions
Which is better, free zone or mainland?
It depends on where your customers are. Free zones suit international work; mainland suits local trade.
Do I need a physical office?
Yes. A physical address is required, and free zones offer flexible options.
Talk to a chartered accountant
Questions about your own situation? Reach us directly and we will reply with clear next steps.
This article is general information and not advice for your specific circumstances. Rules and thresholds change, so confirm the current position before you act.
