Introduction
The United Arab Emirates in the middle east is known for its Oil & Tourist locations. It is also a well- known fact amongst businesses to be one of the most attractive countries in terms of establishing a business because of its benefits. Whether we talk about hassle free & fast process, futuristic infrastructure, latest technologies, e-visa, low licensing fees, currency, tax benefits, investor friendly economy and what not. Businesses around the world are opening their branches in UAE and some of the FORTUNE 500 companies are shifting their regional headquarters to the emirates. Let us dive into everything you need to know about establishing your business in UAE.
Process of Incorporation of Company
All the businesses should follow these simple steps to establish a company in all the seven emirates whether it be Dubai or Abu Dhabi and apply to the Department of Economic Development. According to the Ministry of Economy website it takes less than 4 days to set-up a company in UAE, and it takes just 15 minutes with BASHER online platform. Basher just requires you to have a valid UAE resident ID, UAE PASS account, Trade name, Investor details, Company information and gives grace period for submitting documents after obtaining the license. First, determine if you want your company’s location to be in the mainland or Free Zone.
Process to setup your company in Economic Freezone, UAE –
- Determine the nature of business activity for commercial license..
- Determine company’s legal structure such as LLC, Company, Free Zone Establishment etc.
- Determine the Trade name according to terms & conditions.
- Business Space – Land, separate office, common office, or virtual office.
- Obtain approval by submitting documents.
- Register and pay the fees.
Documents commonly required for companies to be set-up in Free Zones
- Completed application form.
- Business plan.
- Copy of existing trade license/registration certificate (if applicable).
- Passport copies of the company’s shareholders and appointed manager.
- Registry Identification Code Form (RIC) for appointed manager (original and notarized).
- Specimen signatures of the company’s shareholders and appointed manager.
- Title deeds (if applicable).
- A brief letter clarifying the investment idea and the investor’s plan (Letter of Intent).
- 2 years audited financial reports or certificate of reference from a bank (as required).
Documents commonly required for freelancers/professionals
- Application for registration.
- Curriculum vitae or profile.
- Reference letter from a bank.
- Registry Identification Form (RIC) for Director (original and notarized document).
Other Documents which may be required –
- Completed application form for registration.
- Board Resolution appointing Manager/Director (notarized and attested).
- Power of Attorney given to Manager/Director (notarized and attested).
- Memorandum and Articles of Association (notarized and attested).
- Specimen signature of Manager/Director (notarized and attested).
- Passport-size photos of Manager/Director.
- Share capital information.
Process to setup your company in Mainland, UAE –
- Determine the Nature of Your Business Activity. There are 6 main types of economic licenses provided for mainland.
- Determine company’s legal structure such as Sole establishment, Branch of a GCC company, Civil company, Branch of a local company, Limited liability company, Holding company, Public joint stock company, Representative office of a foreign company, and Private joint stock company.
- Register the trade name according to the terms & conditions.
- Get an initial approval from the UAE Government called ‘no objection’ certificate for business activity.
- Create a Local service agent agreement in case of sole proprietorship, otherwise Memorandum of Association.
- Choose a physical business location with T&C.
- Apply for additional government approvals from the relevant department according to the nature of business.
- Submit the documents.
- Pay fees and collect license physically or through website.
- Register the company with the relevant chamber of commerce and industry.
List of documents required –
- Receipt of initial approval and copies of all previously submitted documents.
- Copy of lease contract, duly attested.
- Memorandum/s of Association, as required.
- Approvals from other government entities, as required.
CORPORATE TAX FOR BUSINESSES AND PROFESSIONALS
UAE has introduced corporate tax for businesses set-up under the mainland and the businesses need to register themselves with the Federal Tax Authority and comply with the rules & regulations. The businesses and professionals in the mainland will be subject to 9% Tax on profits above 375,000 AED and zero corporate tax below it. Although businesses and professionals under the free zones are subject to zero corporate tax without any limit but the companies in the mainland must pay taxes subject to the above condition. Nonpayment of taxes may lead to jail up to 6 months and fine up to 100,000 AED. So, if you are setting up a new company, do choose the location wisely.
BENEFITS OF SETTING UP COMPANY IN UAE
There is more to it from what is mentioned below:
- Hassle Free & Fast Process – If you are still confused and cannot find an effortless way to set up your business, do not worry you have Dar Al Haqooq at your service, we will tailor the solutions according to your needs and fulfill all the requirements at the minimum cost and set-up your business within 3 days.
- Futuristic Infrastructure – Yes you guessed it right, we are talking about the country of Burj Khalifa & Future Museum. This country is always a step ahead when it comes to infrastructure.
- Technology – Look no further than Expo 2020 Dubai for a glimpse into the UAE’s tech. Stay ahead with the latest technologies to drive your business forward.
- E-Visas – You do not need to visit office from office for visas. You can apply for your own and your employee’s visas. You can stay anywhere in the world and apply for it.
- Golden Visa – Anyone can get a golden visa by fulfilling the requirements and stay tension free for 10 years once you acquire a Golden Visa. You can also sponsor visas for your family and other people by yourself.
- Cost of setting up – If you compare the cost of setting up businesses with the top world countries, the UAE stands out to be one of the cheapest, easiest, and amongst the most beneficial countries to set up your business.
- Access to Global Markets – If you want to trade goods, you are almost in the middle of the world and near the port. Start shipping, instantly.
- Business Growth & Expansion – Freezones not only provide you with good infrastructure, but they also create a supportive ecosystem for scalability of your business.
- Flexibility – Not sure about having which type of office? You can opt for a common office or virtual office depending on your need and business plans.
- Blockchain & Crypto Hub – Take advantage of UAE for being a crypto friendly country and start your own Blockchain based company.
- Tax – Freezones offer zero tax for your business with no strings attached.
- Currency – The currency neither devaluates nor floats in the market against the USD. It is fixed to 3.67 AED per 1 USD.
- Ease of Doing Business – According to the World Bank, UAE is ranked highest in Ease of doing business in the MENA region and 16th in the world.
CONCLUSION
The economy of the UAE is primarily driven by oil and tourism. The government here aims to reduce its reliance on oil and explore other avenues to diversify and boost its economy. Hence, it offers significant incentives to businesses opening here to help bridge the gap and stimulate economic growth. Incorporating your business in the UAE unveils a world of opportunities. Whether you are an entrepreneur seeking rapid growth or an established corporation eyeing global expansion, the UAE is like a magnet with offers of an unmatched environment for success. Its tax advantages, access to global markets, ease of doing business, and industry-specific benefits make it a destination of choice.