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Business Formation in UAE

Starting a business in the UAE is not a tough task. Forming a company in Dubai involves many benefits. Many people might need clarification on the steps involved. Many steps, documents, and legal licenses are required to form a company.  

Whether you want to choose a company name or try to decide which zone to choose from, which name will suit your business well? Don’t worry; Shuraa will cover the required steps for this blog. Documents are needed to get the approvals and everything related to business formation in the UAE. Continue to read further anytime.  

Why Choose Business Formation in the UAE? 

Business Formation in the UAE has several reasons entrepreneurs can form a company. The location is one of the main reasons for starting a business in Dubai. You don’t have to pay a heavy tax.  

The low tax also helps firms increase their profits. The government supports entrepreneurship through incentives and initiatives and creates a favourable ecosystem for business growth. Most people are attracted to Dubai because of its infrastructure, and it also welcomes tourists.  

What are the advantages of Business formation in the UAE? 

Business formation in the UAE offers several advantages, making it an attractive option for entrepreneurs and businesses. Here are some key advantages: 

  • The UAE is between Europe, Asia, and Africa, making it a hub for international trade and business. 
  • Many free zones in the UAE offer 0% corporate and personal tax rates for a specified period, with the option to renew. 
  • The UAE has easier procedures for setting up businesses than many other countries. 
  • Businesses started in the UAE benefit from access to a growing market in the Middle East and North Africa (MENA) region. 
  • The UAE boasts a modern infrastructure, state-of-the-art facilities, and excellent connectivity conducive to business operations. 
  • The UAE economy is diverse, with booming sectors such as finance, tourism, real estate, and logistics. There are many business opportunities to start a business in Dubai.  
  • The UAE is known for its political stability and safety, providing a secure environment for business investments. 
  • Free zones in the UAE allow 100% foreign ownership of businesses. The 100% foreign ownership attracts international investors. 

Types of Business Setup in Dubai 

Types of Business Setups include mainland, free zone, and offshore setups. Each offers unique features and benefits for different business requirements. 

Dubai Free Zone Company Registration 

Registering a free zone company in Dubai offers many benefits. These include corporate tax exemption, Certain mainland regulations, and a very high business environment. Free zones are allowed to operate from the designated zones. You get 100% foreign ownership. 

These setups are particularly beneficial for international companies targeting specific industries, aiming for tax efficiencies, or needing a strategic location. Dubai’s free zones are important hubs for global businesses. They offer regulatory benefits and specialised infrastructure to different industries. 

Dubai Mainland Company Registration 

Companies registered on the mainland can trade freely across the UAE. They are eligible to lease or own property in mainland areas. This setup is ideal for businesses directly engaging with the UAE market. It offers products and services to local consumers. 

Mainland companies also enjoy advantages such as the ability to bid for government contracts.  Facilitating diverse business activities and opportunities for growth. 

Dubai Offshore Company Registration 

Dubai Offshore Company Registration offers businesses a compelling option for prioritising international trade and protecting assets. Without the need to adhere to local corporate taxes and regulations.  

These companies are well-suited for operations beyond the UAE. It provides privacy, confidentiality, and efficient international tax planning benefits. Offshore setups benefit holding companies, international trading ventures, and investment activities.  

Procedure for Business Formation in UAE 

Business formation in UAE is a relatively straightforward process. Here is the step-by-by process to guide you: 

Step 1: Choose a business activity  

Choosing a business activity is the first step. It is important to choose a business activity as it helps to get a license related to it. Choose an activity which will justify your business.  

Do you need help choosing a business activity? You can contact our Shuraa Experts.  

Step 2: Select a Jurisdiction 

There are three economic zones in the UAE: the Mainland, the Free Zone, and the Offshore. These zones are also known as jurisdictions. Each jurisdiction has laws and regulations for business setup and handles different business needs.  

Selecting a jurisdiction depends on the business resolution and matters for your business activity.  

Step 3: Choose the company structure/legal form 

When you want to start a business in the UAE, choosing the legal form for your business is important. This will help you manage your profits and losses and determine how to manage your assets and resources. This step should be taken when you start Business Formation planning.  

You can apply for a business license only after selecting a legal form. Below is a list of different legal forms which can help to register your business in the UAE: 

  • Sole Establishment 
  • Limited liability company (LLC) 
  • Holding company 
  • Local company branch 
  • Civil company 
  • Foreign company branch 
  • GCC company branch 
  • Free zone company branch 

Step 4: Choose a Company/Trade Name 

Once you have selected the company structure, it’s time to choose a good name for your trade business and register it. Remember to follow Dubai’s strict guidelines when selecting your company name. Choose a name that indicates your business nature and increases your company’s significance in the industry.  

Remember that when you choose a name, avoid using provocative names that may offend people’s religious feelings. If you need clarification about what name to choose, contact our experts, who will help you.  

Step 5: Decide the Business Location 

You must choose a business location after selecting a good name for your business. Your business location plays a significant role in the business game. To learn the merits and limitations of all the business zones, you can contact our Shuraa Advisors.  

We provide end-to-end business assistance from scratch. We help you develop your business better. You must get an ejari or tenant contract to get a business space. Then, you can get a good space in your selected area.  

Step 6: Apply for a Business License 

If you choose the mainland, you must apply for a license from the DED. If you choose the free zone, you can use their separate authorities. In addition, once you get a business license, it is important to get external approvals from other government bodies if required.  

There are 4 types of trade licenses in the UAE. 

Step 7: Register your company 

Company registration and licensing go side by side. The documentation and approval process has a different set of stages. You have to get all the necessary approvals from the government authorities as requested by the DED or Department of Economic Development. Note that the documents required are different for each company type and activity.  

Step 8: Open a Bank Account 

Once you have completed all the paperwork and documentation, you must open a business bank account for your company. Check the benefits; they can help you optimise your business’s costs.  

Documents Required for business formation in UAE 

The documents required for business formation in Dubai are as follows: 

  • Passport Photographs 
  • Passport copies of all the legal participants 
  • Application form 
  • MoA and LSA documents (notarised and attested) 
  • A copy of the LSA’s Emirati ID 
  • Tourist visa of the company registration applicant 
  • External approvals (if applicable) 
  • Ejari number for the verification of the rental space agreement / Business Centre sustainability contract 

What is the Cost of business formation in UAE? 

Company formation in UAE costs you around AED 12,500 to AED 28,500. However, there’s no fixed cost of business formation in Dubai. The costs of setting up the business include registering a business, obtaining license, company location, size of office, visa requirements, etc.  

To find out the exact cost of business formation, contact Shuraa Business Setup. We will guide you through the company registration process at very nominal rates.  

Partner With Shuraa For Seamless Company Formation 

We hope this guide on starting a business in the UAE gives you a hint of how to start your business. We have covered all the steps involved in company registration in the UAE. Our team of business setup experts in Dubai have already helped over 50,000 companies succeed in Dubai. Contact us to start your business formation in Dubai. 

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