Dubai Company Formation

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Opening a company in Dubai

Why open a company in Dubai? What are the advantages in the state of Dubai?
Dubai is a convenient solution for many entrepreneurs.

The local currency is the Emirati Dirham (AED), and living is relatively cheap in the country.

This is a local market that understands the English and Arabic language very well.

From Dubai, in principle, one third of the world's population can be reached within up to 8 hours of flight.

In Dubai there is no patience for nonsense, and there is an atmosphere of security and safety.

The working week in Dubai is Monday to Friday. Saturday and Sunday are the days of rest.

In the month of Ramadan, they work 2-3 hours less.

This is a very large population of immigrants from all places.

Dubai has many international business opportunities.

Dubai has good hospitality as a matter of culture: business can be conducted over a cup of tea, coffee, lunch or dinner.

Real estate in Dubai
Many companies open for investment in Dubai. Because Dubai has many expats, and the city has about 3 million people, it makes sense that there will be many real estate opportunities.

The main way to purchase real estate in Dubai is through the establishment of a limited company in Dubai.

A company with a crypto license in Dubai - virtual currencies in Dubai
In Dubai you can open a company and issue various licenses related to virtual currencies. Among them is a license for a trading exchange, a license for issuing a virtual currency (ICO), a license for issuing a crypto "wallet", and more.

The advantages of a company in Dubai
-A company in Dubai is 100% owned, meaning no local partner from Dubai is needed. The whole company can be owned by a foreigner. In Dubai you do not need any Emirati citizenship to open a company. You can open a company in Dubai even if you are a foreign citizen. This means that it is possible to open the company with 100% shareholding in the name of a foreign citizen - in your name, or even in the name of a foreign company. The director can be foreign and there is no need for a local director.

- The company can be opened with only one shareholder, who is also the director.

- After the opening of the company, a visa can be issued.

- After opening the company, you can open a bank account for the company in Dubai, as well as a private bank account.

- The very existence of the company is kept secret, if that's what you want.

- Under certain conditions there is 0% tax on the company's income.

- If the company's business has ended, the company can be dissolved at any time

- International business can be done through the company in Dubai

- The company can engage in several branches or activities

- The company can own real estate assets

- It is easy to do business with the company in Dubai

- The company in Dubai has government support

- Dubai has a solid network of international and local commercial banks

The process of opening a company in Dubai
The entire process of opening a company in Dubai is done remotely without coming to Dubai

Opening a company in Dubai begins with defining the customer's needs.

4 questions must be asked:

  1. What is the company's business? That is, what is the planned activity of the company? Regarding this point, it will be checked whether a license is needed for this activity.
  2. Do I need a residence visa?
  3. Do you need physical offices for the company?
  4. In which "free-trade-zone" in Dubai does the client wish to submit the company?

Below we will define in depth what a "free trade zone" is, but in short, Dubai is divided into about 20 free trade zones where the company can be registered. You can say that it is similar to the process of opening a company in the USA, where it is required to choose in which country the customer wishes to open the company (California, Florida, Delaware, etc.).

After collecting the above data, the request must be submitted through a licensed attorney in Dubai, like us, in the requested free trade zone. After submitting the application, the company is opened and a certificate of incorporation is received.

A visa for staying
After opening the company, the residence visa must be issued.

First, a card called an establishment card must be issued, which is valid for 12 months. On the basis of this card, the stay visa can be issued, which will be valid for 3 years.

The conditions for issuing the visa are a bit special for Dubai: a medical examination is required, an Emirati ID card must be issued which involves taking a fingerprint and an eye scan, and medical insurance must be issued.

In all of the above, assistance will be provided on our behalf.

To keep the visa valid, it is required to visit Dubai every 6 months, even if the visit is for one day.

Bank account in Dubai
After receiving the visa, you can go to the bank independently and open an account for the new company.

physical offices
As part of our service repertoire, we can offer a connection with various local offices for the purpose of renting an office or hotdesk.

Equity Requirements
No equity is required to be deposited. All companies are opened with a minimum equity capital of 10,000 Emirati Dirhams (10,000 NIS) but the rule is that it is not required to actually deposit it.  The exception to this rule is that if the person is defined as a "manager" in the stay visa, the minimum equity is 48,000 and it is required to actually deposit it.

How long does it take to register a company in Dubai
It takes 3 weeks to open the company, and then the owner has to arrive within 60 days to Dubai to complete the issuance of the overstay visa. When the owner arrives, you have to plan for 7 days for the visa to be issued.

VAT registration
After the opening of the company, at the same time as the opening of the current bank account for the company, the registration of the new company with VAT will also be carried out. The company will receive a VAT number and can start trading.

Company maintenance
The company requires annual maintenance of payment of fees, annual submissions, local address (which we will provide for you), as well as submissions to the tax authority.

free trade zones
As mentioned above, Dubai is divided into about 20 free trade zones, which in English are called freezones. A company can be established in each of them. A company established in a free trade zone is added the name FZCO which is an abbreviation of Free Zone Corporation.

A free trade zone is a geographical area where the tax is reduced or non-existent.

It is quite similar to Eilat, in the context of the fact that there is no VAT there.

The levels of regulation on companies established in the free trade zones are lower than "regular" companies, meaning companies established in Dubai to trade within Dubai.

All free trade zones have great advantages, such as:

100% exemption from income tax and corporate taxes
100% return of capital and profits
100% exempt from import and export tax
Unlike most companies in other countries, in the United Arab Emirates the company must specifically list its field of activity. Different free trade zones have different lists of possible activities.

Example of a free trade zone: Dubai Silicon Oasis - Dubai Silicon Oasis

Dubai Silicon Oasis (DSO) is a free zone established in 2004, and it covers an area of ​​7.2 square kilometers.

It is a technology-focused free zone, making it a very convenient free zone under which to set up a company in Dubai. The free zone of Dubai Silicon Oasis is perfect for both working and living in the same area. Dubai Silicon Oasis also offers a whole bunch of incentives and benefits to companies that come to enjoy the benefits of the free zone. Dubai Silicon Oasis is strategically located, in the middle of a network of roads. It allows quick and easy access to Dubai's highways, as well as access to any location in Dubai Silicon Oasis within approximately 20 minutes' drive.

The main advantages of opening a company in this free trade zone:

  • You can choose occupations from among 1500 areas allowed in this free trade zone.
    Crypto licenses - virtual currencies.
  • It is possible to combine professional (liberal professions), commercial and industrial (production) activities under one license.
  • Fast and efficient establishment process of the company.
  • There is no need for the customer to be physically present.
  • There is no requirement to deposit the equity.
  • Lifetime residence visa for business owners and employees.

Another excellent free trade zone is DMCC.

Tax in Dubai
As of 2023, there is a 9% tax in Dubai, also in the free trade zones. However, a company established in a free trade zone may still receive a reduction of the tax rate to 0%, but there are very specific requirements that must be met for this.

In short, to be eligible, the company is required to apply for "small business relief": the income (not profit) must be less than 3 million per year, this year and the previous year. If the income is over 3 million per year, check how much the profit is. If the company's profit is over 375,000 per year, then the company will start paying tax.

Questions and answers
Question: Is it necessary to physically fly to Dubai to open a company in Dubai?
Answer: The entire process of opening the company is carried out remotely and at no stage is it necessary to physically come to Dubai. However, the process of issuing a stay visa and opening a bank account are physically carried out in the country, so it is necessary to fly after opening the company in Dubai.

Question: How can I find a good accountant to handle our new Dubai company?
Answer: We will connect you with a local accountant.

Question: What type of company in Dubai should I open?
Answer: In Dubai there are broadly two relevant types of companies. A "regular" company, and a "free trade zone" company.

What is the difference between "regular" companies and "free trade zone" companies? Companies in free trade zones can conduct business in Dubai only with other free trade zone companies, but of course with any customer outside the United Arab Emirates. A regular company is not so restricted and can do business with anyone in or outside the UAE.

If you wish to physically trade with customers in the Dubai area (ie outside a free zone), you will be required to open a "regular" company.

In the past, the disadvantage of a "regular" company is that it must be owned 51% by a local Emirati resident, while a free trade zone company can be 100% owned by the customer - a foreign person for the purpose of the example. This rule was canceled in November 2020, and today both types of companies can be 100% owned by foreign citizens.

Because of the tax exemption, almost all the companies that open are "free trade zone" companies, and not "normal" companies.

Question: Who provides the local address for the new Dubai company?
Answer: We will provide the local address.

In Dubai, for a "normal" company (not open in a free trade zone), physical offices are a mandatory condition for most activities. For "free trade zone" companies, physical offices are not mandatory, except if the company has 4 worker visas, in which case physical offices are required (it will be necessary to show a lease).

Question: Do you need an Emirati passport to open a company in Dubai?
Answer: There is no need for an Emirati passport. We can open a company in Dubai for any foreign citizen as long as he has a valid passport.

Question: How long does it take to open a company in Dubai?
Answer: The process of opening the company, including signing the power of attorney and sending it, should take about 3 weeks. After that, the process of issuing the visa and opening the bank account can take only 7 days. Of course, these are times that depend on third parties, so this is only an estimate.

Question: Is it possible to open a company in Dubai for a person with American citizenship or a person living in the USA?
Answer: Yes. We know how to open a company in Dubai for a person with American citizenship or a person living in the USA.

Question: How much does it cost to open a company in Dubai?
Answer: Click here to contact us and get an up-to-date quote for free!