Setting up a company in the UAE
The UAE is a common base for founders who trade across the Gulf, Africa and South Asia. A UAE company can hold a trade licence, sponsor residence visas for owners and staff, and open a local corporate bank account. Since the Commercial Companies Law was amended in 2021, foreign investors can own 100% of a mainland company for most activities, which was previously limited to 49%.
The main decision is where to register. Each emirate has its own mainland licensing authority, and there are more than 40 free zones, each with its own rules, activity lists and office requirements.
Who this is for
- Founders moving to Dubai, Abu Dhabi or another emirate who need a company to sponsor their residence visa.
- Trading, consulting and e-commerce businesses selling into the Gulf region.
- Indian, Pakistani, UK and African founders who want a regional hub alongside a US or home-country company.
Mainland or free zone
| Mainland company | Free zone company | |
|---|---|---|
| Licensing authority | The emirate's economic department, such as Dubai's DET | The free zone authority, such as DMCC, IFZA, Meydan or SHAMS |
| Foreign ownership | Up to 100% for most activities; some strategic activities are restricted | 100% |
| Where you can trade | Anywhere in the UAE, including government contracts | Inside the zone and internationally; mainland trade usually needs a distributor or extra permit |
| Office | A physical office lease registered with the authority (Ejari in Dubai) | Flexi-desk or virtual options at many zones |
| Corporate tax | Standard UAE corporate tax rules | A 0% rate may apply to qualifying income if the company meets the Qualifying Free Zone Person conditions |
If most of your customers are UAE businesses or consumers, a mainland licence is usually simpler. If you mainly invoice clients abroad, a free zone is often cheaper to run.
Corporate tax in brief
The UAE introduced federal corporate tax for financial years starting on or after June 1, 2023. Taxable income up to AED 375,000 is taxed at 0% and income above that at 9%. Most companies must register with the Federal Tax Authority even if they owe nothing. Free zone companies need to meet specific conditions to keep a 0% rate on qualifying income. This is general information, not tax advice; confirm your position with a UAE tax adviser.
What BookMyLLC handles
- A short review of your activities to recommend mainland or a specific free zone.
- Trade name reservation, with three name options prepared in the required format.
- Initial approval and licence application with the chosen authority.
- Preparing and arranging notarisation of the Memorandum of Association where required.
- Office, flexi-desk or virtual office setup to meet the licence requirement.
- Guidance on investor visa applications and corporate bank account documents.
Step-by-step process
- Choose jurisdiction and activities. Your licence lists the activities you may carry out, so these are chosen first.
- Reserve a trade name. Names must follow UAE naming rules; offensive, religious or government-sounding names are rejected.
- Initial approval. The authority confirms it has no objection to you setting up.
- Documents and office. The MoA is signed and the office or flexi-desk is arranged.
- Licence issued. Once fees are paid the trade licence is issued.
- Establishment card and visas. The company registers with immigration so it can sponsor visas, then the owners apply.
- Bank account. With the licence and visa in hand, you apply for a corporate account.
Documents you need
- Passport copies for every shareholder and manager.
- A passport-size photo and, where you already have one, a UAE visa or entry stamp.
- A short business plan or activity description; some authorities and banks ask for more detail.
- For a corporate shareholder: certificate of incorporation, articles and board resolution, often attested.
- Proof of address for each shareholder.
Timeline
Free zone licences are typically issued within about one to three weeks once documents are complete. Mainland setups can take longer because of the office lease step. Visas and bank accounts come after the licence and usually add a few more weeks.
Common mistakes to avoid
- Choosing a free zone to save money, then needing mainland customers. Moving later means a new licence.
- Picking too few activities. Adding activities later costs time and fees.
- Assuming a licence means a bank account. UAE banks run their own checks and can decline.
- Forgetting renewals. Licences and establishment cards renew yearly, and late renewals attract fines.
After the licence: ongoing obligations
Getting the licence is the start, not the end. A UAE company has regular obligations, and missing them leads to fines or problems with visas and banking.
- Licence renewal every year with the mainland authority or free zone.
- Establishment card renewal, which keeps the company able to sponsor visas.
- Corporate tax registration and returns with the Federal Tax Authority, even where the tax due is zero.
- VAT registration once taxable supplies pass the mandatory threshold, with returns usually filed quarterly.
- Ultimate beneficial owner records kept up to date with the licensing authority.
- Economic substance and audit requirements, which depend on your activity and free zone; some zones require audited accounts every year.
We give you a calendar of these dates at setup. If you also run a US company, the two sets of deadlines sit side by side so nothing is missed.
Related services
Many UAE founders also run a US company to sell to American customers. See US LLC formation, compare regional options with Singapore and UK company registration, or book a call to talk through your structure. Our fees are on the pricing page.
UAE company at a glance
| Question | Short answer |
|---|---|
| Two main routes | Mainland licences and free zone licences. |
| Foreign ownership | Full foreign ownership is available on both routes for most activities. |
| Licence | Tied to a business activity; your activity decides which authority issues it. |
| Office requirement | Mainland needs a leased office; free zones often offer flexi-desk options. |
| Visas and banking | Follow the licence; allow extra weeks. |
Costs to plan for
| Cost | When |
|---|---|
| Licence fee | Yearly renewal |
| Office or flexi-desk | Yearly lease |
| Visa and Emirates ID | Per person, renewed periodically |
| Bank account fees | Monthly or yearly |
| Corporate tax and VAT | As the UAE law requires |
Total cost depends on the zone and your activity, so we quote after we understand what you will do.
Choosing between mainland and free zone
A free zone licence is quicker and often cheaper to set up, and suits companies that trade internationally or serve customers online. A mainland licence lets you trade directly in the local market and bid for government contracts, at the cost of a leased office and more steps. The activity you plan decides which options are open, so we start from what the company will do.
Banks look closely at UAE companies. Be ready to explain your business, your customers and where your money comes from, with documents to support each point.
Tax and compliance after the licence
- Corporate tax registration as the UAE rules require.
- VAT registration once turnover passes the threshold.
- Annual licence renewal and lease renewal.
- Accounting records kept for the period the law sets.
The UAE's tax rules are recent and have been developing, so we check the current position at filing.
Documents we typically need
| Item | From |
|---|---|
| Passport copies and photographs | Each shareholder and manager |
| Proof of address in your home country | Each shareholder |
| Proposed trade names | You |
| Description of business activities | You |
| Visa application details, if staff will relocate | You |
