Start a Small Business in the UAE in Six Simple Steps


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There are many reasons why so many entrepreneurs from around the world choose to do business in the UAE.

The country’s favourable tax regime is a considerable draw, levying zero percent on both personal and corporate incomes. There’s also the UAE’s strategic location at the heart of the Middle East which makes it the perfect hub from which to conduct global trade.

Set up in one of the country’s free zones and the advantages keep coming – 100% exemption from customs tax, no currency restrictions, and the ability to repatriate all capital and profits to name just a few.

Finally, there’s the UAE’s incredibly simple company formation process which, providing you’re familiar with the way business is done in this part of the world, can be completed in just a few simple steps.

How to open a small business in Dubai/the UAE

There are just six steps required to open a small business in Dubai or the UAE.

ONE: Decide your business activities

The first step in forming your UAE business is to decide on your business activities. There are thousands of potential activities to choose from and it’s vital that you list any you intend to carry out on your license application.

Failure to specify every one of your intended activities could lead to issues further down the line. For this reason, it is advisable to work with a company formation expert when making this decision. Such experts are familiar with permitted activities and will be able to suggest those that align best with your business.

TWO: Choose a company name

With your business activities outlined, it’s time to choose your company name. There are a few things to keep in mind when naming a business in the UAE. Here you must abide by a strict, yet easy-to-follow, set of naming conventions. Once again, a company setup expert can help you with this step.

In short, you should avoid any offensive or blasphemous language. Avoid names of well-known organisations and avoid abbreviations if naming your company after yourself – i.e. Dave Mann Consulting, rather than D Mann Consulting. You must also check that your chosen name is available to register.

THREE: Choose a setup – free zone or mainland?

The final step before making your license application is to decide whether you wish to establish your business in a free zone or on the mainland.

There are many advantages to both. Free zones offer benefits such as a quick and easy incorporation process, ongoing business support and financial incentives such as tax exemptions and zero currency restrictions.

Mainland business, on the other hand, allows you to trade directly with the UAE market and take on potentially lucrative government contracts.

The setup that’s right for you will depend on the nature of your business. Again, a company formation expert can advise on the best approach.

If the cost of opening a small business in Dubai figures significantly in your decision-making process, worry not, as costs are comparable whether you opt for a free zone or mainland setup.

FOUR: Applying for your business license

One of the most important requirements to start a small business is of course a business license.

Obtaining a license for a small business is a simple process for both free zone and mainland companies. The requirements to start a small business in the mainland is as follows: apply for your license directly to the Department of Economic Development or the Municipality in the Emirate in which you are setting up. In most cases, mainland license applications take around three weeks.

Should you wish to do business from a free zone, you’ll need to apply directly to the relevant governing authority. Free zone licenses can often be granted in a matter of days depending on the nature of your business and the license required. To ensure a smooth process, it is once again a good idea to instruct the services of a company formation specialist at this stage.

Whether making your application yourself, or through a company formation agent, you are usually only required to provide a few details and some basic documentation, including:

  • Completed application form
  • Passport copy of the proposed owner or owners
  • Two colour passport size photos.

If you’re wondering how to start a business in Dubai with little or no money, free zones are often a good option. Free zones offer many affordable license packages with no paid-up share capital requirement, no annual audit, and an easy incorporation process. There is also no need to be present in the UAE to establish your new company.

FIVE: Applying for visas

Another one of the key requirements to start a small business is a UAE visa. The process for applying for your own visa, as well as those of your employees, is particular, yet straightforward. Again, an expert in UAE company formation can help you with this step.

As the holder of a UAE business license, you can also sponsor others for their visas too. This could be a spouse, parent or child, or a domestic worker such as a housekeeper.

The maximum number of visas you can apply for will depend on the size of your company, your chosen setup and, for dependant visas, your personal earnings.

SIX: Opening a corporate bank account

The UAE’s strict money laundering regulations make it difficult for overseas entrepreneurs to access corporate banking facilities. Working with an expert in the field makes for a much smoother process.

Company formation experts have great links to both local and international banks and can easily put you in touch with the one best suited to your needs – even arranging face-to-face meetings if necessary.

If you are looking to get your company license in the UAE, free zone, or mainland, or even in Qatar and Saudi Arabia –  then our team can help.

Ready to start your small business in the UAE?

While the steps needed to start a business in the UAE are not overly complex, it does require a level of prior knowledge of the process. What’s more, it is important to note that the application process is only straightforward if your business application is complete at the time of submission and free from errors.

To help you ensure that this is the case, it’s a good idea to work with a company formation specialist when establishing a new company in the UAE.

As well as handling your license application, a company formation expert can also assist with the opening of corporate bank accounts and advise on the most appropriate financial institution to suit your specific needs.

Many also offer visa and immigration services and can handle all government formalities, permissions, work permits and visas applications that are required to trade in the UAE.

In short, company formation experts can establish your company on your behalf, make your license and visa applications, and take care of all the necessary admin – leaving you free to concentrate on what you do best.

We are the team of Set Hub, your best business setup advisor across the Gulf Region. If you are looking to open your company in Dubai, across the UAE, in KSA or Qatar, get a free zone license, or start a business in the mainland, then we can help. From visa applications to all the necessary admin tasks, we handle it all – leaving you free to get on with your business.