Setting up a company in Dubai is an attractive option for entrepreneurs and investors who want to benefit from the dynamic economy, tax advantages and strategic location. In this article, you will learn everything you need to know about the different forms of company formation, the advantages and the legal requirements.

Why set up a company in Dubai?

Dubai has established itself as a global business center in recent years. It offers excellent infrastructure, a stable political environment and numerous incentives for foreign investors. The city is known for its Free Zones, where 100 % of foreign ownership is permitted, as well as its tax-free regulations.

Advantages of setting up a company in Dubai:

• Tax exemption: No income tax and corporation tax in most sectors.
• 100 % foreign ownership: No local sponsor is required, especially in the free trade zones.
• Strategic location: Dubai is ideally located between Europe, Asia and Africa and provides quick access to global markets.
• Modern infrastructure: Outstanding transportation and logistics systems as well as state-of-the-art technology infrastructures.
• Business-friendly environment: The government supports international investors by simplifying company formation processes.

Forms of business in Dubai

When setting up a company in Dubai, entrepreneurs have various options depending on their business model and target market. The most popular types of companies include:

1. Free Zone Company (Free Zone Company)

Dubai's free zones offer numerous advantages, especially for foreign investors. Companies in these zones benefit from 100 % of foreign ownership, tax incentives and simplified incorporation processes.

Advantages:

• No income or corporation tax.
• 100 % Repatriation of capital and profits.
• No import duties on goods imported into the free zone.

2. Mainland companies

A mainland company makes it possible to operate directly on the market in Dubai and the UAE. However, it requires a local sponsor that holds at least 51 % of the shares.

Advantages:

• Access to the internal market and government contracts.
• No restrictions on business activities within the UAE.

3. Offshore companies

This form of company is ideal for international business outside the UAE and offers tax advantages and confidentiality.

Advantages:

• Tax exemption on international income.
• Flexibility in international investments and business.

Steps to setting up a company in Dubai

Setting up a company in Dubai requires certain steps and compliance with local regulations. Here is a general overview of the most important steps:

1. Determination of the company formChoose the right corporate structure depending on your business model and target market (free zone, mainland or offshore).
2. Choice of business activityEach type of business requires a license, depending on the type of business (commercial license, industrial license, service license, etc.).
3. Register company nameThe name of your company must comply with UAE regulations and must not contain any prohibited terms.
4. Submission of documentsSubmit all necessary documents such as passport copies, incorporation certificates and company plans.
5. Obtaining the business licenseAfter approval of your documents, the business license will be issued to you.
6. Office rent and account openingDepending on the type of company, you may need to rent an office in Dubai and open a bank account.

Costs of company formation in Dubai

The costs of setting up a company in Dubai vary depending on the type of company, sector and location. In the free zones, incorporation costs are generally lower than for Mainland companies. The most important cost factors include:

• License fees
• Costs for registration
• Rental costs for an office
• Visa costs for employees

The advantages of setting up a company in Dubai

Setting up a company in Dubai offers tremendous opportunities for entrepreneurs looking to benefit from a global business environment, tax incentives and a business-friendly climate. Whether you are a start-up, an established business or looking to expand internationally, Dubai offers a wealth of opportunities to succeed. With the right information and a clear business strategy, you can gain a foothold in one of the world's most dynamic business centers.