For international entrepreneurs looking to do business overseas, the United Arab Emirates ticks all the boxes.
It’s famed for its open, encouraging and dynamic business environment – one that sees it regularly rank highly in the Ease of Doing Business Index.
Its Middle East location puts it within easy reach of two-thirds of the world’s population and overlaps with time zones in most major business hubs.
Then there’s the much-lauded UAE tax rate which still stands at 0% on all income, both personal and corporate.
Company formation in a UAE free zone brings with it further benefits. Free zone businesses can also take advantage of full repatriation of capital and profits and 100% customs tax exemption.
Setting up here is also very affordable, with license packages to suit businesses of all sizes and budgets.
Last, and certainly by no means least, is the UAE’s simple company formation procedure. When undertaken with the help of an expert setup agent, you can be running your UAE business within days.
UAE company formation cost
Let’s start with a major pull for business owners in this part of the world – UAE company formation cost.
The cost of company formation in the UAE depends on a wide range of factors. If you wish to keep costs low, you may want to consider setting up as a freelancer. Equally, you could apply for a full business license as a solo entrepreneur.
If you’re looking to find the cheapest company formation in the UAE, company formation in a UAE free zone is probably the best option. Free zone license packages are available from just AED 9,600. You can also combine the cost of your trade license along with that of your visa to reduce total costs. The more visas you require, the more your costs will increase.
The type of license you require will also have a bearing on the total price you’ll pay.
For consultancy and service activities, free zone licenses range from AED 9,600 with no visa application, up to AED 19,700 inclusive of the cost of three visas, AED 24,700 inclusive of six visas, and so on.
For trading activities, license packages start from AED 11,500 without a visa application, and again up to AED 19,700 inclusive of the cost of three visas, and AED 24,700 inclusive of six visas
A step-by-step guide to company formation in the UAE
Your first big decision concerns your business activities. Not only must your licensed activities match exactly to those you intend to carry out, your chosen activities will also determine the best setup type for your business and the license that you require.
The activity or activities that you choose will depend on the nature of your business. For example, if you are a manufacturing business, you must detail exactly what it is that you manufacture.
With the help of a company formation expert you are sure to find an activity or activities that cover your business. What’s most important is that you clearly state each one that you intend to carry out when making your application.
Next, you must choose your company name. When doing this, you’ll need to adhere to the UAE’s naming criteria.
You cannot include any offensive or blasphemous language, nor any references to Allah or Islam in your company name. If you wish to include your name in your company name, you must use it in full rather than just your surname or initials. You must also check that your chosen name is available to be registered.
Now for the most important step – applying for your company license.
If you haven’t already, it is a good idea to consult with a company formation expert before undertaking this next step as any mistake can cause costly delays.
The process here is slightly different depending on whether you have chosen to set up a free zone or mainland business.
If you’ve decided that the mainland is a better base for your business, you’ll need to make your application directly to the DED or the equivalent in another emirate. Most of this process takes place online.
Alternatively, if you have decided on a free zone setup then you can make your application directly to your chosen free zone. As free zones are self-regulated, the process is faster and more efficient. This is yet another reason why free zone company setup is often the most straightforward and cost-effective method of starting a business in the UAE.
You can now apply for your visa.You can do this yourself or, once again, work with a company formation expert who can manage the application as part of the business incorporation process.
You will need to visit an immigration centre during the process to provide biometric information. The visa application also includes a fitness test, blood test and chest x-ray.
Providing you meet the salary criteria, it is also possible to sponsor others for their UAE visas too, such as your children, partner or parents.
The final requirement before you can start trading in the UAE is a corporate bank account.
The UAE is home to a wide range of banking institutions, both local banks and international brands. However, bank account opening can be a complex process for overseas business owners, so it is best to make your application with the help of an expert who is well-versed in the process and its requirements.
Your simple route to company formation in the UAE
The company formation process in the UAE has been designed with simplicity in mind. That said, it does take some in-depth knowledge of the region and its many customs and regulations.
That’s why it’s always advisable to acquire the services of a business setup company who can not only advise on the process but also seek out the most suitable license and setup type for your business, based on your needs and your budget.
When you use business setup services, you also gain peace of mind that your license and visa applications are free from errors and omissions – both of which can lead to delays and rejection.
When you work with a company formation specialist, all you need to provide is some basic documentation and a little information about the nature of your business. Then, sit back and let the experts take care of the rest – managing your license and visa applications, communicating with all relevant departments and authorities, and reporting back when you’re ready to start trading. It really is that simple.