What do business setup services entail, and how can you identify the appropriate setup services for establishing your business in Dubai?

 

Why Does Everyone Want to Start a Business Setup in Dubai?

Dubai has experienced remarkable growth in a relatively short period, making it an appealing destination for entrepreneurs to start their businesses. The Department of Economic Development (DED) in Dubai has observed a 13% annual increase in new startups choosing to operate in the city. Dubai's thriving economy offers numerous opportunities, particularly in sectors such as services, finance, trade, real estate, and properties that generate profits. Additionally, Dubai is known for its diverse and cosmopolitan environment in the Middle East.

 

Reasons why a foreigner should start a Business Setup in UAE

1. Tax Benefits: Companies incorporated in Dubai are not subjected to corporate tax, withholding tax, VAT Registration, import/export tax, or capital gains tax.

2. Double Tax Avoidance Treaties: The UAE has signed over 66 international double tax avoidance treaties with key countries like China, the USA, and many EU members, providing additional tax benefits and reducing the risk of double taxation.

3. Currency Accessibility: Foreigners have easy access to the local currency as there are no exchange controls in place.

4. Multicultural Environment: Dubai is a multicultural city with a diverse population from around the world. This creates a vibrant atmosphere and keeps the city up-to-date with the latest trends and developments. It also offers a wide range of international cuisines for food enthusiasts.

5. Shopping and Tax Benefits: Dubai is a shopping paradise as it does not impose VAT. Additionally, residents are exempt from paying personal income tax.

In summary, starting a business setup in Dubai provides tax advantages, international tax treaties, currency accessibility, a multicultural environment, and tax-free shopping opportunities.

 

Business setup in Dubai

To start a business setup in Dubai, the first step is to choose the right company type for your venture.

Opting for a business setup in a Dubai-free zone is strongly recommended. In a Dubai-free zone company, foreign investors can have full ownership (100%) of the company.

However, if you opt for a Dubai Limited Liability Company (Dubai LLC), foreigners are typically limited to owning up to 49% of the company. The remaining 51% of shares must be owned by a UAE national. In exceptional cases, the government authorities may grant permission for a 100% foreign-owned LLC.

 

Advantages of Setting Up a Business in Dubai

1. Thriving Economy: Dubai's economy has experienced rapid growth, making it an attractive destination for business. Companies from around the world are shifting their operations to Dubai, which has become a hub for startups and established conglomerates.

2. Skilled Workforce: Dubai offers a liberal and cost-effective labor market, making it easier to find skilled employees. The city's desirable location and favorable labor laws allow businesses to recruit talent from various parts of the world and scale their workforce as needed.

3. Local Sponsorship: While it is a requirement for certain business types in Dubai to have a local sponsor or Emirati partner, this arrangement has its advantages. A local sponsor can provide valuable insights into the local market, and industry connections, and navigate cultural nuances. They act as a liaison with government authorities, enabling smoother operations and local compliance.

4. Excellent Infrastructure and Reputation: Dubai provides world-class infrastructure, including transportation, healthcare, education, business parks, and corporate spaces. Its strategic location and strong business reputation make it an ideal place to start and attract businesses.

5. Favorable Business Laws: The UAE government offers a business-friendly environment with laws and regulations designed to support foreign investors. The government continuously amends laws to make them more favorable for foreign investment, streamlining licensing and registration processes.

6. Tax Benefits: Dubai's tax system provides various ownership patterns and tax categories. Free Zones, in particular, offer 100% tax exemptions, including 0% corporate and income tax. This means business owners can enjoy significant tax savings as they are not required to pay taxes to the government.

In summary, Dubai offers a thriving economy, skilled workforce, excellent infrastructure, favorable business laws, and attractive tax benefits, making it an ideal destination for setting up a business.