Launching a business in the UAE offers an excellent opportunity to obtain a residence visa. The minimum investment to qualify for a visa starts at $136,000. The UAE is known for its favorable business conditions, such as minimal corporate taxes, low VAT (5%), and the ability to register businesses remotely, including through virtual commercial zones.
Why Entrepreneurs Choose the UAE
In a survey of 2,000 entrepreneurs from 50 countries, several factors were highlighted as key reasons for choosing the UAE:
- Strong business development and innovation ecosystem
- Well-established financial infrastructure
- Supportive government measures for businesses
- Simplified business registration process
The UAE government has digitized many of its services, making it easier for entrepreneurs to register companies and manage operations through apps like DubaiNow and UAE PASS—the latter acting as a digital signature enabling access to over 6,000 services.
Tax Benefits for Businesses in the UAE
The UAE’s tax policies are highly advantageous. Companies in the UAE are exempt from corporate taxes until June 2023. After that, businesses earning over AED 375,000 (about $102,000) annually will be subject to a 9% corporate tax. VAT in the UAE is also just 5%, significantly lower than in other countries like Germany (19%) and the UK (20%).
Free Economic Zones in the UAE
The UAE offers numerous free economic zones (FEZ), each with specific tax benefits and industry focuses. Companies registered in these zones enjoy exemptions from corporate tax, VAT, and import/export duties. Each FEZ caters to different industries, such as Dubai Healthcare City for healthcare companies and Dubai Internet City for IT and telecom firms.
Types of Business Entities in the UAE
To operate in the UAE, entrepreneurs can choose from several types of business structures, including mainland, offshore, and onshore companies.
Mainland Companies: These entities can operate across the entire UAE, providing flexibility to sell goods, offer services, and expand branches throughout the country.
Offshore Companies: Offshore companies are registered in free zones and can only operate outside the UAE, offering a gateway to international business.
Onshore Companies: These companies can operate within the free economic zones and internationally. Owners of onshore businesses can also secure residence visas for themselves, their families, and employees.
Steps to Open a Mainland Company in the UAE
- Obtain Initial Approval: Start by getting a preliminary permit from the General Directorate of Residency and Foreigners’ Affairs.
- Sign a Service Agent Contract: This is required to facilitate interaction with government offices.
- Rent or Buy Office Space: A commercial space is mandatory for company registration.
- Submit Documents: Required paperwork includes a memorandum of association, business license, and contract with a service agent.
- Receive an Establishment Card: Once all steps are complete, an Establishment Card is issued, allowing owners and employees to obtain residence visas.
Offshore Company Registration
Offshore companies are ideal for those looking to operate outside the UAE. These businesses are usually registered in free zones and enjoy similar tax benefits. However, they cannot engage in business within the UAE or obtain UAE residence visas for owners or employees.
"The UAE is not just a place to do business; it’s where opportunity meets innovation, creating endless possibilities for entrepreneurs worldwide."
Benefits of UAE Business Ownership
- 100% foreign ownership in many sectors
- Tax exemptions for companies in free economic zones
- Ease of registration through online government portals
- Residence visa options for business owners, their families, and employees
Starting a business in the UAE offers not only tax benefits but also an efficient process for obtaining a residence visa, making it a top destination for global entrepreneurs.
