Company Formation · Dubai, UAE
Business Setup in Dubai & the UAE
UAE business setup comes down to one choice: a mainland licence or a free zone licence. Since 2021, 100% foreign ownership applies to most activities — so the right structure depends on where you will trade, visas and tax, not on needing a local partner.
Exiloz Management & Tax Consultant · Dubai-based advisory · setup, PRO, VAT, corporate tax & accounting
Mainland vs free zone — how to decide
The first real decision in UAE business setup is jurisdiction. A mainland company is licensed by the emirate's economic department and can trade directly across the UAE market, open most retail locations and bid for government and semi-government contracts. A free zone company is licensed by one of the country's 40+ free zones (such as IFZA, Meydan Free Zone, DMCC, SHAMS or RAKEZ), each with its own activities, packages and visa allocations, and is well suited to international trading, holding and service businesses.
- Mainland: trade anywhere in the UAE, wider activity list, eligible for government tenders
- Free zone: 100% ownership by default, streamlined setup, customs advantages for re-export
- Free zone tax: a Qualifying Free Zone Person can apply 0% corporate tax on qualifying income
- Ownership: 100% foreign ownership now applies to most mainland activities too (strategic-impact activities excepted)
Not sure which fits? Compare them side by side in our mainland vs free zone guide.
How company formation works, step by step
Whichever route you take, the sequence is broadly the same. Exact approvals depend on your activity, and some regulated activities (such as financial, medical or education) need external approvals before the licence is issued.
- Confirm business activity and legal form (LLC, sole establishment, branch or free zone company)
- Reserve a trade name and obtain initial approval
- Arrange the office or flexi-desk / lease (Ejari for mainland) as the activity requires
- Pay fees and receive the trade licence and, for mainland, the establishment card
- Process investor and employee visas, then open a corporate bank account
- Register for corporate tax, and for VAT once turnover reaches the threshold
See the full walkthrough on our company incorporation page.
PRO services, visas and document clearing
Once a licence is live, the ongoing government paperwork — MOHRE labour files, GDRFA immigration and establishment cards, Emirates ID, medicals, Ejari and document attestation — is handled through PRO (Public Relations Officer) services. Getting this right keeps visa quotas, renewals and amendments moving without penalties.
- Establishment card, labour and immigration file setup
- Investor, partner and employee visa processing and renewals
- Licence amendments, activity additions and renewals
- Attestation and clearing of contracts and official documents
Explore PRO & document clearing and the PRO setup fee schedule.
Tax and compliance once you are trading
A UAE licence brings ongoing obligations. Corporate tax applies at 9% on taxable profit above AED 375,000 (0% below), and every taxable person must register and file even if the result is nil. VAT registration is mandatory once taxable turnover reaches AED 375,000, and voluntary from AED 187,500. Keeping proper books from day one makes both straightforward.
Customs, ICV and tax-free retail
Businesses that import, export or supply to government and industrial buyers have a few extra registrations. Traders need a customs client code and file declarations through Dubai Customs' Mirsal 2 system. Suppliers to ADNOC and government entities are scored on In-Country Value (ICV). Retailers selling to tourists can join the Planet tax-free (VAT refund) scheme.
- Customs registration and Mirsal 2 for importers and exporters
- ICV certification to compete for government and ADNOC supply contracts
- Planet tax-free / tourist VAT refund registration for retailers
Business setup guides & resources
Frequently Asked Questions
How much does it cost to set up a company in Dubai?
Cost depends on the activity, whether you choose mainland or a free zone, how many visas you need and any external approvals. Free zone packages and mainland licences are priced differently by each authority, and government fees change, so the reliable figure is a written quotation for your specific activity and visa count rather than a single headline price.
Do I need a local Emirati sponsor to set up in the UAE?
For most mainland commercial and industrial activities, no. Since the 2021 amendment to the Commercial Companies Law, 100% foreign ownership is allowed for the majority of activities, so a local partner is not required. A limited list of strategic-impact activities and certain professional structures still have specific rules, which should be confirmed for your exact activity.
Is mainland or free zone better for my business?
A free zone suits international trading, holding and service companies that want 100% ownership and simple setup, and a Qualifying Free Zone Person can access 0% corporate tax on qualifying income. A mainland licence suits businesses that need to trade directly across the UAE market, open certain retail locations or take government and semi-government contracts. Many groups use a combination of both.
How long does company formation take in the UAE?
Straightforward free zone or mainland licences can be issued within a few working days once documents and approvals are in place. Activities that need external approvals, or complex ownership and visa requirements, can take a few weeks. The main variables are the activity, the authority and how quickly documents are provided.
Do free zone companies pay UAE corporate tax?
UAE corporate tax applies at 9% on taxable profit above AED 375,000. A free zone company that meets the conditions to be a Qualifying Free Zone Person can apply 0% to its qualifying income, but it must still register, keep audited accounts and file. Free zone status does not remove the obligation to register and file.
What do I need to do after the company is set up?
After licensing, typical next steps are opening a corporate bank account, registering for corporate tax, registering for VAT if turnover reaches the AED 375,000 threshold, setting up bookkeeping, and processing establishment card and visas through PRO services. Traders also need a customs client code, and companies supplying government or ADNOC entities may need ICV certification.
Planning a company in Dubai or the UAE?
Talk to the Exiloz team about the right structure, licensing, PRO and the tax registrations that follow — general guidance now, a written quotation when you are ready.