Are you an entrepreneur or business owner interested in entering the Dubai market? The UAE, particularly Dubai, offers outstanding growth opportunities supported by a robust economy and a favorable business environment.
One of the main challenges when starting a business in Dubai is navigating the complex legal requirements and selecting the appropriate business license for your goals.
As a reputable business consulting firm with over 17 years of experience in company formation in Dubai, we’ve created this article as an essential guide to business setup in Dubai in 2025. However, our expert advisors in Dubai offer free online consultations for drafting a tailored business setup plan that meets your needs.
Why Starting a Business in Dubai?
Dubai and the UAE provide a highly conducive and supportive environment for businesses. According to a report from the Emirate News Agency (WAM), in the first three quarters of 2024, over 51,000 new companies were registered by the Dubai Chamber of Commerce. Remarkably, 80% of these newly established businesses are owned by foreign entrepreneurs.
There are numerous reasons why thousands of foreign investors select Dubai as their preferred location for business establishment.
- Low Tax Rate: Dubai boasts a 0% income tax, a low % corporate tax rate of 9%, and a 5% value-added tax for business net profit, which is exciting AED 375,000.
- Good Quality Of Life: The UAE is placed at the 4th position in terms of health and well-being in the 2024 Best Country Index.
- Start-up Support: The UAE has many start-up accelerators and government initiatives designed to support business growth.
- 100% Foreign Business Ownership: Starting a business in Dubai mainland and freezones offers 100% ownership to foreign entrepreneurs.
- Seamless Business Setup: Dubai offers a seamless business setup procedure with less paperwork than in other countries and can be done remotely.
How to Start a Business in Dubai- The Steps to Company Formation in Dubai
Be Clear on What Type of Business You Want to Setup in Dubai:
Before setting up a business in Dubai, it’s crucial to have a crystal-clear vision of your business objectives. Ask yourself these questions:
- What products or services will I offer?
- Who is my target market?
- What makes my business unique?
A solid understanding of your business concept will guide your decisions throughout the setup process and help you choose the most suitable business license in Dubai and the legal structure and jurisdiction for company formation in Dubai.
Draft a Concise Business Plan Outlining Your Legal Structure and Business Activity.
A well-crafted business plan is your roadmap to starting a successful business. Drafting a business plan outlining your legal structure and business activity will be valuable when applying for a company license in Dubai.
It should include:
- Detailed description of your business activities
- Market analysis and competition research
- Marketing and sales strategies
- Chosen legal structure (e.g., LLC, Free Zone Company, or Sole Establishment)
- Preferred jurisdiction (Mainland business setup or one of the many Free Zones)
Apply for a Business License in Dubai
With your business plan in hand, it’s time to apply for a business license in Dubai. Applying for your business license is critical in legitimizing your business operations in Dubai. The process varies depending on your chosen jurisdiction and business activity.
This is where the expertise of a reputable business setup company in Dubai, like Corporate Business Services (CBS), can be invaluable in guiding you through the intricacies of business setup in Dubai and ensuring compliance with local regulations.
Depending on your chosen jurisdiction, you may need to apply to the Department of Economy Development and Tourism (DET) for mainland company formation or a preferred free zone for free zone company formation. This process involves:
- Choosing a trade name that complies with UAE regulations and obtaining a trade name certificate from the DET.
- Submitting required documents to obtain initial approvals from the relevant authorities.
- Leasing an Office Space in Dubai (Not normally required for freezone setup).
- Applying for your trade license in Dubai.
- Signing Memorandum of Association (if applicable)
- Opening a business bank account after receiving your trade license.
- Applying for a residency visa for yourself and your employees.
What Documents are Required to Register a New Business in Dubai?
To setup a company in Dubai, you’ll have to submit specific documents that may vary based on your business type and chosen jurisdiction. Consulting with experts like CBS can help ensure you have all the necessary documents arranged as required.
The most essential documents for company setup in Dubai generally include:
- Passport copies of shareholders and managers
- Business plan.
- 4×4 Passport size photos of all shareholders.
- Memorandum and Articles of Association
- Bank reference letters.
- Proof of address.
Cost of Business Setup in Dubai?
The cost to start a business in Dubai varies widely based on factors such as business type, location, and scale of operations.
The Initial cost of company formation in Dubai typically includes license fees, office space, and visa costs. While setup costs can be significant, many entrepreneurs find the long-term benefits outweigh the initial investment.
Our business setup cost calculator gives you a breakdown of your expenses tailored to your specific requirements and preferences.
How Can CBS Assist You?
Corporate Business Services (CBS), a reputable business consultancy firm in Dubai, offers comprehensive support for entrepreneurs and investors looking to establish their presence in the UAE. Our experienced team can guide you through every process step, from choosing the right business structure to obtaining the necessary licenses and visas.
Book a free consultation with us today to get started.