Why should you invest/start business in Dubai as a foreigner?

As a foreigner investing in Dubai can be very challenging. There are a lot of restriction for foreign investments even now. But, starting and managing a Dubai business can be rewarding.

Dubai’s growing economy presents many opportunities. The services, finance, trade and real estate & properties are paying back profits. Furthermore, the city is one of the most cosmopolitan cities in the Middle East.

Dubai is also a suitable base for starting your business and expanding to the Middle Eastern and North African (MENA) countries.

If you are a foreigner interested in investing and planning to start a business in Dubai, the following will give you a better idea on what to expect.

Why invest in Dubai?

Dubai imposes restrictions for foreigners who wish to start and do business in the city. But, it offers many advantages, such as:

  1. Companies incorporated in Dubai are not subject to corporate tax, withholding tax, VAT, import/export tax and capital gains tax;
  2. UAE has signed more than 66 international double tax avoidance treaties with major countries like China, the USA and most members of the EU;
  3. Foreigners can have easy access to local currency, as there are no exchange controls in place.

Furthermore, foreigners who wish to reallocate to Dubai will enjoy a multicultural environment. Dubai’s population has foreigners from all over the world. So, the city is always up with the latest trends and development. It is also a paradise for any foodie eager to try different cuisines.

Dubai is also a paradise for shopping, since the city does not impose VAT. Residents are exempt from paying personal income tax.

Forming a Dubai company

The first step in forming a company in Dubai is to decide the company type suitable for your business.

Forming a company in one of Dubai’s free zones is most recommended. A Dubai free zone company allows foreign investors to have 100% ownership of the company.

A Dubai limited liability company (Dubai LLC) , limits foreigners to own up to 49% of the company. A UAE national will own the remaining 51% of shares. Only in exceptional cases, The Government authorities permit a 100% foreign owned LLC. Registering your LLC in a free zone will increase the chances of approval.

Free zones in Dubai

There are more than 30 free industrial trade zones specific to each industry in Dubai.

Forming your business in a free zone gives you 100% ownership. The Dubai free zone company also allows you to bring back the revenues and profits to your home country.

Dubai’s free zones also offer the following advantages:

  1. Easy incorporation process;
  2. Fewer restrictions on staff recruitment;
  3. No import and export taxes;
  4. High quality infrastructure facilities;
  5. Find utilities at a low price.

Foreigner investors can either setup LLC or a branch company in a free zone.

Companies with only 1 shareholder can register as a free zone establishment (FZE). Companies with 2 to 5 shareholders can register as a Free Zone Company (FZC).

Not all free zones allow FZEs. Most free zones in Dubai need at least 2 shareholders. Please take note of the specific requirements of each free zone before incorporation.

All Dubai free zones require a minimum paid-up capital. The paid-up capital amount is set according to the free zone and the company structure. The capital amount ranges from US$14 to US$300,000.

A recommended paid-up capital is US$200,000.

Another important point to consider when setting up a free zone company is customers. A free zone company should not to conduct business activities with UAE residents.

If you wish to do business within UAE, then you will have to appoint a service agent. The agent will sell and distribute goods and services under his own name.

Registering your company in Dubai

To register a company in one of Dubai’s free zones, you have to submit the following items to the Dubai Government authorities:

  1. A detailed business plan.
    • The business plan should encompass:
      • Description of the proposed business activity;
      • Quantity and composition of the employees;
      • Amount of investment;
      • Suppliers information and
      • What customers can expect.
  2. A lease agreement and
  3. A receipt of the deposit of the share capital.

Before incorporation, A Dubai company’s corporate bank account should be opened to deposit the required paid-up capital.

The Government authorities will review your company registration application. After the Government’s approval, you should apply for the necessary licenses and permits.

The type of licenses required will vary according to the type of your business activity. After you receive the licenses, the company registration is complete.

It is time for you to start your business in Dubai.

Contact us for help.

Incorporating a company in Dubai as a foreigner is a tedious and requires expertise. At Healy Consultants, we shelter our Clients from inconvenience during the incorporation process. We will manage your engagement with efficiency and professionalism.

Interested in knowing more about starting a company in Dubai? Contact us at (+971) 4550 9345 or send your questions to email@healyconsultants.com.

15 thoughts on “Why should you invest/start business in Dubai as a foreigner?

  1. Hi,

    Really valuable blogs for foreigners who are interested to start a business in Dubai. Thank you for sharing this.

  2. I think that Dubai is a beautiful place and a good place to start a business. This is the reason why I want to start a business there too someday. Thanks for sharing this article.

  3. Yes, I totally agree with what you said. There are a lot of opportunities in Dubai now especially when it comes to business industry. I think that Dubai is a successful country and having a business there is definitely great. Thanks for sharing this article.

  4. I also believe that it is really good to start a business in Dubai. I think that business there is profitable because Dubai is getting popular and a lot of people is visiting it. Thanks for sharing this article.

  5. It is perfect for companies that conduct multiple business activities as JAFZA allows between 7 and 12 activities under a single trading license.

  6. Dear Sir
    One of my Iranian clients wishes to establish a business in Dubai. He wants to know if:
    1- There are any legal restrictions of ownership by Iranians.
    2- He ca open a business account in a bank and
    3- Any restriction in receiving and sending funds via bank accounts.
    Best Regards
    Ali Falsafi

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