Company Registration in the UAE
The United Arab Emirates is the most significant economic center in the Middle East and one of the largest in the entire world. This state offers very favorable conditions for opening and running a business. Due to free economic zones, a low tax burden, and an advantageous geographical location, this country is one of the largest hubs for the most diverse types of business.
However, it is necessary to know the peculiarities and specifics of the legislation to open a company in this country successfully. Otherwise, there is a risk of rejection, leading to time loss. Lawtter Solutions offers clients company registration services in the UAE on the most favorable terms. We provide a fast opening of legal.
3 000 EUR*
7 days
0%, 9%
Without personal visit
Benefits
Advantages of Company Registration in the United Arab Emirates
Opening a company in the UAE has several advantages. These include numerous factors, which we describe below.
Convenient Location
Free Economic Zones
Non-residents Can Also Control Mainland Companies
Attitude Towards Foreign Investors
English Legal System
The Presence of Many Large Banks
There are various organizational and legal forms of companies in the Emirates. The following are the most popular.
Sole Proprietorship
Individual entrepreneurship is a form of small business ownership. It has the most minor registration requirements, but at the same time, there are countless restrictions on conducting activities. The activity of individual entrepreneurs is limited by the marginal profit, the number of personnel that can be hired, etc.
Limited Liability Company
A private limited liability company (LLC) is similar to an LLC. With their share of the authorized capital, all shareholders are responsible only for the company’s obligations. LLCs are a good choice for medium and large businesses.
Public Shareholding Company
A public limited liability company is similar to an LLC. Yet in this case, shares can be distributed without restrictions. Their owners can be not only the founders of a legal entity; shares can be sold publicly.
Limited Partnership
A Limited Partnership is a partnership in which liability is shared between one general partner and limited partners. The general partner bears full responsibility, including personal assets and property. Limited partners are liable only to the extent of their shares.
General Partnership
A general partnership means that all partners are general; they bear unlimited liability for the partnership’s obligations. Accordingly, they can be responsible for obligations involving personal property or assets.
Several requirements must be met to register a company in the UAE quickly and without problems. Here, it is essential to know that they are different for free zones and the rest of the country (Mainland). In general, the requirements are as follows.
Director
There are no residency requirements for a director in the UAE. She/he can be a citizen of any country. It is forbidden to appoint citizens of countries on sanctions lists and individuals under sanctions. The company must have at least one director, and the minimum age is 18.
Shareholder
In Free zones, a shareholder can be a non-resident and own 100% of the company’s shares. If you register a company in the Mainland, you can also own up to 100% of the shares, except for some types of business. For law firms, audit firms, schools, and enterprises connected with the state, the rule remains that a resident of the UAE must own at least 51% of the shares. The minimum number of shareholders is 1; the minimum age is 18.
Company Address
The company must have a legal address in the UAE. If the organization works in the Free Zone, it must have a legal address in the zone where it is registered.
Name of the Company
The organization must have a unique name. Before registration, the name is checked. There are different rules for naming organizations in the Free Zone and the Mainland. On the Mainland, companies have the following endings:
- Limited Liability Company – on LLC;
- Limited Partnership – on Limited Partnership or LP;
- General Partnership – General Partnership or GP.
In the Free Zone, companies have the following endings:
- Free Zone Establishment – on FZE;
- Free Zone Company – on FZC;
- Free Zone Limited Liability Company – FZLLC, FZCO.
Share Capital
There are no minimum authorized capital requirements for companies in the Emirates.
UAE Bank Account
To open a business in the UAE, you do not need to open an account in a local bank. You can work with accounts from any country in the world.
Registration Agent
A registration agent is not required to register a company in the UAE.
Reporting
All companies are required to prepare and submit reports within the specified period.
It is essential to know about the peculiarities of taxation in the Emirates. In particular, the global principle of taxation operates in this country. The profit of resident companies is taxed from worldwide income regardless of the place of service provision, counterparties, and company structure. It is essential to know that the Free Zone and the Mainland tax policy differ.
Income Tax
Tax residents of the UAE must pay an income tax of 9%. For example, if you work in the Free Zone and decide to open a company in Dubai, the income tax rate can be 0%. However, in this Free Zone, companies must meet certain conditions. If the company does not meet them, it must also pay a tax of 9%.
Withholding Tax
The withholding tax rate in the UAE is 0%.
VAT
According to the general rules, the value-added tax in the Emirates is 5%. However, a 0% rate is applied to some product groups.
As for reporting, all companies submit it in the UAE. The following documents must be submitted.
Annual Report
All companies in the UAE submit an annual report. Enterprises’ reporting periods are 12 months. Documents must be submitted no later than nine months after the end of the reporting year.
Audit
According to the UAE Federal Law, all UAE Mainland companies must prepare and submit audited reports to the relevant authorities. Mainland companies must keep all financial documents for five years.
Free Zone companies generally do not undergo a mandatory audit and do not submit an audit report, but there are several specific rules in each zone.
VAT Accounting
Every company must register for VAT upon reaching a turnover of AED 375,000. Voluntary VAT registration is possible upon reaching a turnover of AED 187,500. The VAT report is submitted monthly or quarterly, depending on the company’s turnover. It must be submitted within 28 days of each month following the reporting month.
There are various organizational and legal forms of companies in the Emirates. The following are the most popular.
Sole Proprietorship
Individual entrepreneurship is a form of small business ownership. It has the most minor registration requirements, but at the same time, there are countless restrictions on conducting activities. The activity of individual entrepreneurs is limited by the marginal profit, the number of personnel that can be hired, etc.
Limited Liability Company
A private limited liability company (LLC) is similar to an LLC. With their share of the authorized capital, all shareholders are responsible only for the company’s obligations. LLCs are a good choice for medium and large businesses.
Public Shareholding Company
A public limited liability company is similar to an LLC. Yet in this case, shares can be distributed without restrictions. Their owners can be not only the founders of a legal entity; shares can be sold publicly.
Limited Partnership
A Limited Partnership is a partnership in which liability is shared between one general partner and limited partners. The general partner bears full responsibility, including personal assets and property. Limited partners are liable only to the extent of their shares.
General Partnership
A general partnership means that all partners are general; they bear unlimited liability for the partnership’s obligations. Accordingly, they can be responsible for obligations involving personal property or assets.
Several requirements must be met to register a company in the UAE quickly and without problems. Here, it is essential to know that they are different for free zones and the rest of the country (Mainland). In general, the requirements are as follows.
Director
There are no residency requirements for a director in the UAE. She/he can be a citizen of any country. It is forbidden to appoint citizens of countries on sanctions lists and individuals under sanctions. The company must have at least one director, and the minimum age is 18.
Shareholder
In Free zones, a shareholder can be a non-resident and own 100% of the company’s shares. If you register a company in the Mainland, you can also own up to 100% of the shares, except for some types of business. For law firms, audit firms, schools, and enterprises connected with the state, the rule remains that a resident of the UAE must own at least 51% of the shares. The minimum number of shareholders is 1; the minimum age is 18.
Company Address
The company must have a legal address in the UAE. If the organization works in the Free Zone, it must have a legal address in the zone where it is registered.
Name of the Company
The organization must have a unique name. Before registration, the name is checked. There are different rules for naming organizations in the Free Zone and the Mainland. On the Mainland, companies have the following endings:
- Limited Liability Company – on LLC;
- Limited Partnership – on Limited Partnership or LP;
- General Partnership – General Partnership or GP.
In the Free Zone, companies have the following endings:
- Free Zone Establishment – on FZE;
- Free Zone Company – on FZC;
- Free Zone Limited Liability Company – FZLLC, FZCO.
Share Capital
There are no minimum authorized capital requirements for companies in the Emirates.
UAE Bank Account
To open a business in the UAE, you do not need to open an account in a local bank. You can work with accounts from any country in the world.
Registration Agent
A registration agent is not required to register a company in the UAE.
Reporting
All companies are required to prepare and submit reports within the specified period.
It is essential to know about the peculiarities of taxation in the Emirates. In particular, the global principle of taxation operates in this country. The profit of resident companies is taxed from worldwide income regardless of the place of service provision, counterparties, and company structure. It is essential to know that the Free Zone and the Mainland tax policy differ.
Income Tax
Tax residents of the UAE must pay an income tax of 9%. For example, if you work in the Free Zone and decide to open a company in Dubai, the income tax rate can be 0%. However, in this Free Zone, companies must meet certain conditions. If the company does not meet them, it must also pay a tax of 9%.
Withholding Tax
The withholding tax rate in the UAE is 0%.
VAT
According to the general rules, the value-added tax in the Emirates is 5%. However, a 0% rate is applied to some product groups.
As for reporting, all companies submit it in the UAE. The following documents must be submitted.
Annual Report
All companies in the UAE submit an annual report. Enterprises’ reporting periods are 12 months. Documents must be submitted no later than nine months after the end of the reporting year.
Audit
According to the UAE Federal Law, all UAE Mainland companies must prepare and submit audited reports to the relevant authorities. Mainland companies must keep all financial documents for five years.
Free Zone companies generally do not undergo a mandatory audit and do not submit an audit report, but there are several specific rules in each zone.
VAT Accounting
Every company must register for VAT upon reaching a turnover of AED 375,000. Voluntary VAT registration is possible upon reaching a turnover of AED 187,500. The VAT report is submitted monthly or quarterly, depending on the company’s turnover. It must be submitted within 28 days of each month following the reporting month.
Registration companies
Company Registration Process
The procedure for opening a company in the UAE includes five main stages. They are as follows.
Due Diligence and KYC verification
Name check
Preparation of documents
Submission of documents
Preparation of statutory documents
Documents
Documents Required for Registration
To open a company in the UAE, the owner, director, and shareholders must submit the following documents:
- Identification documents. For example, this could be a passport or ID copy.
- Confirmation of residential address. You can provide a utility bill or bank statement. The document must be no older than three months.