Setting up a company in Dubai starts with more than a trade licence. First, define your business activity, choose a legal structure and decide whether to register on the mainland or in a free zone. These choices determine the approvals and documents you will need.
Dubai’s Department of Economy and Tourism (DET) licenses mainland activities within its remit, while each free zone authority licenses businesses in its jurisdiction. Your activity, legal structure and location shape the registration process. Explore DET licensing services.
This guide explains the main steps, cost considerations and requirements to review before you apply.
Business setup advice in Dubai
Why do investors choose Dubai?
Dubai offers a broad range of business activities, licensing options and free zones. Many eligible mainland activities allow up to 100% foreign ownership, subject to exceptions for activities of strategic importance and other regulated sectors.
For many businesses, the former requirement for an Emirati shareholder to own 51% no longer applies. Check the rules for your specific activity and legal structure before committing to a setup. UAE Government: full foreign ownership.
Mainland or free zone: what is the difference?
Your licensing jurisdiction is one of the most important decisions when starting a business in Dubai.
Setting up on the mainland
A mainland company is licensed by the relevant Dubai authorities, including DET for activities within its remit. Its key advantage is access to the local Dubai and UAE market within the scope of its licence and required approvals.
DET provides services for reserving a trade name and issuing, amending, renewing or cancelling a business licence.
Setting up in a free zone
Free zones have their own licensing authorities and rules. The right choice depends on your sector, activities and facilities. Available legal structures may include:
- A free zone company.
- A free zone establishment.
- A limited liability company, under the zone’s rules.
- A branch of a local company.
- A branch of a foreign company.
Not every free zone offers every structure. Confirm availability with the relevant authority before applying.
Can a free zone company operate on Dubai’s mainland?
On 8 October 2025, DET and the Dubai Free Zone Council announced the Free Zone Mainland Operating Permit. It allows eligible free zone companies to carry out specified mainland activities through a regulated permit framework. Read the DET announcement.
A free zone licence does not automatically authorise every mainland activity. Check your activity, regulator and the licence or permit required before trading.
How to set up a company in Dubai
1. Define your business activity
Your activity determines the licence, legal structure, premises and additional approvals you may need. The UAE Government describes a choice of more than 2,000 economic activities. Choose what the business will actually do, rather than relying on its name alone.
2. Choose a legal structure
Common options include a limited liability company (LLC), sole establishment, branch or civil company, depending on the activity and ownership structure. Your choice affects owners’ responsibilities and the incorporation documents required.
3. Reserve a trade name
Choose a name that meets the authority’s rules, reflects the activity and legal structure, and does not conflict with a registered name or public-order requirements. Prepare several alternatives before submitting your reservation.
4. Obtain initial approval
Initial approval indicates that the authority has no preliminary objection to the proposed business. It does not, by itself, authorise you to start operating. Other requirements may still need to be met before the final licence is issued.
5. Prepare the incorporation documents
A Memorandum of Association (MOA) is required for certain legal structures, including LLCs. The documents and formalities depend on the company type.
6. Arrange business premises
Mainland businesses need an address and premises that meet the relevant licensing and local planning requirements. Some Dubai licensing transactions require an appropriately registered or attested tenancy contract.
Free zones offer different office, workspace and flexi-desk arrangements, depending on the authority and package selected.
7. Secure any additional approvals
A standard business licence may not be enough for regulated activities. Healthcare, education, food, tourism, transport, financial services and some specialist professions can require additional approvals. Establish the full requirements before committing to your setup costs.
8. Submit your documents and pay the fees
Once the required documents and approvals are ready, submit the final application and pay the applicable fees. DET and free zone authorities provide digital services for many registration and licensing procedures.
What documents will you need?
The checklist depends on your activity, legal structure, shareholders and jurisdiction. It may include:
- Passport copies for shareholders and managers.
- Identity and residency details, where applicable.
- A trade name reservation.
- Initial approval.
- A Memorandum of Association, where required.
- A premises or tenancy agreement, where required.
- Approvals from the relevant regulators.
The licensing authority may request further documents depending on the investor or company involved.
How much does it cost to set up a company in Dubai?
There is no single fixed price. As an indicative planning range, setup budgets may run from AED 5,000 to AED 50,000, but this is not a fixed quote or a guarantee that every required cost is included. Your actual budget depends on the following factors.
Licence type
Commercial, professional, industrial and other licences can have different requirements and fees.
Business activity
Some activities require extra permits or regulatory approvals.
Mainland or free zone
Each licensing authority has its own fee structure and packages.
Shareholders and company structure
The number and type of shareholders can affect the paperwork and incorporation process.
Office or workspace
Premises can account for a significant share of the overall budget.
Visas
Investor and employee visa numbers, together with establishment requirements, also affect the total.
Compare itemised quotes based on your activity, jurisdiction, visa needs and premises. A headline licence price alone does not show the full cost of starting and maintaining the business.
Can a foreign investor own 100% of a Dubai company?
Yes. Many eligible mainland businesses permit full foreign ownership. Exceptions and special approvals still apply to activities of strategic importance and certain regulated sectors.
Free zones also allow full foreign ownership under their respective rules. Always confirm the requirements for your chosen activity and company structure.
Which taxes should you consider?
Corporate tax
Under the standard UAE corporate tax framework, the rates are generally 0% on taxable income up to AED 375,000 and 9% on the portion above AED 375,000. Special regimes and exceptions may apply. UAE Government: corporate tax.
A free zone address does not automatically make all profits tax-free. A Qualifying Free Zone Person may benefit from 0% on qualifying income, while non-qualifying taxable income is generally subject to 9%, under the applicable conditions.
Value Added Tax (VAT)
For UAE-resident businesses, mandatory VAT registration generally applies when taxable supplies and imports exceed AED 375,000 over the previous 12 months, or are expected to exceed that amount within the next 30 days.
Voluntary registration may be available above AED 187,500 in qualifying taxable supplies, imports or expenses, subject to the registration conditions. FTA: VAT registration.
Which jurisdiction suits your business?
There is no universal answer.
Mainland may suit you if:
Your principal customers are in Dubai’s local market and you need to operate directly in the emirate within the scope of your licence.
A free zone may suit you if:
Your business has an international focus, a zone specialises in your sector, or its facilities and packages match your operating needs.
Base your decision on the activity, target market, budget, premises, visas and tax position, rather than the cheapest advertised licence.
Common mistakes to avoid
Choosing the cheapest licence without checking the activity
A low-cost licence is of little use if it does not cover the work you intend to do.
Selecting a free zone before defining your market
If most customers will be in Dubai, understand how your company can lawfully serve the mainland market.
Overlooking extra approvals
Missing a sector-specific permit can delay your launch.
Ignoring second-year costs
Budget for renewals, premises, visas, accounting and tax obligations, as well as initial registration.
Assuming free zone status always means 0% tax
The tax treatment depends on the business, its income and its compliance with the relevant conditions.
How to choose a business setup adviser
Ask for a clear proposal identifying the registered activity, licence type, issuing authority, legal structure, incorporation fees, office costs, included visas, required approvals and expected renewal costs.
The aim is to establish a business that can operate effectively after registration—not simply to obtain a licence. Speak to our team about your plans.
Frequently asked questions
How long does company setup take?
Timing depends on the activity, jurisdiction and external approvals. The UAE Government’s free zone guidance refers to licence issuance in many cases taking around 14 working days after an application has been reviewed and approved. This is not a guaranteed end-to-end timeline; confirm the schedule with your chosen authority.
Do I need an Emirati shareholder?
Not for many eligible activities. Full foreign ownership is available for numerous mainland businesses, with exceptions for strategic and regulated sectors.
Can I set up without an office?
This depends on the jurisdiction and activity. Mainland businesses must meet the applicable address and premises requirements. Some free zones offer workspace or flexi-desk options within their packages.
Can I start the process from outside the UAE?
Many registration steps can be completed online. However, your activity, shareholders and structure may require document authentication or additional procedures at certain stages.
Which Dubai free zone is best?
The best fit depends on your sector, location preferences, budget, visa needs, customers and facilities. Compare these factors rather than relying on a single general ranking.
Are free zone companies exempt from corporate tax?
Not automatically. A Qualifying Free Zone Person can receive the 0% rate on qualifying income and the 9% rate on non-qualifying taxable income, subject to the applicable rules.
When should I register for VAT?
UAE-resident businesses generally need to register once they meet the AED 375,000 mandatory threshold under the FTA’s rules. Voluntary registration may be available above AED 187,500 when the relevant conditions are met.
What should I do first?
Define the company’s actual business activity. It drives your licence type, legal structure and approvals, so it should come before choosing a package, free zone or office.
Give your Dubai business the right start
A successful setup is about choosing the right activity, structure and licensing authority, and understanding the costs and responsibilities that follow. Compare mainland and free zone options against your business model and target market, then confirm the relevant approvals.
Planning a business in Dubai? Contact Tasyeir for practical guidance on your business setup options.
