Setting Up a Business in the UAE

The UAE welcomes foreign business owners, with 100 percent foreign ownership allowed for most activities, no personal income tax and a large regional market. The choice of structure, licence and location shapes your costs, visas and where you can trade. This guide walks through the options and the steps, with 2026 cost ranges. Fees change often and vary by authority, so confirm them with the licensing body, such as the Dubai Department of Economy and Tourism or the Abu Dhabi Department of Economic Development.

Mainland, free zone or offshore?

	Mainland	Free zone	Offshore
Licensing body	Emirate economic department (DET, ADDED, SEDD and others)	The free zone authority	Offshore registrar (for example RAK ICC or JAFZA)
Foreign ownership	100 percent for most activities	100 percent	100 percent
Trade inside the UAE	Anywhere in the UAE and government contracts	Within the zone and abroad, with extra steps to trade on the mainland	Not allowed to trade locally
Physical office	Usually required (Ejari tenancy contract)	Flexi desk, shared or full office	None required
Residence visas	Yes, based on office size	Yes, based on package	No
Best for	Retail, restaurants, contracting, consulting for local clients	Trading, tech, media, services, holding companies	Holding assets and international deals

Mainland

A mainland licence lets you trade directly with customers anywhere in the UAE, open shops and bid for government work. Since reforms in 2021, most activities no longer need a local sponsor, although some strategic sectors have special rules. You must usually lease a suitable office and register the tenancy (called Ejari in Dubai).

Free zone

Free zones are special areas with their own regulations, offering 100 percent ownership and fast setup. There are dozens across the UAE. Companies can usually trade freely inside the zone and export abroad. Selling to mainland customers normally needs a distributor, a second licence, or a permit under rules introduced by some emirates, such as Dubai, so check before you sign.

Offshore

Offshore companies, registered in places such as Ras Al Khaimah or Ajman, are used for holding assets, owning property and international trade. They cannot trade inside the UAE, do not need a physical office and do not carry residence visas. Banks may ask more questions about the purpose of the company.

Legal forms

• Limited liability company (LLC): the standard mainland form, with one or more shareholders and limited liability.
• Sole establishment: one individual owner with unlimited personal liability. It is simple and cheap, and suits trades and services.
• Civil company: for professional services, such as consultants and lawyers.
• FZE: a free zone establishment with a single shareholder.
• FZCO: a free zone company with two or more shareholders.
• FZ-LLC: a free zone LLC, used in some zones.
• Branch: an extension of a foreign company, without its own legal entity. The parent is liable.
• Representative office: lets a foreign company promote its business but not trade.

The licence process, step by step

1. Choose your activity. Each licence is tied to one or more activities. A trading, professional, industrial or tourism licence differs in cost and approvals.
2. Pick a location and structure. Decide between mainland and a free zone, and choose your legal form.
3. Reserve a trade name. Names must follow rules on language, religion and misleading terms.
4. Get initial approval. The authority checks the activity and name, and some activities need approvals from other bodies, such as health, municipality or Civil Defence.
5. Sign the company documents. For an LLC, this is the memorandum of association.
6. Secure premises. Lease an office or flexi desk and register it.
7. Pay fees and receive the licence. You then get an establishment card and an immigration file, which are needed to sponsor visas.
8. Apply for visas and open a bank account.
9. Register for VAT and corporate tax with the Federal Tax Authority where required.

Using a registered formation agent can save time, but ask for a written breakdown of all government and service fees, and check that the agent is licensed.

What it costs in 2026

These are indicative first-year ranges, which depend on the zone, the activity and the office:

Route	Typical first-year cost
Free zone company with flexi desk, no visas	AED 12,000 to AED 25,000
Free zone company with office and a few visas	AED 25,000 to AED 60,000
Dubai or Abu Dhabi mainland company with office	AED 20,000 to AED 60,000 and above
Offshore company	AED 8,000 to AED 15,000
Freelance permit	AED 7,500 to AED 20,000, depending on the zone and visa

Add the cost of visas, medical tests, Emirates ID, health insurance, an accountant and any security deposit. Dubai and Abu Dhabi mainland costs rise with office rent. Smaller emirates, such as Ras Al Khaimah, Ajman and Sharjah, are often cheaper.

Visas, offices and Ejari

The number of visas you can hold depends on your licence and premises. In free zones, packages usually set a number of visas, which can grow with a larger office. On the mainland, visa quotas generally follow the size of the registered office. Visas for owners, partners and employees each carry government fees, typically a few thousand dirhams per person. See our visas and residency guide for the available categories, including Golden Visa options for investors and entrepreneurs.

An Ejari is a registered tenancy contract in Dubai. It proves your business address and is required for mainland licences. A flexi desk is a low-cost shared workspace that satisfies the office requirement for many free zone licences. Some mainland activities also accept a flexi or shared arrangement, but others such as retail, warehouses and restaurants need real premises that meet safety and municipality rules.

Popular free zones by sector

Sector	Examples
Trading and commodities	DMCC, JAFZA, DAFZA
Logistics and aviation	Dubai South, JAFZA, KEZAD
Finance and fintech	DIFC (Dubai) and ADGM (Abu Dhabi), both with common-law courts
Technology and startups	Dubai Internet City, Dubai Silicon Oasis, Hub71, Masdar City
Media and content	Dubai Media City, twofour54, Sharjah Media City
Healthcare	Dubai Healthcare City
General and low-cost licences	IFZA, Meydan Free Zone, RAKEZ, Ajman Free Zone, Sharjah Publishing City

The right zone depends on your sector, customers and budget. DIFC and ADGM are regulated financial centres with their own rules, and companies in them are supervised by financial regulators.

Opening a corporate bank account

Opening a business account can take longer than getting the licence. Banks verify the owners, the source of funds and the real activity of the company, and some applicants are declined. To improve your chances:

• Prepare a clear business plan, contracts or invoices, and proof of premises.
• Be consistent about what the company does and who your customers are.
• Provide personal bank statements and residence documents for the owners.
• Consider digital business banks, which can be faster, as well as traditional banks.

Allow several weeks. Do not pay anyone who promises a guaranteed account.

VAT and corporate tax registration

Register for VAT if your taxable supplies exceed AED 375,000 a year, or voluntarily if they exceed AED 187,500. All companies, including free zone companies, must register for corporate tax with the FTA through its online portal, even if they will pay 0 percent. Corporate tax is 9 percent on profits above AED 375,000, and qualifying free zone companies can enjoy 0 percent on qualifying income if they meet the conditions. Late registration can attract penalties, so register once you have a licence, and keep proper accounts. Use our VAT calculator and corporate tax estimator, and read banking, money and tax for the wider picture.

Emiratisation and Nafis

Private companies on the mainland with 50 or more employees must raise the share of skilled Emirati employees by a set percentage each year, with a target of 10 percent by the end of 2026. Smaller mainland firms in certain sectors have been required to hire Emirati staff as well. The Ministry of Human Resources and Emiratisation (MOHRE) monitors compliance, and employers who fall short pay a financial contribution. Employers register on the Nafis programme, which supports Emiratis working in the private sector. Free zone companies are generally outside the federal mainland quotas, but some zones set their own requirements. Check with MOHRE and the Nafis platform.

Freelancers and online sellers

• Freelance permits are offered by zones and authorities that focus on creative, media, tech and consulting work, such as those in Dubai, Abu Dhabi and Sharjah. Some include a residence visa and a place to work.
• E-trader licences are designed for people selling goods through social media or a website. They cost far less than a full licence and often do not need an office, although they are limited to online sales.

Choose the permit that matches how you will invoice customers and whether you need a residence visa.

Timelines

• Free zone licence: often 3 to 10 working days from application to licence.
• Mainland licence: usually 1 to 4 weeks, longer when activities need external approvals.
• Visas and Emirates ID: about 1 to 3 weeks after the licence.
• Corporate bank account: 2 to 8 weeks, sometimes longer.

Frequently asked questions

Can a foreigner own 100 percent of a UAE company?

Yes. Free zones have always allowed it, and most mainland activities now do too. A few strategic sectors still have special rules.

Do I need to live in the UAE to own a company?

You can own a company without being a resident, but you need a residence visa to live and work here. Your licence type controls how many visas you can sponsor.

Which is cheaper, mainland or free zone?

Free zones are usually cheaper to start, especially with a flexi desk. Mainland costs more but gives direct access to local customers and government contracts.

Do free zone companies pay corporate tax?

All companies register, but qualifying free zone companies can pay 0 percent on qualifying income, while other income is taxed at 9 percent.

Do I need an Emirati partner?

For most activities, no. Check your activity with the licensing authority.