How to Start a Business in a Dubai Free Zone?
Starting a business in a free zone in the UAE is one of the most profitable decisions you can make as an Indian entrepreneur. The UAE has transformed itself from a predominantly oil and gas-based nation to a country with many sectors - Tourism, IT, Consultancy, Hospitality, and so on.
It has everything you need for a successful business - high-end infrastructure, seamless connectivity to other parts of the world, a skilled workforce, a favourable tax regime, supportive import-export regimes, and more. And the best part? UAE boasts 45 free zones that give you these benefits with a few more.
So if you want to start a business in a free zone in the UAE, continue reading. This blog will walk you through everything there is to learn about starting a business in a free zone - benefits, documentation, cost, and process.
What Are the Benefits of Starting a Business in a Free Zone?
UAE offers 40+ multidisciplinary free zones for carrying out different activities. These areas stand out for their highly effective infrastructure and unique offerings that support efficient workflows and save organisations a great deal of time and effort.
Besides this, there are a few other benefits that you can reap by starting a business in a free zone. The following are some of them:
- Speedy company setup process
- Fully developed business communities
- Several options at competitive price
- Complete foreign ownership
- 100% capital and profit repatriation
- Total exemption from corporate and income taxes
- Easy access to regional and global markets
- Modern, sophisticated infrastructure with the latest technology
- Supportive government policies
- Exceptionally skilled labour
What Documents Do You Require to Set Up a Business in a Free Zone?
You cannot start a business in a free zone without submitting relevant documents to the authorities. Although the documents differ from activity to activity, some documents are standard. The following are some of them:
- Passport size photos
- Passport copies of all stakeholders
- Copies of entry visa or stamp page
Note.: UAE Expansion India branch professionals can provide you with the complete list of documents that you will have to submit to the respective free zone authority for starting a business in a free zone. You must ensure that these documents are valid and authentic.
How to Set Up a Business in a Free Zone?
Although starting a business is simple, it's always better to completely understand what you should and should not do. This ensures that there is no mishappening in the process which can affect your dream of starting a business in the UAE.
Some business activities require additional permits. Furthermore, they may have a more extensive process than other activities. However, to give you a general idea, here are the key steps to set up a business in a free zone.
1. Determine the Legal Entity
Free zones company setup allows only for limited types of legal structures. As an entrepreneur or a business owner, you can choose any one of the following legal structures:
- Free Zone Limited Liability Company (FZ LLC) or Free Zone Company (FZ Co.)
- Free Zone Establishment (FZE)
The primary difference in these legal structures concerns the number of stakeholders and the nature of the stakeholder (natural person or a legal person). Furthermore, not all free zones allow you to set up all types of companies. Thus, it is best to check with the concerned free zone. In addition to the structures mentioned above, you can establish a branch of your existing local or foreign company.
Professional consultants can help you understand these structures better and help you make a wise decisions.2. Select Your Trading Name
First and foremost, your trading name must be chosen with great care. For starters, it should reflect the activity you want to carry out. Also, you must avoid choosing ambiguous or vague names. But that's not all. There are other rules for naming a company. Your chosen name must comply with them and should be available for registration. For this, you can check with the respective free zone authority.
3. Apply for a Business License
The UAE allows you to carry out several activities. Some are advertising, software development consultancy, construction, graphic design, branding, public relations, and more. The list is endless. Based on these activities, there are several licenses - commercial, consultancy, manufacturing, industrial and others. Your company's main activity will determine the sort of business license you should apply for. Furthermore, the license application must be submitted to the respective free zone authorities.
4. Choose an Office Space
Most businesses will need a physical space to operate and carry out their activities. In the free zones, you may either purchase or rent office space. Your office needs will depend on several factors like your company's size, industry, and kind of operation. You may opt for a Flexi desk, a Flexi office, office suites, and more. Some free zones also offer packages like 'Smart Desk Office Packages' and 'Executive Office Packages.' So choose a suitable space as per your needs.
5. Pre-Approvals And Registration
The regulations of each free zone apply to businesses that have been formed there. You must apply with the required paperwork to receive the necessary permissions. Some companies may need to get pre-approval and extra permits.
Only once you get your pre-approvals cleared can you go ahead and pay the fees. Moreover, in the case of physical offices, you will also have to enter into a contract. Once you get your license, you can hire employees, get the necessary machines, and start your business.
What Is the Cost of Setting Up a Business in a Free Zone?
The total cost of starting a business includes several other costs like registration fees, free zone license costs, visas, office space, and more. Furthermore, the prices differ from activity to activity.
The total cost also depends on the free zone you choose. For instance, the required share capital to establish a free zone company in DMCC is AED 50,000 for the firm and AED 10,000 for each shareholder. Similarly, you can establish an FZCo. in the Dubai Airport Free Zone with a minimum share capital of AED 1000. Thus, giving you the exact Dubai free zone license cost or any other free zone license cost is tricky.
Experts can help you with the exact cost of starting a business after considering all the necessary factors. They'll also ensure that you do not overspend
Here are the key steps to free zone company formation in Dubai.
- Determine the type of legal entity.
- Choose a trade name.
- Apply for a business license.
- Choose an office space.
- Get pre-approvals, register your business, and get your license.
Start Your Business in a Free Zone With UAE Expansion
UAE Expansion India branch professionals can bring your dream of setting up a business in a free zone to life. We will look after all documentation and approvals, ensuring you have everything you need. Furthermore, we will ensure that your documents are valid and that you do not overspend on the licenses. Our experts are well-versed in the business setup process and will assist you in making the right decision. All you need to do is get in touch with us!