Ever wondered how it would be to start your own business in the UAE? The UAE has become a dream destination for starting up businesses for expatriates. We have broken down the process of starting a business in the UAE into five (5) simple steps.
Step 1: Plan your business model
A business model is a blueprint of your establishment that helps your business to navigate and conquer the specific market segment that you have focused on. The primary components of any successful business model are the identification of the products or services that you intend to sell or provide, the identification of the target market and the sources of financing and budget to execute the same.
Step 2: Find the right jurisdiction
Once you have the business model ready, choosing an ideal location to start your business is the most crucial part of the business setup process. The place of operation and activities of your business should answer the question of which location or jurisdiction you can choose. You can opt one of the three (3) jurisdictions in the UAE:
Mainland: This includes any territory inside the UAE which is not considered as a free zone. Recent amendments in the UAE company laws ensure that 100% foreign ownership of a business is allowed except for certain business activities. A mainland company can operate its business throughout the UAE.
Free zone: These are certain territories spread throughout the seven (7) emirates which has its own special tax, customs and import structure offering expatriates 100% foreign ownership of the businesses.
Offshore: Essentially the one to choose if you are looking to carry out the business activity outside the UAE and enjoy attractive tax advantages with no office space requirements.
Step 3: Complete your documentation
Documents required to set up your company vary from one jurisdiction to the other. The most common documents that are required for all three (3) of mainland, free zone and offshore companies include a copy of the business plan and, the identification documents of the shareholders and directors such as the copies of their passports and the proof of their residential addresses. Additional documents and a simple KYC check may also be required depending upon the relevant jurisdiction that you choose to incorporate your company with.
Step 4: Registration
All the required documents are submitted to the relevant authority along with the memorandum of association and articles of association signed by the shareholders. The trade license of the business or the certificate of incorporation is issued by the relevant authority after they conduct an independent compliance check.
Step 5: Bank account and Residency visa
The final step would be to open a business bank account in the name of your company to receive payments. The banks typically enquire details such as the business plan, details of the primary customers and suppliers and the expected deposits. There are various options for opening a bank account in the UAE including banks such as Emirates NBD, Mashreq, RAK Bank and Emirates Islamic.
The issuance of a UAE residency visa depends upon the jurisdiction where you have incorporated your company. For mainland companies, there is no limit on the number of visas that a company can issue based on its requirements while a free zone company have limitations depending on the type of licence obtained for the business. No UAE residence visas can be obtained for offshore companies.
While the above highlights the five (5) basic steps that you need to take to start your business in the UAE, the actual process may vary from one company to the other. The entire process can at times seem a bit challenging to complete without professional help. InZone specializes in company formation and business set-ups throughout the UAE with the most competitive prices. You may contact us for any further questions about your proposed business set-up.