Starting a business in the UAE offers entrepreneurs access to a strategic location, tax benefits, and a business-friendly environment. This guide outlines the key steps and considerations for establishing your company in 2025.
Choosing Your Business Location
Your first decision is where to establish your business:
Mainland
Trade directly with the local UAE market and internationally
Operate anywhere in the UAE without restrictions
100% foreign ownership now possible in most sectors (due to recent ownership law changes)
Higher setup and maintenance costs
Free Zone
100% foreign ownership
Potential 0% corporate tax rate on "qualifying income" (profits outside free zones taxed at 9% for amounts above AED 375,000)
Cannot trade directly with the UAE local market without a local distributor
Ideal for exports or online businesses
Important Update for 2025: Dubai has issued Executive Council Resolution No. (11) of 2025, allowing free zone companies to expand into mainland Dubai by obtaining a license from the Dubai Department of Economy and Tourism (DET). This landmark development offers unprecedented operational flexibility for free zone businesses.
Step-by-Step Process
1. Identify Your Business Activity
Choose from over 2,000 economic activities available in the UAE
Your activity determines the type of license required
2. Choose Your Legal Structure
Limited Liability Company (LLC)
Free Zone Company (FZC)
Branch of a Foreign Company
Representative Office
3. Reserve a Trade Name
Must be unique and comply with UAE naming regulations
4. Obtain Initial Approvals
Secure approvals from relevant authorities based on your business activity
5. Secure Office Space
Mainland businesses require physical office space
Free zones offer flexible options including virtual offices
6. Apply for a Trade License
Commercial, industrial, or professional license depending on your activity
Submit all required documentation
7. Open a Corporate Bank Account
Required to operate legally
Prepare trade license and shareholder details
Documentation Requirements
Completed application forms
Passport copies of all shareholders and directors
Business plan
Proof of address
Trade name reservation certificate
Initial approval documents
Office lease agreement
Registration Timeframes
Through Basher online platform: As little as 15 minutes (for eligible businesses)
Through Department of Economic Development: Approximately 4 days
Standard process: Typically 3-5 working days for straightforward company types
Corporate Tax Considerations for 2025
As of 2025, businesses should be aware of corporate tax obligations:
Standard rate: 9% on taxable income exceeding AED 375,000
Registration deadlines vary based on incorporation date
Natural persons (individuals) conducting business must register if annual turnover exceeds AED 1 million
Free zone companies may enjoy 0% tax rate on qualifying income
Banking and Financial Setup
After registration, you'll need to:
Open a corporate bank account
Register for Value Added Tax (VAT) if applicable
Set up accounting systems compliant with UAE regulations
Starting a business in the UAE in 2025 offers significant opportunities with streamlined processes. Whether choosing a mainland or free zone setup, understanding the regulatory landscape and recent changes will help ensure a successful launch.