Benefits of setting up business in UAE

  1. Complete repatriation of profits

Foreign companies are subject to restrictions in many nations, and they are required to keep a portion of their capital and revenues inside the country where they are operating. But in Dubai, there isn’t any such requirement. All businesses kinds are permitted to repatriate their cash and revenues in full to their home countries in Dubai’s mainland and in any of the city’s free zones.
Common foreign direct investment regulations limit foreign company investment to up to 49% of the business while allowing local partners to hold 51% of the shares. Foreign business owners can benefit from 100% business ownership under several company formations in the UAE.

  1. Small Business Incentives

The Dubai government supports small and medium-sized businesses in addition to offering amenities to major investors. The government occasionally announces incentives for different kinds of enterprises to help them. The Khalifa Fund for Enterprise Development was established in 2007 by the President of the United Arab Emirates and Ruler of Abu Dhabi to assist and promote small- and medium-sized ventures in the Emirate.

For already-established enterprises, they provide advice on company type, mode, and category licensing, lowering startup expenses, and gaining access to discounted rates for commercial real estate. All Dubai government departments must devote at least 5% of their yearly purchasing budget to purchasing from UAE citizens who own and operate small and medium-sized businesses through a government procurement program run by Dubai SMEs. The ability of small and medium-sized firms to compete with larger corporations and market their goods and services to government agencies is boosted as a result.

  1. Low Investments Required

Theoretically speaking, if you want to establish a business in the UAE with 100,000 AED, you should anticipate spending roughly 60,000 AED of that sum on setting up your organization. As a result, look for initiatives that can be sustained with operational costs of 40,000 AED or less. Even if your company does break even or turn a profit in the first year, you will still need to reinvest a certain amount in the next year to ensure your existence.

  1. Tax exemptions

Income tax is zero in the UAE. UAE recently reintroduced VAT in 2018. It is an indirect tax, though, and companies typically pass it on to customers. Businesses can also claim VAT refunds for incurred business expenses when filing their returns. Only foreign banks and energy firms are subject to corporate taxes in the UAE. Other industries have not yet been subject to corporate taxation. As of right now, corporations registered in free zones are not subject to corporate tax.

The Emirates provides a variety of tax categories and corporate ownership structures. One among them stands out to be the free zones with the feature of 100% tax exemptions. This implies that you are exempt from paying income or business taxes to the government and can keep all of your business profits.

  1. Strategic Locations

It is the ideal commerce hub due to its strategic location and easy access to the Arabian Gulf. UAE is advantageously situated in the middle of three continents: Asia, Europe, and Africa. Additionally, the nation offers simple access to the markets in the Middle East.

Due to its advantageous location, the UAE is a great place to establish a trading or import/export company. On the one hand, China and India are important trading partners and sources of raw materials. The European Union, which is a significant trading partner, is on the opposite side of the UAE.

  1. Flexible Options for Starting a Business

In several free zones in the UAE, you are able to establish a business licence without the need for a physical office. They give licence holders access to smart/flexible offices. The quantity of visas that can be issued is yet constrained by this. If you want to be a solopreneur and run the firm by yourself, this shouldn’t be a problem.

In the UAE, operating a home-based business is not against the law; in fact, it is rather popular right now. However, it is crucial to register your company and obtain a business licence. The Dubai Economic Department’s (DED) “Trader licence” aims to incorporate new businesses and activities that operate online or on social networking sites into the database of the economic department.

  1. Full Business Ownership

Under mainland UAE FDI regulations, foreigners and expatriates are only permitted to own up to 49% of a company. A local partner must hold the remaining 51%. Don’t be alarmed by this; mainland businesses can register as LLCs, which are flexible and allow for various profit-sharing plans.

The UAE also offers a number of exclusive special zones known as “Free Zones,” where foreigners may own 100% of the businesses established there. Along with 100% ownership, your company will also enjoy the following benefits: 100% exemption from import and export taxes, 100% capital and revenue returns, and 0% establishment and personal taxes. Depending on the Free Zone and the industry, businesses in these zones also enjoy a variety of advantages.

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    It is crucial to comprehend the distinction between obtaining a license with a visa quota and acquiring residency in the UAE. A license with a visa quota solely covers the expenses related to a business license and visa quota, with the possibility of including a Flexi office lease in certain Freezones. However, possessing a visa quota does not automatically grant you UAE residency; additional steps must be completed. If you wish to apply for a partner/investor visa, there are supplementary costs involved. These include obtaining an immigration card, registering for E-channel (NE Only), and paying fees for visa, visa processing, medical examination and Emirates ID typing. To effectively plan your business expenses, it is imperative to ask the right questions from the beginning to avoid surprises and hidden costs.