Company formation in UAE (Free-Zones)

The most popular company form in UAE Free zones is the Free Zone Company (FZC)

9%

is the corporate tax rate in Free Zones on Taxable Income that is not Qualifying Income

5%

VAT tax. Some Free Zones have the status of designated zones. Supplies made inside or outside the designated zone are not subject to VAT (with some exceptions)

0%

tax on dividends paid to shareholders

Step by Step Description

Step 1. Initial Setup:

  • Initiating a preliminary project assessment
  • Preparation and filing of the package of documents
  • Select a free zone according to a business activities and business model o future company
  • Select a legal structure

Step 2. Company registration:

  • Verification and reservation of the company name
  • Trademark registration (optional)
  • Applying for initial approval
  • Obtaining additional government approvals
  • Facilitating the notarial process for the company's official registration
  • Incorporating the company's data into the register
  • Obtaining the Certificate of incorporation issued by the local registrar, Memorandum and Articles of Association

License obtaining:

Each free zone has different types of licenses, for example: Fujairah Creative City can issue a license for Video Games Wholesale Trading, which distinguishes it from most of the zones we know that do issue such licenses.

When a company is approved for the Free Trade Zone, it is given licenses by the specific Free Zone Authority.

A license may include more than one type of activity.

General requirements for a Free Zone company

Requirements for a Free Zone company depends on the specific Free Zone (e. g. DMCC, Meydan, SHAMS etc.). The regulatory authority of each Free Zone can provide it`s own regulations in these zones.

UAE Free Zones offer 100% foreign ownership of the company. Moreover, in most of the Free Zones absent requirements for minimum share capital and fixed number of shareholders. At the same time, some of Free Zones set minimum share capital requirements. For example Dubai silicon Oasis (100,000 AED), International Humanitarian City (50,000 AED), Fujairah Free Zone (150,000 AED).

According to the general rules Free Zone company should have shareholders in a diapason from 1 to 50.

In addition, Free Zone companies are not required to have a physical office in the Free Zone, and they can take advantage of solutions such as virtual office, Flexi-desk.

As in a Mainland, Free Zone companies should obtain a license (trade, professional, service, industry) for providing their business activities. These licenses are issued by the regulators of specific Free Zones.

Document requirements:

Taxation in UAE Free Zones:

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