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Faqs

What are the advantages of a business setup in a UAE Free Zone? Why is it attractive to register my company in a Free Zone?
Registering your company in a free zone is attractive for the following reasons:

  1. 100% foreign company ownership
  2. 100% repatriation of capital and profits
  3. Exemption from all import and export duties
  4. No corporate tax
  5. No dividend tax
  6. Abundant and inexpensive energy
  7. Competitive labor costs, skilled labor force and easy recruitment procedures
  8. ’One-stop-shop’ Administration services
  9. On-site customer’s inspection
  10. Companies registered in a Free Zone can operate 24 hours a day

What does a Free Zone Company (UAE) means?
Free Zone is a jurisdiction where a person of any nationality may own 100% of a Company. The company is also exempted from import and export duties and there is 100% repartition of capital and profits. For more details, please contact us.
What are the limitations of registering a company within one of the Free Zones?
Some limitations of registering your company in a Free Zone are:

  1. A Free Zone Company is not allowed to trade directly with the UAE market
  2. The Free Zone Company can trade within the UAE only through the locally appointed distributors
  3. Custom Duty of 5% is applicable for local business
  4. Employees with visas from free zone companies are expected to work only from the company’s offices or other buildings within that free zone

What is the difference between a business setup in a Dubai Free Zone and a Non Free Zone?
A Free Zone license will give you 100% ownership of your company and complete control of your business. Incorporating your business in a Free Zone also tends to be a cheaper and easier process.

An advantage of a Non Free Zone setup, a local DED (Department of Economic Development) Mainland license, is that this type of license allows you to freely operate in any area of the UAE. Even though a local Emirati sponsor who would have 51% ownership of your company, certain businesses simply work better with a Non Free Zone license. In other words, when you have a Free Zone license, you are allowed to operate only within that Free Zone but with a Non Free Zone license, you will not be restricted to one area.

If you are not sure what is the best option for your business, a Free Zone or Non Free Zone, please contact N R DOSHI & PARTNERS to discuss your options. We will provide you with advice on the best area for your proposed business activity, find you a local sponsor, or when a free zone is the most appropriate, we will advise you on which Free Zone is most suitable for your business.

What is the minimum capital requirement for a business setup in a Dubai Free Zone?
The minimum capital requirement to incorporate a company in Free Zone depends on the business activity. There is usually no capital requirement for branch companies.
Can I make amendments in the license in future?
Yes, we can help you with any changes you may require to make such as adding activities, shareholders etc. (subject to approval).
Why cannot I register a company myself?
There are more than 40 Free Trade Zones in the United Arab Emirates, where it is possible to register onshore or offshore companies for almost any type of business activity. In addition, each Free Trade Zone has its own specifics. When you choose a FTZ, it is important to understand the purpose of incorporation in order to foresee any misstep, which may subsequently lead to large financial losses. Besides, a dominant number of different issues related to the company activity (including its renewal) can be solved only by personal visit to the relevant authorities, which can be handled by our Advisors. In addition, even though you can save on professional services of a consulting company, there is a higher risk that you may probably choose not the best option for the company, its license type, permitted activities, the number of visas and different expenses. In this case, eventually, there is a higher probability that you will have to pay significantly more and to deal with some unexpected questions and challenges.
Do I have to come again to renew the company license?
No, you needn’t. Renewal of the company license will be carried out by our Advisors for you.
How many visas/work permits can I obtain with a Free Zone Company?
The number of visas/work permits issued depends on the free zone jurisdiction the Company is registered and the office space which the company has leased.
Can a construction company have office in the free zone?
Construction or any business activity which needs to be operated in the local market are not welcomed by the free zones.
Which document is accepted as Proof of Residence, when the Shareholder/Member is U.A.E. Resident?
UAE Residence visa, ID Card, utilities bill (most recent)
What is the real use of an onshore company in Free Trade Zone of the UAE?
Apart from significant tax optimization, an onshore company in a Free Trade Zone can greatly minimize the cost of production and/or operational control of the operative business in the country. Due to the absence of corporate tax on most types of business activities and no income taxes, minimal deductions related to the payment of wages, the UAE are a very effective place to do business.

In addition to significant tax advantages, the UAE have well-developed infrastructure, cheap energy and a favorable geographical position in the region between the West and the developing East. The Emirates are favored from other countries by progressive and friendly legal framework for doing business.

The uniqueness of onshore companies registered in the UAE Free Zones is that there are no taxes despite the fact that a company can have a real working office and actually be managed in the UAE.

On-shore companies registered in the Free Trade Zones of the United Arab Emirates – is not offshore, but a full resident company with no taxes (except taxes on the oil industry and tourism).

A company that is registered in a Free Trade Zone allows its owner to get a resident visa of the UAE and benefit from the extensive network of double tax treaties available.

What does an Offshore Company mean?
The term offshore refers to the different jurisdictions which offer financial confidentiality and are typically characterized having bank secrecy laws, no tax on profits, revenues, interest, inheritance, capital gains and income. For more details, please contact us.
Would it be possible to open a bank account for an Offshore Company in UAE?
Yes, you can open a corporate bank account in UAE or anywhere in the world*in the name of an Offshore Company. For more details, please contact us. *Local laws applicable.
Can an offshore company have an office in UAE and obtain visa?
No, offshore companies are barred from having an office and obtaining visas.
What activities are not permitted by a UAE Offshore?
Generally a UAE Offshore may not:
No offshore company which is incorporated under these Regulations shall:

  • carry on business with persons resident in the United Arab Emirates;
  • own an interest in real property situate in the United Arab Emirates, other than a lease
  • carry on banking business;
  • carry on business as an insurance or re-insurance company, insurance agent or insurance broker; or
  • carry on any other business which may, by regulations made by the Authority, be prohibited by the Authority.
  • An offshore company shall not be treated as carrying on business with persons resident in the United Arab Emirates.

How can the Shareholder/Member prove the ownership of the UAE Offshore?
UAE Offshore will issue a List of Shareholders or Certificate of Incumbency, which also contains information regarding authorized share capital and names of Directors and Secretary OR Registered Agent will issue Share Certificate and UAE Offshore will attest it).
Can such company lease a real office in UAE?
No. This is the second core limitation on the such company. Is it not allowed to have any real office within UAE. It can have only registered address which is the address of the company registered agent. In case of Dubai offshore company registration over us your company registered address would be our office address: 608, Mankhool Building, Khalid Bin Walid Road P O Box 13742, Dubai, United Arab Emirates
Can Offshore Company have bank account outside of UAE?
Absolutely. The company bank account opening can be done in UAE as well as abroad. If required, we can provide the complete assistance in account opening in UAE as well as abroad. We have a range of different banks. Some of the banks abroad provide the possibility to open bank account without personal visit.
What is the real use of an offshore company?
Registration of an offshore company is a recognized and effective tool for tax planning and asset protection.  Offshore companies in the UAE stand out from other alternative jurisdictions that offer registration of offshore companies.

  1. Registration of an offshore in the UAE gives foreign shareholders
  2.  legal entities and individuals.
  3. 100% ownership with full tax exemption.
  4. There are no requirements for minimum share capital, no restrictions on capital and profits expatriation.

UAE company law and banking regulation offers reliable mode of confidentiality, and a reliable and efficient banking system. The United Arab Emirates, in fact, being a tax-free country, do not fall under the category of “tax heavens” and have never been blacklisted by European countries as an offshore jurisdiction.

Is it required to obtain an employment /residence visa after registering my business in the UAE?
This depends on the Free Zone or Mainland license. In some cases, it is compulsory, in some cases it’s not. However, it is desirable that the General Manager of the company does obtain one. The General Manager is authorised to sign on behalf of the company and is responsible for day-to-day business. It is required for the visa holder to be in Dubai every 180 days (6 months) otherwise the visa will be cancelled. In order to obtain the visa, the person needs to be in the UAE for approximately one week, during which he/she will need to undergo a medical exam.
Obtaining residence permit in the UAE.
One of the most important factors in the further successful development of Dubai is a liberal policy of the state in relation to foreigners, who lives, works, or just visits the country. That is why Dubai has become home to more than 150 nationalities. The local population is currently slightly more than 11%, the rest people are arrived foreigners. At the same time the UAE have created such conditions for life and work that no one feels like a foreigner in this country.
How many visas/work permits can I obtain with a Free Zone Company?
The number of visas/work permits issued depends on the free zone jurisdiction the Company is registered and the office space which the company has leased.
What is the difference between Commercial and Professional License?
Professional license allows professionally qualified individuals (like Doctors, Consultants, Engineers etc…) to perform their area of expertise in Dubai.

A commercial license permits the Companies to carry out commercial activities such as trading, construction, renting etc. in UAE. The contribution of foreign investment in such companies should be limited to 49%.

Can I make amendments in the license in future?
Yes, we can help you with any changes you may require to make such as adding activities, shareholders etc. (subject to approval).
Do I have to come again to renew the company license?
No, you needn’t. Renewal of the company license will be carried out by our Advisors for you.
What is the difference between a business setup in a Dubai Free Zone and a Mainland?
A Free Zone license will give you 100% ownership of your company and complete control of your business. Incorporating your business in a Free Zone also tends to be a cheaper and easier process.

An advantage of a Non Free Zone setup, a local DED (Department of Economic Development) Mainland license, is that this type of license allows you to freely operate in any area of the UAE. Even though a local Emirati sponsor who would have 51% ownership of your company, certain businesses simply work better with a Non Free Zone license. In other words, when you have a Free Zone license, you are allowed to operate only within that Free Zone but with a Non Free Zone license, you will not be restricted to one area.

If you are not sure what is the best option for your business, a Free Zone or Non Free Zone, please contact N R DOSHI & PARTNERS to discuss your options. We will provide you with advice on the best area for your proposed business activity, find you a local sponsor, or when a free zone is the most appropriate, we will advise you on which Free Zone is most suitable for your business.

Which are the most commonly used banks for Free Zone Companies in the UAE?
Emirates NBD, Noor Bank, Mashreq and ADIB.
Can I open a bank account for my new business started in UAE?
Yes, upon establishment of your new business we can assist you in opening of a bank account with international & local banks as per your requirements.
Can Offshore Company have bank account outside of UAE?
Absolutely. The company bank account opening can be done in UAE as well as abroad. If required, we can provide the complete assistance in account opening in UAE as well as abroad. We have a range of different banks. Some of the banks abroad provide the possibility to open bank account without personal visit.
How to open a bank account in the UAE?
Given the fact that each bank is unique – different sets of services – from classical retail to full corporate or private banking, different documentation requirements and minimum balance, different tariffs, specialization in certain sectors or countries, etc., correct choice of bank is the key to continued success of cooperation with it. Taking into consideration the specificity of each bank, it becomes noticeable that opening a bank account abroad is an important step in the structuring of foreign business and tax planning. It requires serious analysis and approach in each case, as well as proper preparation of all necessary documents for the bank.

Basing on your preferences (reliability and prestige, the bank’s rating, a set of services provided by the bank, the minimum deposit required, the costs of banking services, etc.), our Advisors will provide you with a choice of reliable banks in stable and economically developed countries, following a strict privacy policy. They will make all the necessary steps to open accounts in the UAE and will prepare the necessary documents for you. At the same time, if necessary, they will give you an opportunity to open an account without visiting the bank. You can familiarize with the basic set of documents for opening a bank account here (link).

Is it possible to open a branch office of a local company (UAE) in any other Emirate or same Emirate?
Yes, office with same/similar type of activity can be opened in other Emirate or the same Emirate but different location as a branch. The activities in the license are subject to the approval from the Economic Development Office. For applying for setting up of a branch the incorporation documents of the parent company will be required.
What are the real business advantages of the UAE, including logistics, manufacturing etc.?
When opening a new operational business in the UAE, you can greatly minimize the costs of production and/or operational control of the business. Since there is no corporate tax on most types of activities and no income tax, absolutely little deductions related to the payment of wages, the UAE is a very effective place to do business.

Along with significant tax advantages, the UAE has an extensive logistic infrastructure and cheap energy. It also has a fortunate geographical position in the region and can be favorably compared with progressive and friendly legal framework for doing business.

What are the advantages of the UAE compared to other jurisdictions?
Classic offshore companies cannot be managed from the territory they are registered at (otherwise, as a rule, taxation will be applied in the country of its registration). That is why classic offshore companies can often define residence not by the country of its registration, but by country, where the company is actually controlled from.  This fact usually entails significant tax risks in relations with tax authorities in different countries. In case of registration of a company in the UAE, these risks are not applicable. If the business processes are properly structured, the company can prove its residency in the UAE without any tax complications due to the absence of taxation in this country.

The question of the actual residence of companies has recently become particularly acute. Business relationships with offshore companies have become very complex. This situation is getting even more complicated in recent months. Companies in the UAE efficiently solve this problem.

Companies in the UAE Free Trade Zones are more expensive than ones in classic offshore jurisdictions. However, the absence of taxes, stability and recognition of this jurisdiction by other countries, effective banking services and availability of Double Tax Treaties outweigh the costs difference.

Onshore companies registered in the Free Trade Zones of the United Arab Emirates are not considered offshore, but a full resident company, with no tax (except taxes on the oil industry and tourism).  Unlike classic offshore companies, where any financial flows result in high attention from bank supervisory authorities, companies that are registered in the UAE, usually do not draw in any concern from authorities.

In addition to the above:

  1. The presence in the UAE may open new opportunities for new work within the GCC region.
  2. Ability to transfer part of the production chain to the Free Zones without any taxes and cheap labor forces.
  3. Powerful UAE logistic infrastructure can be effectively used when working with international markets.

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