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Setting Up a Company in Dubai

Setting up in Dubai is a sequence of choices, and only two of them are genuinely hard: the jurisdiction and the activity you license. Everything downstream follows from those two — visa quota, office requirement, banking, whether you can invoice a mainland client. On tax the headline is simple: a UAE company pays 0% corporate tax on its first AED 375,000 of annual profit and 9% above that, and registers for VAT once taxable supplies pass AED 375,000.

This section compares the options without selling any of them. You will find free zone comparisons with the figures side by side, IFZA against Meydan and free zone against mainland, what a company really costs in year one and again in year two when the introductory discounts stop, which fees the quoted packages leave out, and the rules that decide whether a free zone company may sell into the mainland at all.

The mistake that costs the most is not overpaying. It is picking the cheapest licence and discovering later that it does not cover the activity you actually bill for, or that the zone's visa quota caps your hiring. Amending an activity or migrating jurisdiction after the fact costs more than choosing correctly the first time, and it costs time you will want for selling.

If you are still comparing zones, start with the cost-of-running guide rather than the setup-cost guide: year two is where the real budget lives. Once the company exists, the obligations that follow are in Accounting, and the visa it entitles you to is in Immigration.

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Frequently asked questions

Free zone or mainland?

Free zone if your clients are outside the UAE or inside free zones, and you want the 0% corporate tax regime to be available. Mainland if you need to sell directly to UAE customers and government. The answer is driven by who pays your invoices, not by the licence price, and a free zone company can reach mainland customers in specific ways set out in our mainland access guide.

What does a company in Dubai really cost per year?

Year one and year two differ, which is where most budgets break: introductory licence discounts, one-off registration and visa costs, and establishment card fees do not repeat the same way at renewal. Our cost-of-running guide separates the two years line by line in AED. Treat any single quoted "all-in" figure as a starting point, not a budget.

Can a free zone company invoice a mainland client?

Not freely. There are defined routes — a dual licence or branch permit from the relevant authority, or going through a mainland distributor — and each has conditions. Invoicing mainland customers without the right permission puts the licence at risk, which is why this is worth checking before you sign the client, not after.

Does my licence cover what I actually do?

Only the activities listed on it. This is the single most common and most expensive setup error: the licence is bought on price, the business then bills for something adjacent, and the mismatch surfaces at bank onboarding or at renewal. Amending an activity later costs more than listing it correctly at incorporation.