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Step-by-Step Process to Obtain a Business license in UAE.

There are many reasons why starting a business in UAE presents an exciting opportunity. With a strong economy, favorable business laws, and international opportunities, UAE is a favourite place for entrepreneurs and investors. 

Before you can begin trading, you will need to obtain the appropriate business license in UAE. This process applies to every business, whether you are planning a business setup in dubai or company formation in abu dhabi, the process remains similar 

In this blog, we will take you through the step-by-step process to legally and easily obtain a UAE business license.

Table of Contents

Introduction

When launching a legal entity in the UAE, obtaining your business license is the first hurdle you need to reach before everything else is possible. It is how you will legally operate, open a bank account, hire employees, and sign contracts. 

You must understand each step and prepare all documents beforehand, and then the process is very easy.

Watch our short video on Instagram to see how to get your business license in UAE step-by-step — visually explained!

Step 1 – Identify the Composition of Business License

The first step is to determine which license type is correct for your business. 

There are essentially four main types of business licenses in UAE.

  • Commercial License- Trading, import or export, or retail business.
  • Professional License- service, consulting or skilled based work. 
  • Industrial License- for manufacturing, or production
  • Freelance or e-commerce License- for individuals operating online, or freelance businesses.

Each license type comes with its own legal requirements, fees, and trades. Choosing correctly now, will prevent any issues regarding compliance in the future.

 

Step 2 – Determine Your Jurisdiction – Mainland or Free Zone

The next thing you’ll want to do is register your company in either the UAE Mainland or one of the UAE Free Zones.
Mainland Licenses allow you to access the local UAE market and government contracts. Depending on the activity your business is involved in, you may be required to have a local sponsor.
Free Zone License allows you to have 100% foreign ownership, easy setup, and  import and export tax exemptions. Free Zones are great for new business owners and small to medium-sized international businesses that are doing exports and/or online business.
If you’re targeting local UAE clients, a mainland business setup in Dubai may be ideal. However, a free zone company formation provides 100% ownership and simplified setup.


Step 3: Reserve a Trade Name and Define Your Business Activity

Once you have selected your jurisdiction, it is time to select a trade name and business activity.
The trade name registration in UAE should should follow all legal naming rules (no political or religious references).
A business activity describes in more detail what it is you are legally permitted to do – i.e. consulting, trading or manufacturing.
Your trade name registration in UAE will only be reserved for a limited time once approved, so be diligent and proceed to the next step.

 

Step 4 –  Submit Your Application for Initial Approval and Company Registration

You will now apply for initial approval from DED Dubai or the Free Zone Authority:
Department of Economic Development (DED) – for the Mainland.
Free Zone Authority – for free zone companies.

You will need to provide the basic business requirements:

  • Passport copies of owners/partners
  • Business plan (for certain activities)
  • Visa details
  • Proof of address/lease if required

When the application is approved you can now move onto the next stage and make payment and documentation.


Step 5 – Select an Office Space or Flexi-Desk

A registered business address is required for licencing/registration.
For free zones, you can even choose flexible options like a virtual office or a flexi-desk.
For a mainland set up you might be required to rent an office space.
Your workspace options will depend on your business and your budget, as well as the jurisdiction you select. 

Step 6 – Submit Your Application and Pay the Fees

Once you have your documents in order, you will need to submit your application for the business licence and, if required, pay the fees associated with setting it up.

Fees will vary based on:

  • The Business activities
  • The business licence type
  • The jurisdiction (free zone or mainland)
  • Any additional approvals neededOnce your payment is confirmed, the authority reviews your documents and issues the license.

Step 7 – Your Business License

After you are approved, you will be issued your business license in the UAE.
This allows you to properly start doing business, enter contracts, and promote your products and services.
It typically takes from a few days to two weeks to process based on the activity and paperwork.

 

Step 8 – Apply for Visas and VAT Registration

Once you have your UAE business license, you are able to:

  • Apply for business visas for yourself, your staff and dependents. 
  • Register for VAT assuming your turnover is greater than AED 375,000 per annum.  
  • Get ready to navigate the new company tax introduced in 2023.

By keeping your financial and tax systems in check from the get-go, you can save yourself some cash and steer clear of any penalties.

Where Does Starstorm UAE Come In?

Starstorm UAE is here to take the complication out of your business setup in UAE. From selecting your license to dealing with compliance, both your business and you matter.
We provide you with full support, you focus on building your business and let us handle the paperwork. Here are some ways we can help you: 

At Starstorm UAE, your time and cost savings will benefit you, along with the peace of mind knowing your business has been set up correctly.

Conclusion

Acquiring a business license in UAE, can appear to be a complicated process on the outset. If you follow a directed and easy-to-understand outlined process this will help in reducing stress and confusion further down the line. First identify the license you need, locate an appropriate jurisdiction, register your Trade name, compile your documents, then partner with someone you trust to move forward. Whether you are a new founder or a freelancer or whether you’re an international investor the UAE is an extraordinary opportunity. If you’re ready to take the plunge in your business activation, contact Starstorm UAE, your trusted partner in UAE company formation, business licensing, and compliance.

 

FAQs 

1. What is the duration for getting a business license in UAE?
Usually, it will take 5 to 10 working days or so, depending on the authority, jurisdiction and business activity.

2. How much does a business license in Dubai or UAE cost?
The range for the business license cost in UAE is usually AED 10,000 – AED 25,000, regardless of type of license or the cost of the office space and approvals if necessary.

3. Can a foreign national own 100% of a business in UAE?
Yes, foreign nationals can hold 100% ownership in Free Zones, while many of the activities in Mainland have moved to offer full ownership, some activities still require a local sponsor.

4. Do all business licenses require a physical office?
Most of the Mainland licenses require actual office space; however, most of the Free Zones offer virtual offices/flexi-desk which tend to assist new businesses.

5. Do I have to register for VAT right after I get my license?
You must register for VAT if your business earns more than AED 375,000 annually. You may voluntarily register for VAT if your turnover is roughly AED 187,500.

6. Can Starstorm UAE help with renewals and compliance?
Yes! Starstorm UAE can assist you with your business license renewals, VAT filing, corporate tax registeration and business compliance to keep your company active.

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