Add description for your Article
Steps to Start a Small business in the United Arab Emirates
Starting a small business is a dream of many. Even though there are a lot of risks, many people desire to be the CEO of their own company. One of the preferred countries for these people to set up their small businesses in the United Arab Emirates. There are many reasons people choose to start a small business in the United Arab Emirates.
One of the main things that entice people to start a small business here is the favorable tax treatment of the UAE, imposing zero percent on personal & corporate incomes.
Also, the location, located at the heart of the Middle East, makes it the perfect hub to conduct global trade. Now that we know, people aspire to start a small business here, but the question is how?
Worry not! We have listed six simple steps to start a small business in the United Arab Emirates.
Six Steps to start a small business in the United Arab Emirates:
1) Decide business activity:
The first step in starting a small business in the UAE is deciding the business activity. The Department of Economic Development (DED) has a list of more than 2100 permissible business activities & you can choose the one that matches your requirements. It is mandatory to include all these activities before applying for the small business license. Failure to specify the suggested activities may result in problems later on.
2) Determine the best Company Name for the business:
Now that selecting the business activity for starting a small business in the UAE is done, it is time to choose the best name for the small business. There are several factors to consider while naming a small business in the UAE. One must heed a few rules when choosing a small business name, and these rules are rigid yet easy to follow. Avoid any
- Offensive or irreverent language irreverent language.
- Names of well-known organizations
- Abbreviations if naming the company after yourself.
3) Decide the location to set up the small business; Free zone or Mainland (UAE)
Before applying for the small business license, the final step is to decide where you want to set up your small business in the United Arab Emirates. Either it is the Free zone or the Mainland of the UAE. Also, read Difference between Free zone and Mainland.
There are many advantages to both zones.
Benefits of choosing Free zone:
Free zones such as Fujairah offers benefits such as
- Quick and easy incorporation process,
- Ongoing business support and
- Financial incentives such as tax exemptions and zero currency restrictions.
Click here to know the Freezones in the United Arab Emirates.
Benefits of choosing the Mainland zone:
The Mainland zone will permit trade directly with the UAE market and accept potentially lucrative government contracts. The nature of the small business determines the setup that is right for you.
4) License application for the small business aiming to set up in the UAE:
The vital thing for starting a small business in the UAE is the business license. Obtaining a small business license in Freezone or the Mainland is an easy process;
For setting up a small business in the Freezone of the UAE, you must apply for the small business license directly with the
- Department of Economic Development or
- The Municipality in the Emirate where you will be operating.
The issuance of the Free zone business license happens in a matter of days. It generally depends on the type of the business and the small business license required.
The small business aiming to set up on the Mainland, the license applications will usually take three weeks to process.
For the license application, there are some documents required:
- The filled application form
- Passport copy of the proposed owner/owners
- Two colored passport-size photos.
5)Applying for a visa.
A UAE visa is also another vital requirement for starting a small business in the UAE.
The visa application procedure for the small business owner & also the staff is precise yet easy. The business owner, the holder of the small business license, can also sponsor visas for others such as
a spouse, parent, or child, or a domestic worker such as a housekeeper. Again, the number of visa permits you can apply for will depend on
- The size of your company,
- The chosen setup.
And for dependant visas, it depends on the personal earnings.
6) Opening a business bank account.
The final step in starting a small business in the United Arab Emirates is opening a bank account. The UAE has strict anti-money laundering legislation, & it is hard for foreign entrepreneurs to access corporate banking facilities. Thus, working with a professional expert in this sector makes the process easier. These experts have strong connections with both local and international banks. They can easily connect with the one that best suits your small business needs.
Starting a small business in the United Arab Emirates with little or no knowledge can be overwhelming. Here is where RVG chartered accountants will come to your rescue. Trust our experts and leave your worries to us. Our experts will help you guide how to start a small business in the UAE according to your business requirements. They will help you register and set up your small business effortlessly.
Also read Accounting Tips for Small Scale Business from here.