Today, it is easier for foreigners to start their own businesses in Dubai than ever before. The ownership reforms of 2021 provided that the majority of activities are now 100% foreign owned (no local Emirati partner required) both on the mainland and in free zones. Accessible does not necessarily mean simple. The licensing is typically the quickest. The areas that tend to be problematic involve selecting the right jurisdiction, budgeting for the actual first year cost and obtaining a corporate bank account approval.
From choosing a structure to setting it up stage by stage, real costs and timelines, taxes, banking, visas and post-licensing compliance measures. If there are numbers dependent on your activity, or your free zone, we state this rather than giving one number as if it applied to everyone.
Mainland vs Free Zone vs Offshore: Whichever Structure is Right for a Foreigner?
It’s the first decision and influences nearly all of the costs and limitations thereafter.
| Factor | Mainland | Free Zone | Offshore |
| Who regulates it | Dubai DET (Department of Economy and Tourism) | The specific free zone authority (e.g., IFZA, DMCC, JAFZA) | Offshore authorities (e.g., JAFZA Offshore, RAK ICC) |
| Foreign ownership | 100% for most activities | 100% | 100% |
| Where you can trade | Anywhere in the UAE, including government contracts | Primarily within the free zone and internationally; mainland trade usually needs a distributor or dual license | Cannot trade inside the UAE at all |
| Physical office | Required (a leased space with an Ejari tenancy contract) | Flexi-desk or shared workspace often accepted | No physical office required |
| Visa eligibility | Yes, tied to office size | Yes, tied to package/visa quota | No, offshore companies cannot sponsor UAE residency visas |
| Typical use case | Retail, consulting firms targeting local clients, government suppliers | Trading companies, e-commerce, consultants, holding companies | Holding assets, international trade, IP holding structures |
Mainland companies
A mainland company is licensed by the Dubai’s DET, and it will enable you to sell to UAE citizens, place bids on government contracts and open branches anywhere in the country. Full foreign participation is now allowed in most of the professional and commercial activities, with only a handful of “strategic impact” activities (mainly defense, security and some utilities) remaining subject to Emirati involvement.
Free zone companies
Ownership, repatriation of profits and import/export duty exemptions are part of the model, which was established to attract foreign investors to invest in free zones. The downside is access to the market, in that obtaining a basic free zone license means that you can only sell directly to the UAE mainland market, but not when a distributor relationship is required or a dual license is needed.
Offshore companies
Offshore companies (JAFZA Offshore, RAK ICC, etc.) are not established for the purpose of conducting a business in the UAE; they serve to hold assets, conduct international trading or to hold property. They are not able to lease office space locally, sponsor visas or grant a regular trade license.
So which should you go for?
Doing business with UAE customers or tendering to government projects → mainland
Working in a business that doesn’t require sales on UAE mainland, such as online, consulting or international trading business → free zone
Having an asset, IP or an international structure without an UAE presence.
The process to create a business in Dubai as a foreigner can be completed step-by-step as follows:Steps to Become a Business Owner in Dubai as a Foreigner:
Here are the steps to be followed to start a business in Dubai as foreigners, in the order government authorities take them.
This is a step-by-Step process to Start a Business in Dubai as a Foreigner.
Here is a conceptual guide of the steps that help you to start a business in Dubai as a foreigner, in the order that the government authorities process them.
- Decide what kind of business activity you will pursue: Each license is issued for a specific set of activities (DET has more than 2,000 licenses for activities on the mainland). This selection defines your license category, approving authority and, in some instances, if you require an additional approval from an external regulator (as an example, health, education, or monetary activities).
- Select your jurisdiction: Use comparison above to decide if it is a mainland, free zone or offshore.
- Choose a legal structure: The most popular versions are Limited Liability Company (LLC), sole establishment, branch of foreign company, and civil company for some professions. The LLC is the most popular entity type for foreign investors because it limits personal liability of the investor to the amount of capital invested.
- Apply for a trade name: Up to three name suggestions can be submitted; the name shall not be the same as previously registered, nor contain restricted names (religious terms, government names or profanity).
- Apply for initial approval: This is a statement from the Government which can be used to proceed with the business, but not yet to obtain a trade licence. This is necessary prior to signing a lease or the Memorandum of Association (MOA).
- Put your hand in the pocket and write your MOA: Mainland businesses would require a registered tenancy contract (Ejari) while free zone businesses usually opt for a flexi-desk or office package from the free zone itself. Shareholding, scope of activities and management structure are defined by the MOA.
- Finalize paperwork and pay licensing fees: After approvals, the lease and the MOA, you submit the full file with the payment of the license fee and get a trading license.
- Apply for visas and opening a company bank account: Once you have the license, you can work on getting an establishment card, then the investor and employee visas, then finally get a corporate account with the banks (where the majority of your delays will occur, see the banking section below).
The documents required for foreign business setup in Dubai are as follows
To set up a business in Dubai, the following documents are required:
While the requirements differ somewhat from activity to jurisdiction, the most common questions are:
- Passport copies of all shareholders and appointed manager.
- Passport-size photographs
- Completed application form of relevant Free Zone or DET
- A business plan (required for some free zones and required by most banks for opening business accounts even if it is not required by the licensing authority)
- For initial approval, this is the proof.
- To obtain a No Objection Certificate from any UAE Sponsor, if you already have a UAE visa in your name from another UAE Sponsor.
- There is a Notarized Memorandum of Association (MOA) which is to be memorized if necessary.
- The coordinates of the property and a copy of the tenancy contract or free zone facility agreement (Ejari in the mainland) are required.
- Corporate shareholders’ certificate of incorporation, board resolution, and (typically) a bank reference letter from the parent company bank
Cost of Starting a Business in Dubai as a Foreigner (2026)
All “start from AED X” figures are per license fee, without any other costs. The realistic number of first years (including office, visas and admin costs) would typically be 1.5 to 3 times the headline number. Don’t budget from a single number, use the ranges below.
| Cost item | Typical range (AED) | Notes |
| Free zone license (headline fee) | 5,750 – 50,000+ | Ranges from budget zones like RAKEZ or Meydan to premium zones like DIFC |
| Mainland trade license | 10,000 – 30,000+ | Depends on activity type; general trading licenses sit at the higher end |
| Office / flexi-desk | 8,000 – 25,000/year | Mainland requires a registered tenancy; free zones often bundle this into the license package |
| Establishment card | 2,000 – 3,000 | Required before visa applications |
| Investor/employee visa (per visa) | 3,500 – 7,000 | Includes medical test and Emirates ID; multiply by headcount |
| Initial approval and government fees | 2,000 – 6,000 | Varies by activity and external approvals needed |
Two factors that are not discussed by most of the guides: in many Free Zones the renewal costs are as much as the set-up costs, from AED 10,000 to 20,000 per year and before you are licensed, there are activities that need approval from the external regulators, which will come in addition at a cost of tens of thousands of dirhams.
How Long Does It Take?
Often marketing pages claim a “license in 24 hours. This may be possible for the license document in some free zones, but not as prepared to operate.
| Stage | Realistic timeline |
| Trade name reservation | 1–2 business days |
| Initial approval | 2–5 business days |
| Free zone license issuance | 3–7 business days once documents are complete |
| Mainland license issuance | 1–3 weeks, longer if external approvals are needed |
| Establishment card and visas | 1–3 weeks per visa, including medical testing |
| Corporate bank account approval | 2–8 weeks, sometimes longer for non-resident directors |
Corporate bank account approval takes 2-8 weeks, and may take longer for non-resident directors
It takes one to three months for the overall process rather than one week really, but this comes down to the bank account.
Taxes You Need to Know
The Government of uae provides a corporate tax rate of 9% for taxable income over the initial AED 375,000 with a 0% rate for the first AED 375,000. This bracket will be permanent no matter the size of the company.
Currently, small businesses in the UAE that are resident businesses with annual revenue of AED 3 million or less have the option to elect to treat their small business income as zero on a yearly basis (also known as small business relief) but this relief is only confirmed on a year by year basis with the FTA through the EmaraTax portal for periods of tax up to 31 December 2026. It is not allowed with Qualifying Free Zone Person (QFZP) status.
Alternative regime for free zone companies, which keeps 0% tax on ‘qualifying income’ and 9% tax on ‘non-qualifying income’ without any ceiling on income and no expiry date for 2026.
VAT rate: 5% and Mandatory Registration over AED 375,000 of taxable supplies in 12 months, voluntary Registration above AED 187,500.
Customs duty: 5% on imports (normally exempted from duty if the goods are re-exported instead of being sold in the UAE mainland within a free zone).
Decision is made on which regime is suitable for a particular business, this is why this is not a decision to be taken based on a blog post, rather it should be confirmed with a licensed UAE tax advisor before deciding to elect any regime or opt for the Small Business Relief.
Opening a Business Bank Account as a Foreigner
Just because you have a trade license, doesn’t mean you have a bank account! The UAE banks have their own compliance review mechanism for anti-money laundering requirements, and are more diligent to scrutinise new firms, offshore structures and non-resident directors than they were in the past. Be prepared to provide the bank with:
- Clear explanation of the range of business activity and expected volumes of transactions that your business will undertake
- A business plan or a contract with any actual client
- You must show the source of your initial capital.You will need to present proof of the source of your initial capital.
- At least one of the signatories physically attending in most instances, and some banks are now providing remote onboarding for existing free zones
- What works in increasing the likelihood of approval: go to multiple banks, look for a free zone that has a long track record with a bank, have a focused and specific business, and be prepared to present actual invoices or contracts, not projections.
Options for foreign business owners: Visas and Residency
Standard type of investor visa which is based on the company’s license and the size of the office is generally granted for 2–3 years and can be renewed as long as the company continues to operate.
Entrepreneur Visa (Golden Visa): Residency for up to 5 years for the founders of a project that has an investment of AED 500,000 or more, or the founders of a UAE SME, whose annual revenue is above AED 1 million.
Golden Visa / Business-owner – a residence obtained via public investment, based on the amount of investment invested in an approved fund, property or business, for 10 years and could be renewed.
Golden Visa is not automatic solely because you have a trade license, the revenue or investment requirements are evaluated and documentation must include audited financials or a letter of funds.
Common mistakes foreign entrepreneurs can make.
Selecting a free zone without considering the other factors that come with it only to find out that the free zone doesn’t allow direct sales to the right kind of customers that the business wants to sell to.
Failing to understand the time required to get the bank account up and running, and committing to a lease or hiring a staff member before those funds are in the company.
Relying on the concept that “free zone” is synonymous with “no tax” when it is not necessarily true because the business may not be a Qualifying Free Zone Person or the structure may not be covered by Small Business Relief.
Failure to comply with Ultimate Beneficial Owner (UBO) and Economic Substance Regulations (ESR) filings, despite the activation of the license, for certain activities (holding companies, distribution, leasing and others).
Taking the published fee for the license as the total budget, then running short of the visa, office and follow on visa renewal costs.
Once set up, the standards for compliance are established.
Setup is just the initial part of compliance work.
Registration with the FTA for corporate tax for almost all businesses in the UAE, whether or not tax will be paid.
VAT registration from the point when the threshold is breached and then quarterly/monthly declarations are filed.
UBO declarations (information on individuals with ultimate ownership or control of the company).
Economic Substance Regulations (ESR) notifications, which apply to certain “relevant activities”, including holding company business, distribution and service centre business, leasing and finance and headquarters business.
An annual license renewal as well as the re-negotiation of tenancy or facility contracts.
From these, the financial statements are audited, which is a requirement for most (and increasingly demanded by free zones and banks, even when not required) LLCs on the mainland.
Final Thoughts
While it is possible to start a business in Dubai as a foreigner, and is a viable and supported option in 2026, the actual license is not typically the part of the plan. Choose the right jurisdiction for sales, factor in the total first year costs—not just the license fee, and begin the bank account discussion early, not after the license has been issued. The three decisions govern the time required for the process, which can be four weeks or four months.
When you’re considering choosing a jurisdiction or are looking to know the actual costs and expenses as opposed to a range based on the activity, [book a consultation] to get a jurisdiction and cost breakdown specific to your activity.
Frequently Asked Questions
Is a 100% ownership possible for foreigners in Dubai?
Yes, most mainland and free zone activities from the reforms on 2021. There is a small number of “strategic impact” activities that still need Emirati involvement, so please check what type of activity you are participating in with the current DET list.
What are the costs as a foreigner to set up a business in Dubai?
The business license, one office package, one visa and government fees for a solo founder would be about AED 35,000-65,000 in the first year. The number of visas, office size, or external regulatory approvals for the activities increases, so does the cost.
Should I have to be in Dubai in order to have a business there?
No, you don’t have to be a resident to be an owner or shareholder of a UAE company. But, many times opening a corporate bank account and applying for certain visas will require your, or some other signatory, presence at some point in the process.
Is there a possibility to obtain a UAE residency through business?
Yes, via a standard investor visa, or via investor visa as an entrepreneur or as a business owner, if your project or your revenues satisfy the requirements.
So what is the difference between mainland and free zone for foreigners?
Market access. Mainland enables you to connect with UAE residents and bid on government contracts, all across the UAE. Free zone companies are established for international trade, electronic commerce and consulting businesses and have limited access to the mainland retail market.
Do business owners have to pay tax in Dubai?
Not entirely. There is no personal income tax, but the rate of corporate tax is 9% on profits exceeding AED 375,000; Small Business Relief (0% tax for profits under AED 3 million) is confirmed until the end of 2026.
What is the timeframe for Dubai Trade License?
Some free zones can issue the license in a few business days. It will take 4-12 weeks for everything to be in place (visas, etc. and working bank account).
Can I open Business Bank Account in UAE from outside UAE?
New companies without trading experience in UAE, or those with no UAE signatories, will most likely need to visit the bank or free zone in person for remote onboarding, but some banks and free zones will allow it.
