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in UAE

The type of the company in RAK is International Business Company (IBC)

IBC refers to International Business Company

It is a company which does not conduct substantial business in its country of incorporation.

It is formulated in a tax free jurisdiction.

It legally minimizes any type of tax burdens.

It improves one's wealth management

Business setup in Dubai has normally been regarded as easy, with the city's policies being friendly towards businesses, but that ease may differ based on the type of business, location, and ownership preferences.

Key Factors Contributing to Ease:

1. Free zones: Dubai has more than 30 Free Zones, including DMCC and Dubai Internet City, that offer streamlined processes to set up businesses, especially for foreign investors. Full foreign ownership, no personal or corporate tax, and a simplified system of getting licenses-that is what entrepreneurs get in these zones.
2. Government Incentives: The DED in Dubai paves the way and simplifies the process with much ease, especially in terms of licensing, for companies in the emirate. Moreover, initiatives such as the Dubai SME promote and finance startups and small businesses, with added incentives.
3. Digital and automated services: The government of Dubai has invested much in digital infrastructure, and most of the steps with regard to licensing and registration can be completed online, therefore saving much time and reducing much paperwork. Initiatives such as Dubai Now and the Dubai Trade portal give access digitally to most government-related procedures.
4. Tax Benefits: There is no personal income tax and generally no corporate tax; this reduces the administrative burden and thus becomes highly attractive for international investors.

Challenges:

1. High cost of living/fees: Office rent, fees of visas, and other operational costs are high, especially in the mainstream areas. The Free Zone costs vary widely, and some might be more expensive than others.
2. Industry-specific regulations: May need special approval from the regulating body, which extends the time for set-up. For instance, industries related to finance or health may have special licenses.
3. Sponsorship requirements: The general requirement in mainland is that it has limited foreign ownership, often requires a local sponsor; recent reform allows foreign ownership of up to 100% for specific types of industries.

There are 02 ways you can start a business in Dubai: free zone business setup and mainland business setup. As a foreigner, you should choose the former option, as it offers more exclusive benefits for overseas businesses.

The cost for Dubai free zone company setup varies depending on the type of free zone business setup that you choose, e.g. Dubai Multi Commodities Centre Authority (DMCC), Dubai Creative Clusters Authority (DCCA) and Jebel Ali Free Zone (Jafza). Generally, Dubai free zone company setup costs range from AED 9,000 to AED 10,000. Other fees incurred during the free zone business setup includes:

• Licence Fee: AED 10,000 to AED 50,000 per year
• Office Fee: AED 15,000 to AED 20,000
• Share Capital: AED 1,000 to as much as AED 1,000,000

Out of all Dubai free zones, DMCC is our top choice for free zone company setup. Even though the setup cost is a bit higher than other free zones, DMCC is still a better option as it provides a variety of value-added services and support for foreign businesses. Being the world-leading free zone for 6 consecutive years, DMCC is the ideal destination for Dubai free zone company setup.