How to Set Up a Business in the UAE: A Complete Guide for New Businesses

The UAE is known globally as a business hub offering a strategic location, tax incentives, and a thriving economy. It presents numerous opportunities for entrepreneurs and foreign investors alike. However, navigating the process of setting up a business can be complex, especially for newcomers. In this guide, we’ll walk you through each step of the process and explain how Hubpay Business Accounts can streamline your financial operations with transparent pricing, easy digital onboarding, and multi-currency support.

Step 1: Choose Your Business Type and Jurisdiction

When starting a business in the UAE, the first decision you need to make is about your business structure and jurisdiction. There are three main options:

• Mainland: Allows for operations both inside and outside the UAE. However, it requires a local sponsor who owns 51% of your business shares.

• Free Zone: Offers 100% foreign ownership and tax exemptions, typically suited for businesses catering to international markets.

• Offshore: Ideal for businesses that operate internationally but not in the UAE. This setup is often used for asset protection and international operations.

For more information on Free Zones and their benefits, visit the UAE Free Zones Authority.

Step 2: Choose Your Business Name

Choosing a business name is a critical part of the setup process. The UAE has a strict naming policy that avoids offensive, religious, or governmental references. Ensure your name is available and adheres to these regulations.

Step 3: Apply for a Business License

The type of license you’ll need depends on your business activities. There are three primary types:

• Commercial License: For trading businesses

• Professional License: For service-based businesses

• Industrial License: For manufacturing companies

For a detailed breakdown of licensing, refer to the UAE Business Setup Guide.

Step 4: Secure a Physical Office Space

Many UAE business regulations require that your business has a physical office space. For Free Zone businesses, this is often included in the license package. However, mainland businesses must secure their own premises.

Step 5: Open a Business Account

Opening a business account is one of the most tedious steps for new businesses in the UAE. Traditional providers often require extensive documentation and have long approval wait times. Hubpay provides a much faster and transparent alternative.

• Starter Plan: AED 99/month with 30,000 USD transaction limit

• Scale Plan: AED 299/month with 200,000 USD transaction limit

• Treasury Plan: Custom pricing for large businesses

Note: Hubpay offers immediate multi-currency support with simple digital onboarding. Learn more about Hubpay's Business Accounts here.

Hubpay also provides fully digital onboarding, allowing you to choose how urgently you need to open your account:

• Express: AED 5000 – Account opened in 1 business day

• Standard: AED 2000 – Account opened in 7 days

• Saver: AED 1000 – Account opened in 14 days

Step 6: Register for VAT

If your business’s annual revenue exceeds AED 375,000, registering for VAT with the Federal Tax Authority is mandatory. Failure to register can result in penalties. For more details, check the Federal Tax Authority VAT Registration page.

Step 7: Hire Employees and Apply for Work Visas

If you plan to hire employees, you will need to apply for work visas for them through the UAE’s immigration authorities. This includes submitting documents like your business license and employee passports. Employees will also need to undergo medical testing and obtain Emirates IDs.

Step 8: Obtain Additional Licenses or Permits

Certain business activities in the UAE require additional permits or approvals from regulatory bodies. For example, if you’re in the healthcare, education, or food industry, you’ll need to acquire sector-specific licenses before you can legally operate.

Why Choose Hubpay Business Accounts?

Starting a business in the UAE can be an overwhelming process, particularly when it comes to managing your financials. Traditional banks often make it difficult for new businesses to get off the ground due to lengthy approval processes, high fees, and limited support for multi-currency transactions.

Hubpay Business Accounts offer a solution to these challenges by providing transparent pricing, fast account setup, and immediate access to global payment capabilities. Whether you’re a small startup or a growing medium-sized business, Hubpay helps you manage finances efficiently without the hassle of traditional banks.

Sources used:

1. GRG UAE Free Zones - Business Setup in UAE - https://www.uaefreezones.com/
2. Set up your Business in Dubai | Invest in Dubai - https://www.investindubai.gov.ae/
3. Hubpay Business Accounts - https://wearehubpay.com/pricing
4. Federal Tax Authority United Arab Emirates - https://tax.gov.ae/ar/default.aspx