Relocating a business overseas is a strategic move, especially when targeting regions with strong economies and business-friendly environments. Dubai, a global hub for trade and investment, stands out as an attractive destination for foreign entrepreneurs. With its tax advantages, modern infrastructure, and investor-friendly regulations, Dubai offers exceptional potential for international business growth.
If you’re considering moving your foreign business to Dubai, this guide provides a detailed, professional, and actionable overview to help you navigate the process with clarity and confidence.
Why Relocate Your Business to Dubai?
While many business owners prefer to operate in their home countries, moving to a jurisdiction with better economic and regulatory conditions is often a smart business decision. Dubai is part of the United Arab Emirates (UAE), which is renowned for its pro-business policies, tax incentives, and access to global markets.
Relocating your company to Dubai allows you to:
- Leverage a zero personal income tax regime
- Access a strategic location connecting East and West
- Benefit from a diversified economy beyond oil
- Tap into high-net-worth clientele and global investors
Whether expanding operations or seeking a full relocation, understanding the local business environment is essential.
Key Considerations When Moving a Foreign Business to Dubai
1. Business Operating Jurisdictions
Dubai offers three main types of business jurisdictions:
- Mainland Companies: Can operate throughout the UAE without restrictions. Ideal for businesses planning to trade directly within the UAE market.
- Free Zone Companies: Restricted to operating within the designated free zone but enjoy 100% foreign ownership, zero import/export taxes, and full profit repatriation.
- Offshore Companies: Ideal for international trade and asset protection, these entities cannot conduct business within the UAE but offer tax neutrality and operational flexibility.
Each jurisdiction serves different business goals, so selecting the right one is crucial to your success.
2. Corporate Taxation in the UAE
Understanding the tax structure is critical when relocating your company:
- 9% Corporate Tax on profits exceeding AED 375,000 (approx. USD 102,100).
- 15% Corporate Tax for entities subject to global minimum tax obligations.
- 0% Tax Rate for businesses earning below the threshold.
- Free Zone Entities may remain exempt if they do not conduct business within the mainland.
Additionally, foreign banks and oil companies pay a flat 20% corporate tax.
3. VAT and Excise Duties
- Value-Added Tax (VAT): Introduced in 2018, VAT stands at 5% on most goods and services. Some sectors such as international transport, healthcare, education, and residential property are either zero-rated or exempt.
- Excise Tax: Levied on products deemed harmful to public health or the environment. This includes:
- 50% tax on sugary beverages
- 100% tax on energy drinks and tobacco products
These taxes are applicable across both mainland and free zone businesses where relevant.
4. Bilateral Investment Treaties (BITs) and Tax Agreements
The UAE has built a robust international legal framework to support foreign investors:
- 143 Double Taxation Avoidance Agreements (DTAs)
- 112 Bilateral Investment Treaties (BITs)
- 17 Treaties with Investment Provisions (TIPs)
- 22 Investment-Related Instruments (IRIs)
These agreements provide legal protection, ensure tax efficiency, and foster cross-border cooperation.
5. Staff Compensation and Compliance
Employers in Dubai are obligated to:
- Compensate employees in accordance with UAE labor laws
- Cover visa costs and travel expenses for relocating international staff
- Provide mandatory health insurance coverage
Notably, the UAE does not levy personal income tax, simplifying payroll administration for companies and employees alike.
How to Register a Foreign Company in Dubai
Setting up a foreign business in Dubai involves several legal and administrative steps:
- Choose a Business Name: Must be unique and conform to UAE naming guidelines.
- Select a Jurisdiction: Mainland, Free Zone, or Offshore.
- Obtain Initial Approvals: From the Dubai Department of Economic Development (DED) or the relevant free zone authority.
- Draft Legal Documents:
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Finalize Office Space: Some licenses require physical office premises; lease agreements must be submitted.
- Submit Documentation: Including passports, visas, parent company registration, and other regulatory documents.
- Pay Fees: Application, licensing, and administrative fees.
- Receive Trade License: Upon approval, this license legalizes business operations in Dubai.
Regulatory Requirements for Business Relocation
Foreign companies must comply with the following UAE business laws:
- Foreigners can establish Sole Proprietorships, LLCs, or Branch Offices
- 100% Ownership is permitted in both Free Zones and mainland jurisdictions
- A UAE Residency Visa is required to register a business
- Business owners must open a local bank account for operations (usually takes 2–4 weeks)
- Licensing types include:
- Commercial License
- Professional License
- Industrial License
Each license type corresponds to specific business activities and must be renewed annually.
Visa Options for Business Owners and Staff
The UAE offers multiple visa solutions to support business relocation:
- Investor Visa (Work Visa): Valid for 2 years, requires employer sponsorship.
- Green Visa: For freelancers and self-employed professionals, offering 5 years of validity without sponsorship.
- Golden Visa: A long-term 10-year visa for entrepreneurs, investors, and skilled professionals. Includes family sponsorship and does not require a local employer.
Understanding visa types ensures smooth onboarding for business owners and international teams.
Benefits of Relocating a Foreign Business to Dubai
Dubai is a dynamic business center offering a wide array of advantages:
- Strategic Location: Gateway to the Middle East, Africa, and Asia
- Tax-Friendly Environment: Zero personal income tax, low corporate tax rates
- Modern Infrastructure: Advanced transportation, logistics, and communications
- Economic Diversity: Opportunities in tourism, logistics, real estate, healthcare, and financial services
- High Quality of Life: Safe environment, world-class amenities, and global connectivity
Dubai’s progressive regulatory landscape and global connectivity make it an ideal destination for ambitious entrepreneurs and global companies.
Final Thoughts
Relocating a foreign business to Dubai can be a transformative step toward international growth. With its zero-tax regime, modern infrastructure, and pro-business policies, Dubai presents a compelling case for businesses aiming to expand in the Middle East and North Africa (MENA) region.
However, the relocation process involves multiple legal and regulatory requirements. Partnering with a reliable business consultancy can simplify this journey. A professional advisory team can help you select the right business structure, ensure legal compliance, and facilitate a smooth registration process.
Dubai continues to rise as a global commercial hub—and with the right planning and expert support, your business can be part of its extraordinary success story.
Get in touch with Arab Asset Consulting to know more.
Relocating a business overseas is a strategic move, especially when targeting regions with strong economies and business-friendly environments. Dubai, a global hub for trade and investment, stands out as an attractive destination for foreign entrepreneurs. With its tax advantages, modern infrastructure, and investor-friendly regulations, Dubai offers exceptional potential for international business growth.
If you’re considering moving your foreign business to Dubai, this guide provides a detailed, professional, and actionable overview to help you navigate the process with clarity and confidence.
Why Relocate Your Business to Dubai?
While many business owners prefer to operate in their home countries, moving to a jurisdiction with better economic and regulatory conditions is often a smart business decision. Dubai is part of the United Arab Emirates (UAE), which is renowned for its pro-business policies, tax incentives, and access to global markets.
Relocating your company to Dubai allows you to:
- Leverage a zero personal income tax regime
- Access a strategic location connecting East and West
- Benefit from a diversified economy beyond oil
- Tap into high-net-worth clientele and global investors
Whether expanding operations or seeking a full relocation, understanding the local business environment is essential.
Key Considerations When Moving a Foreign Business to Dubai
1. Business Operating Jurisdictions
Dubai offers three main types of business jurisdictions:
- Mainland Companies: Can operate throughout the UAE without restrictions. Ideal for businesses planning to trade directly within the UAE market.
- Free Zone Companies: Restricted to operating within the designated free zone but enjoy 100% foreign ownership, zero import/export taxes, and full profit repatriation.
- Offshore Companies: Ideal for international trade and asset protection, these entities cannot conduct business within the UAE but offer tax neutrality and operational flexibility.
Each jurisdiction serves different business goals, so selecting the right one is crucial to your success.
2. Corporate Taxation in the UAE
Understanding the tax structure is critical when relocating your company:
- 9% Corporate Tax on profits exceeding AED 375,000 (approx. USD 102,100).
- 15% Corporate Tax for entities subject to global minimum tax obligations.
- 0% Tax Rate for businesses earning below the threshold.
- Free Zone Entities may remain exempt if they do not conduct business within the mainland.
Additionally, foreign banks and oil companies pay a flat 20% corporate tax.
3. VAT and Excise Duties
- Value-Added Tax (VAT): Introduced in 2018, VAT stands at 5% on most goods and services. Some sectors such as international transport, healthcare, education, and residential property are either zero-rated or exempt.
- Excise Tax: Levied on products deemed harmful to public health or the environment. This includes:
- 50% tax on sugary beverages
- 100% tax on energy drinks and tobacco products
These taxes are applicable across both mainland and free zone businesses where relevant.
4. Bilateral Investment Treaties (BITs) and Tax Agreements
The UAE has built a robust international legal framework to support foreign investors:
- 143 Double Taxation Avoidance Agreements (DTAs)
- 112 Bilateral Investment Treaties (BITs)
- 17 Treaties with Investment Provisions (TIPs)
- 22 Investment-Related Instruments (IRIs)
These agreements provide legal protection, ensure tax efficiency, and foster cross-border cooperation.
5. Staff Compensation and Compliance
Employers in Dubai are obligated to:
- Compensate employees in accordance with UAE labor laws
- Cover visa costs and travel expenses for relocating international staff
- Provide mandatory health insurance coverage
Notably, the UAE does not levy personal income tax, simplifying payroll administration for companies and employees alike.
How to Register a Foreign Company in Dubai
Setting up a foreign business in Dubai involves several legal and administrative steps:
- Choose a Business Name: Must be unique and conform to UAE naming guidelines.
- Select a Jurisdiction: Mainland, Free Zone, or Offshore.
- Obtain Initial Approvals: From the Dubai Department of Economic Development (DED) or the relevant free zone authority.
- Draft Legal Documents:
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Finalize Office Space: Some licenses require physical office premises; lease agreements must be submitted.
- Submit Documentation: Including passports, visas, parent company registration, and other regulatory documents.
- Pay Fees: Application, licensing, and administrative fees.
- Receive Trade License: Upon approval, this license legalizes business operations in Dubai.
Regulatory Requirements for Business Relocation
Foreign companies must comply with the following UAE business laws:
- Foreigners can establish Sole Proprietorships, LLCs, or Branch Offices
- 100% Ownership is permitted in both Free Zones and mainland jurisdictions
- A UAE Residency Visa is required to register a business
- Business owners must open a local bank account for operations (usually takes 2–4 weeks)
- Licensing types include:
- Commercial License
- Professional License
- Industrial License
Each license type corresponds to specific business activities and must be renewed annually.
Visa Options for Business Owners and Staff
The UAE offers multiple visa solutions to support business relocation:
- Investor Visa (Work Visa): Valid for 2 years, requires employer sponsorship.
- Green Visa: For freelancers and self-employed professionals, offering 5 years of validity without sponsorship.
- Golden Visa: A long-term 10-year visa for entrepreneurs, investors, and skilled professionals. Includes family sponsorship and does not require a local employer.
Understanding visa types ensures smooth onboarding for business owners and international teams.
Benefits of Relocating a Foreign Business to Dubai
Dubai is a dynamic business center offering a wide array of advantages:
- Strategic Location: Gateway to the Middle East, Africa, and Asia
- Tax-Friendly Environment: Zero personal income tax, low corporate tax rates
- Modern Infrastructure: Advanced transportation, logistics, and communications
- Economic Diversity: Opportunities in tourism, logistics, real estate, healthcare, and financial services
- High Quality of Life: Safe environment, world-class amenities, and global connectivity
Dubai’s progressive regulatory landscape and global connectivity make it an ideal destination for ambitious entrepreneurs and global companies.
Final Thoughts
Relocating a foreign business to Dubai can be a transformative step toward international growth. With its zero-tax regime, modern infrastructure, and pro-business policies, Dubai presents a compelling case for businesses aiming to expand in the Middle East and North Africa (MENA) region.
However, the relocation process involves multiple legal and regulatory requirements. Partnering with a reliable business consultancy can simplify this journey. A professional advisory team can help you select the right business structure, ensure legal compliance, and facilitate a smooth registration process.
Dubai continues to rise as a global commercial hub—and with the right planning and expert support, your business can be part of its extraordinary success story.
Get in touch with Arab Asset Consulting to know more.
