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Set Up an Onshore Company in Dubai

Set Up an Onshore Company in Dubai

Those who want to set up a company in Dubai can open onshore companies to complete activities in and outside the UAE. For this purpose, they need to comply with the requirements of the Company Law. Below, our Dubai company incorporation specialists explain the requirements related to the creation of an onshore company. You can rely on us for complete assistance in mainland company incorporation in Dubai.

 Quick Facts  
 What is an onshore company in the UAE?   Can operate within the UAE and in one of the free trade zones available. Can also carry out its activities outside UAE. 

 Most well-known free zones for opening an onshore company in Dubai

– Dubai International Financial Center,

– Dubai CommerCity,

– Dubai Multi-Commodities Center (DMCC) 

 Proper business structure for onshore companies in Dubai  

 Limited liability company

Regulatory body     Department of Economic Development in Dubai (DED)
 Local partner required  

For onshore companies developing activities within the UAE, a local partner owning 51% of the shares is needed. 

 Local agent needed  

A local representative is required for opening an onshore company in Dubai. 

 100% foreign ownership 

Only in free trade zones of the UAE 

 Business trade license required (YES/NO)  

 YES

 Legal address required (YES/NO) 

 YES

 Bank account for an onshore company in Dubai (YES/NO)   YES
 Is virtual office a solution for onshore companies in Dubai? 

 Yes, a virtual office can be selected for establishing an onshore company in Dubai.

 Tax registration 

 An onshore company must have a VAT number in Dubai.

 Corporate tax in Dubai  

9% for companies generating incomes of more than AED 375,000 

 Advantages of onshore companies in Dubai  

– no personal liability,

– no capital gains tax,

– financial freedom,

– business flexibility 

 Why work with our local agents in Dubai? We can help international investors set up an onshore company in Dubai by managing the formalities and paperwork. We also collaborate with the relevant registration authorities. 

Categories of companies in Dubai

Investors can open three types of companies in Dubai:

  • onshore companies used to operate within the local UAE market,
  • free zone companies usually employed by foreign investors operating within Dubai’s free zones,
  • offshore companies that allow full foreign ownership and are employed as asset, property, or holding companies in Dubai.

Foreign investors may also choose to register an onshore free trade zone company in Dubai which is among the most common types of companies registered in Dubai because of the tax benefits it offers.

You can rely on our company registration advisors in Dubai for guidance on choosing the legal entity under which you can develop a successful business. Also, the following infographic reveals interesting facts about onshore companies in Dubai:

What are the available types of Dubai onshore companies?

According to the Companies Law in Dubai, onshore companies may be incorporated under different forms among which limited liability companies, private and public shareholding companies. Foreign companies also have the possibility of registering branch offices or subsidiaries as onshore companies in Dubai. All types of onshore companies have different shareholding structures and share capital requirements as follows:

  • Dubai limited liability companies must have at least one UAE national partner holding at least 51% of the paid-up capital,
  • free zone companies allow 100% foreign ownership.

Licensing requirements apply to all types of companies. We can provide you with information on all types of entities if you are planning to set up a Dubai company.

What does it mean to register an onshore company in Dubai?

Most of the time, businesspersons must choose between onshore and free zone companies when deciding for company incorporation in Dubai. There are several differences between these entities, and we mention the most important below:

  • The onshore company can complete its activities on all the territory of the UAE, but also outside of it, while a free zone company is bound to operate within the respective free zone.
  • A foreign investor will need a local partner or sponsor to register an onshore company, while in a free zone, full foreign ownership is permitted.
  • The registration options for an onshore company are multiple, while free zone companies must be registered under the legal structures available in those economic areas.
  • From a licensing point of view, both types of companies can apply for similar licenses, however, free zone companies must complete specific activities of the free zones they are registered in.

Both types of entities have advantages and disadvantages, however, the Dubai onshore company is more suitable for large operations that can be completed in and outside the country. Also, an onshore company can take the form of a limited liability company, a legal entity popular in all countries in the world. Foreign companies seeking to operate in the UAE can also set up onshore companies in Dubai in the form of subsidiaries and branch offices.

Below is a video presentation about onshore companies in Dubai:

Registration requirements and steps for a Dubai onshore company

The opening of an onshore company in Dubai falls under the regulation of the Company Law and implies preparing several documents and filing them with the Dubai Trade Register. To incorporate an onshore company, a local or foreign investor must prepare the Articles of Association and appoint a local agent to complete the registration procedure with the Company’s Registrar.

The following steps need to be completed upon the creation of an onshore company in Dubai:

  1. Find a location that serves as a legal address for the onshore company (a virtual office is a good option for a start).
  2. Draft and notarize the Memorandum and Articles of Association of the company.
  3. Set up a bank account in which the share capital will be deposited.
  4. File the statutory documents alongside the personal information of the shareholders and company directors.
  5. Register for taxation and apply for a VAT number, according to the new VAT legislation.
  6. Apply for one of the licenses mentioned above, by the activities to be completed.

For guidance in registering an onshore company in Dubai, you can rely on our local consultants.

Types of licenses required for onshore companies in Dubai

Registering an onshore company in Dubai also requires applying for the necessary licenses. In this case, a trade license, professional license, and manufacturing or industrial license are requested. In the case of a professional license, this can be obtained by auditing and accounting firms in Dubai, as well as firms active in the medical field. The conditions for obtaining can be explained by one of our specialists. We can help you with the necessary documents for the application for a trade license in Dubai, to ensure that the process is uncomplicated.

Our company formation representatives in Dubai can offer more information on the particularities of onshore companies. Talk to us about how to set up a business in Dubai.

Advantages of setting up onshore companies in Dubai

Foreign entrepreneurs have many benefits if they choose to set up an onshore company in Dubai. Among them, the following are the most appreciated:

  • Foreigners can benefit from 100% ownership when opening an onshore company in Dubai.
  • The UAE has signed various double taxation agreements, and these structures are protected against double taxation.
  • There are no capital gains. However, the corporate tax rate in Dubai was recently introduced and is 9% for businesses generating more than USD 100,000 per year.
  • Applicable legislation for onshore companies in Dubai is permissive.
  • The operating costs of an onshore company in Dubai are affordable compared to other states.
  • Possibility of owning real estate by having an onshore company in Dubai.

These are some of the advantages offered by the onshore company in Dubai. We remind you that if you want to set up a company in Dubai, you can opt for the services offered by our local specialists.

Dubai special economic zones where you can open an onshore company

International investors can register an onshore company in Dubai, especially in economic zones, and benefit from the present advantages. Here are some of the areas where you can carry out your activities owning an onshore company in Dubai:

  • Dubai Multi-Commodities Center (DMCC) is one of the largest free trade zones in Dubai. Over 10,000 companies, including startups, are already registered here. Investors can benefit from advantageous setup business packages, including for the onshore structure.
  • Dubai Silicon Oasis – IFZA is one of the most dynamic special economic zones of Dubai, and foreign investors can opt for the multitude of business facilities and top technologies when opening an onshore company.
  • Dubai CommerCity – Recently opened, Dubai CommerCity is aimed at those who want to work in sectors such as consulting, trading, media, logistics, and more. You can open an onshore company in Dubai CommerCity.
  • Dubai China Center Free Zone – This business zone was also recently opened and offers cost-effective company registration. With a strategic location, the Dubai China Center Free Zone offers clients a variety of business facilities and networking opportunities for owners of onshore companies.

We invite you to learn more about the advantages of free zones in Dubai and to discuss with our local company formation representatives. We can guide you regarding the formalities related to opening an onshore company in Dubai.

FAQ about onshore companies in Dubai

Our specialists often receive questions about onshore companies in Dubai and registration formalities. Therefore, we invite you to discover the following questions and answers to help you get an idea of this type of company, before collaborating with our specialists:

What is an onshore company and how can it be established in Dubai?

An onshore company can be used throughout the UAE, but also abroad, and under certain conditions mentioned by Company Law. For example, a UAE national is needed to own 51% of the onshore company. Details about mainland company formation in Dubai can be found at our specialists.

What kind of structure is suitable for onshore companies in Dubai?

If you are interested in business setup in Dubai mainland and choose onshore companies, then you should know that a limited liability company is the most suitable structure. You can also choose branches and subsidiaries in Dubai. Find out from our local agents what mainland business setup involves in Dubai.

Can I register an onshore company in Dubai free zones?

Yes, if you are interested in mainland company formation in Dubai and more precisely onshore companies, you can think of free zone companies where you can benefit from 100% ownership.

Can I have activities with an onshore company in Dubai and outside free zones?

Onshore companies registered in Dubai free zones must develop their activities only there. Only onshore companies in mainland Dubai can have operations throughout the UAE and abroad. Talk to our agents about business setup in Dubai mainland.

Do you need business licenses to activate an onshore company in Dubai?

Yes, depending on the activities you want to develop you need to apply for a specific license. You can rely on the help of our local agents if you want to obtain a business license. They can handle all the formalities involved in the process.

What documents are required for onshore company registration in Dubai?

Articles of Association is the set of documents for the incorporation of a company in Dubai. These must include complete information about the shareholders, activities, place of business, management rules, etc.

Is a local agent needed for an onshore company in Dubai?

Yes, according to Company Law, if you want to open a business in Dubai, in this case, onshore, a local agent is needed to take care of its registration. We remind you that our team of specialists can provide you with more details in this regard and I can represent your company in Dubai.

Do onshore companies in Dubai need bank accounts?

Yes, share capital must be deposited in a bank account in Dubai. The opening of such an account is quite simple, and the shareholders must present the personal documents, but also the constitutive documents of the onshore company.

Is it necessary to register for VAT purposes for onshore companies in Dubai?

Mainland business setup in Dubai involves registration for VAT payment, and an identification code will be issued for this purpose. You can discuss the VAT registration formalities with our specialists in company formation in Dubai.

Is onshore company training in Dubai a complicated process?

Registering an onshore company in Dubai is quite simple and fast. But to benefit from the desired results, it is advisable to turn to our specialists. They can take care of all the formalities, the drafting of the documents, the application for licenses, and the registration for the payment of taxes. You can find out more about how to set up a company in Dubai by contacting our team.

Why work with our specialists in Dubai

Onshore companies in Dubai can be registered relatively quickly and easily with the help of specialists in the field. Foreigners who want to develop their activities in the UAE and abroad can opt for the onshore company and the simple way to operate on the market. But it is advisable to consider dedicated help, in this case, to ensure that the formalities are followed leisurely. Here you can rely on our local agents’ professionalism and their field experience. We are looking for the best solutions for our clients in order to benefit from the start of activities as quickly as possible. Below are some facts about UAE’s economy, if you would like to set up a company in Dubai and need to know how is the country positioned from this point of view:

  • A 3.7% increase in GDP was recorded in the UAE, in the first six months of 2023.
  • The economic growth recorded in 2022 in the UAE was approximately 7.9%.
  • Around USD 599 billion was the UAE’s foreign trade in 2022.
  • The UAE wants to reach double the current economic growth by 2031.

For onshore company incorporation, we invite you to contact our company formation agents in Dubai. We can help foreigners start a business in Dubai by managing the formalities. You can also contact us if interested in immigration to Dubai.