What is a Mainland Company in Dubai and Why Should You Set Up One? [8 easy steps in 2024]

Table of contents

• What is a Mainland Company in Dubai?
• Benefits of Setting Up a Mainland Company in Dubai
• Setting Up a Business in Dubai: The Process
• 9% Corporation Tax in Dubai
• Set up with Strive Consultants

Dubai, known for its strategic location, vibrant economy, and investor-friendly policies, is a prime destination for entrepreneurs and businesses worldwide. When considering business formation in Dubai, one of the most popular options is setting up a mainland company. This article will explore the benefits of setting up a mainland company in Dubai, the process of setting up a business in Dubai, and recent changes in regulations, including the 100% foreign ownership and the introduction of a 9% corporation tax.

What is a Mainland Company in Dubai?

A mainland company in Dubai is an onshore entity licensed by the Department of Economic Development (DED) in Dubai. Unlike free zone companies, mainland companies can operate within the local market and conduct business with other mainland companies in Dubai. They are not restricted by geographical boundaries within the UAE, allowing them to trade anywhere in Dubai, across the UAE, and internationally.

Benefits of Setting Up a Mainland Company in Dubai

1. 100% Foreign Ownership: One of the most significant recent changes is that mainland companies in Dubai can now be 100% foreign-owned. This change has made Dubai even more attractive to foreign investors, as they can have complete control over their business operations without needing a local sponsor.

2. Wide Range of Business Activities: Mainland companies can engage in a variety of business activities, including commercial, professional, and industrial activities. This flexibility allows businesses to diversify their operations and tap into different markets.

3. Access to the Local Market: Unlike free zone companies, mainland companies can trade directly within the local UAE market. This access provides a vast customer base and numerous business opportunities.

4. No Limitations on Office Space: Mainland companies are not restricted to specific areas and can set up their offices anywhere in Dubai. This freedom allows businesses to choose strategic locations that best suit their needs.

5. Government Contracts: Mainland companies can bid for lucrative government contracts, which are often not available to free zone companies. This access to government projects can significantly boost a company’s growth and reputation.

6. No Currency Restrictions: Mainland companies in Dubai can freely repatriate capital and profits, facilitating smooth international transactions.

Setting Up a Business in Dubai: The Process

1. Choose a Business Activity: Determine the type of business activity you want to engage in, as this will influence the licensing requirements and other legal obligations.

2. Select a Legal Structure: Decide on the legal structure of your business, such as a sole proprietorship, partnership, or limited liability company (LLC). The structure will affect your liability and operational framework.

3. Reserve a Trade Name: Choose a unique trade name for your company and have it approved by the DED. The name should reflect the nature of your business and comply with naming conventions in Dubai.

4. Apply for Initial Approval: Obtain initial approval from the DED to confirm that your business activity and trade name are acceptable.

5. Draft and Sign MOA: Draft a Memorandum of Association (MOA) outlining the ownership structure and operational guidelines of your company. Sign the MOA in the presence of a notary public.

6. Lease Office Space: Secure a physical office space in Dubai, as this is a mandatory requirement for mainland companies. Obtain a tenancy contract and Ejari certificate.

7. Submit Documents and Pay Fees: Submit all required documents to the DED, including the MOA, tenancy contract, and other necessary forms. Pay the applicable licensing fees.

8. Obtain Business License: Once your application is processed and approved, you will receive your business license from the DED, allowing you to commence operations.

9% Corporation Tax in Dubai

As part of ongoing economic reforms, Dubai has introduced a 9% corporation tax on business profits. This tax rate is competitive compared to global standards and aims to contribute to the development of the region while maintaining Dubai’s attractiveness as a business hub. Companies must ensure compliance with this new regulation by maintaining accurate financial records and filing timely tax returns.

Set up with Strive Consultants

Setting up a mainland company in Dubai offers numerous benefits, including 100% foreign ownership, access to the local market, and the ability to engage in a wide range of business activities. With its strategic location, business-friendly environment, and recent regulatory changes, Dubai continues to be an ideal destination for business formation. Understanding the process and staying informed about new regulations, such as the 9% corporation tax, will help ensure a smooth and successful business setup in Dubai.

By leveraging the benefits of setting up a mainland company in Dubai, entrepreneurs and businesses can unlock new opportunities and achieve growth in one of the world’s most dynamic business landscapes.

Navigating the process of setting up a mainland company in Dubai can be complex, but you don’t have to do it alone. At Strive Consultants, we have extensive experience and in-depth knowledge of Dubai’s business landscape, and we are here to help. From choosing the right business activity to ensuring compliance with all legal requirements, we provide comprehensive support at every step. Partner with us at Strive Consultants to streamline your business formation in Dubai and take full advantage of the benefits that a mainland company offers. Contact us today to get started on your journey to success in Dubai’s thriving market.