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Cost of a business license in Dubai Free Zone

١٣ أبريل Cost of a business license in Dubai Free Zone

What is the cost of a business license in the Dubai Free Zone? The Dubai Free Zone is one of the most prominent investment destinations in the world, providing an ideal environment for businesses thanks to attractive tax facilities and exemptions. One of the basic steps to setting up any business in this zone is obtaining a business license, the cost of which varies based on several factors such as the type of business activity, office space, and services provided. In this article, we will review in detail the costs of a business license in the Dubai Free Zone , in addition to the factors affecting these costs and the procedures required to obtain them, which helps investors make informed decisions when starting their businesses in this dynamic destination.

Cost

Cost of a business license in Dubai Free Zone

First, the type of business activity must be determined. Fees vary depending on the nature of the activity, as some activities require special licenses or specific categories of licenses, which affects the cost. The cost of a commercial license in Dubai is affected by several main factors, including:

  1. Office Space: Most business licenses require a physical office, and the cost varies depending on the size of the office and its location in the free zone. The larger the space, the higher the cost.
  2. Government fees: These include fees set by local authorities which may include license fees, registration fees, and annual renewal fees.
  3. Additional Services: Investors may require additional services such as legal consulting services or accounting services, which increases the overall costs.
  4. Number of shareholders: Costs vary depending on the number of shareholders or partners in the company, as there may be additional fees for each partner.
  5. Required Documents: Costs include the costs of preparing and processing the documents required to obtain the license, such as contracts and legal documents.
  6. License period: Costs also depend on the duration of the license, as licensing for longer periods may come at a higher cost.

Understanding these factors helps investors plan better financially when setting up their business in Dubai Free Zone.

Types of commercial licenses in Dubai

In Dubai, there are several types of business licenses that investors can choose from depending on the type of their business activity. Here are the most prominent types of business licenses in Dubai:

  1. General Commercial License: Granted to practice a variety of non-specific commercial activities.
  2. Industrial license: given to factories and companies that work in the production and development of products.
  3. Commercial Services License: Used for establishments that provide various services, such as consulting or facilities.
  4. Professional License: Granted to professionals such as doctors, engineers and lawyers, who provide their services individually or within institutions.
  5. Tourism license: granted to companies working in the field of tourism, such as travel agencies and hotels.
  6. E-commerce license: intended for projects that operate mainly online.
  7. Free Zone Business License: Given to companies established in free zones, it provides special benefits such as tax exemption and full foreign ownership.

The requirements for obtaining each type of license vary, and it is advisable to seek the help of a consulting service such as Itqan to ensure that all legal procedures and necessary requirements are met.

Steps to obtain a commercial license in the Dubai Free Zone

First, the type of business activity must be determined before starting the procedures. The investor must determine the type of business activity he wishes to practice, as this determines the type of license required. Here are the steps to obtain a commercial license in the Dubai Free Zone:

  1. Choosing the free zone: The investor can choose the appropriate free zone according to the nature of his activity, such as Dubai South or Dubai Airport Free Zone.
  2. Submitting a license application: The commercial license application form must be completed and submitted to the competent authorities in the selected free zone.
  3. Preparing the required documents: The investor must prepare the necessary documents, such as the original passport, a copy of the ID, a copy of the office lease contract, and the necessary approvals from the relevant authorities, if required.
  4. Payment of fees: The investor must pay the fees required to obtain the license, which vary according to the type of activity and the size of the office.
  5. Security clearance: In some cases, security clearance may be required, especially for sensitive activities.
  6. Receiving the license: After completing all procedures and paying the fees, the authorities will issue the commercial license, and the investor can receive it.
  7. Opening a bank account: After obtaining the license, it is advisable to open a business bank account in a local bank to facilitate financial transactions.
  8. Employee Registration: If there are employees, they must be registered and work visas must be obtained for them.

By completing these steps, the investor will have completed the procedures for obtaining a commercial license in the Dubai Free Zone.

Advantages of a commercial license in the Dubai Free Zone

The commercial license in the free zones in Dubai has a number of advantages that make it attractive to investors. The most prominent of these advantages are:

  1. Tax Exemption: Companies in free zones are exempt from income tax, which helps increase profits and enhance competitiveness.
  2. 100% Foreign Ownership: Foreign investors are allowed to fully own companies without the need for a local partner, giving them greater freedom to run their business.
  3. Ease of establishment: The procedures for obtaining a commercial license are fast and easy, enabling investors to start their businesses quickly.
  4. No restrictions on profit repatriation: Profits and investment returns are allowed to be repatriated abroad without restrictions, which enhances the attractiveness of investing in the region.
  5. Convenient business environment: Free zones provide modern infrastructure and advanced facilities that support businesses, facilitating daily operations.
  6. Speed ​​up visa procedures: Companies can easily and quickly obtain work visas for employees, enhancing the ability to attract talent.
  7. Access to global markets: Free zones provide a strategic location that facilitates access to regional and international markets, supporting trade and expansion.
  8. Business flexibility: Investors can practice various activities within the same license, which saves them additional costs of obtaining new licenses.
  9. Government support services: Local authorities in the free zones provide ongoing support to investors, including advice and assistance with legal procedures.

These features make Dubai Free Zone an ideal destination for investors looking to set up their businesses and expand their activities in a favourable environment.

Cost

Conditions for renewing a commercial license in the Dubai Free Zone

The process of renewing a commercial license in the Dubai Free Zone requires adherence to a number of conditions and procedures, including:

  1. Submitting a renewal application: The license holder must submit an official application to renew the commercial license within a reasonable period of time before its expiration, usually one month before the license expiration date.
  2. Payment of fees: The renewal fees specified by the competent authority must be paid, which may vary depending on the type of business activity.
  3. Submitting the required documents: The investor must submit a set of documents, which may include a copy of the current trade license. A copy of the investor’s passport and residency. And the updated office lease contract, if there are any changes.
  4. Ensuring compliance with standards: The company must comply with all applicable laws and regulations in the free zone, including laws related to taxes and business practices.
  5. Update Information: If there are any changes to the registered information, such as a change in address or the addition of new partners, this information must be updated in the renewal application.
  6. Obtaining approvals from relevant authorities: In some cases, it may be necessary to obtain approvals from other authorities, such as the Ministry of Economy or other regulatory authorities, depending on the type of activity.
  7. Submitting a financial report: Sometimes, companies may be required to submit financial reports or a financial audit when renewing their license, especially for larger companies.

By following these terms and procedures, investors can easily renew their trade license and ensure the continuity of their business in the Dubai Free Zone.

In conclusion, the cost of a Dubai free zone business license is a crucial factor that influences investors’ decisions when starting their businesses in this dynamic environment. By understanding the factors that affect the cost, such as the type of activity, office space, and government fees, investors can make informed decisions that fit their budgets and business goals. Taking advantage of tax exemptions and full foreign ownership also enhances the attractiveness of investing in these areas. Therefore, investors are advised to plan well and seek expert guidance to ensure the success and sustainable growth of their businesses in the UAE market.

Frequently asked questions about the cost of a commercial license in the free zone

Are there any discounts or special offers on the cost of the business license?

Some free zones may offer special offers or discounts for certain businesses or new companies, so it is advisable to inquire directly with the relevant free zone.

How long does it take to get a free zone business license?

The process of obtaining a commercial license usually takes from several days to two weeks, depending on the speed of completing the documents and paying the fees.

Are there any other employee fees when obtaining a business license?

Yes, you may need to pay additional fees for work visas for employees, which include registration fees and health insurance.