How to Set Up an Entity in the United Arab Emirates (Abu Dhabi)

Setting up a legal entity in Abu Dhabi is appealing for companies looking for full UAE market access, regulatory stability, and strong government support. Unlike popular Dubai free zones such as Meydan, DMCC, or Dubai Internet City—which offer quick, low-friction setups but restrict onshore commercial activity—an Abu Dhabi mainland entity allows you to operate across the entire UAE, engage directly with local clients, and participate in government tenders without additional approvals.

The formation process in Abu Dhabi is generally streamlined but still involves several coordinated steps, from selecting business activities to obtaining licenses, tax registration, and immigration clearances. The main challenges include navigating multi-layered approvals and ensuring documentation meets federal and emirate requirements. Still, the benefits are substantial: broad operational flexibility, stronger onshore access, and long-term stability under the UAE’s modernized commercial laws.

Disclaimer: This content is for informational purposes only and does not constitute legal, tax, or financial advice. Always consult official sources before acting.

What does “opening an entity” mean in the United Arab Emirates (Abu Dhabi)?

Opening an entity in Abu Dhabi means legally establishing a business under UAE law, registering it with the relevant government authority, and obtaining the appropriate trade license that allows you to operate commercially within the emirate. Entities can be structured as mainland companies, free zone companies, branches, or representative offices, each with distinct regulatory frameworks and market access rights.

Entity overview in the United Arab Emirates (Abu Dhabi)

Here is a summary of the key features of opening an entity in Abu Dhabi:

Step-by-step guide: How to open an entity in the United Arab Emirates (Abu Dhabi)

Step 1: Choose the right structure

Foreign investors typically choose between a mainland LLC, a free zone company, a branch office, or a representative office in Abu Dhabi. A mainland LLC provides broad operational rights across the UAE, while free zone companies offer simplified setup but more limited direct onshore access. Branch offices allow the foreign parent to operate directly, whereas representative offices are restricted to promotional or liaison activities.

Step 2: Verify business name availability

Trade names must be unique, follow UAE naming rules, and include the correct legal form. Availability and reservation can be completed online through the ADDED/TAMM portal, which manages trade name searches and initial approvals.

Step 3: Prepare incorporation documents

Typical documents include:

• Memorandum of Association (MOA) or Articles of Association (AOA)
• Passport copies and identification for shareholders and directors
• Proof of address and contact details
• Office lease or registered commercial address
• Any required no-objection certificates for regulated activities

Step 4: Register with the Department of Economic Development / Free Zone Authority

Submit incorporation documents through TAMM, Abu Dhabi’s unified government services portal, which processes licensing on behalf of the ADDED. Free zone companies instead submit through their respective authorities. After approvals and fee payment, you receive the Trade License and Certificate of Incorporation, confirming your company’s legal status.

Step 5: Register for tax and social security

Corporate tax and VAT registration must be completed through the Federal Tax Authority (FTA) using the EmaraTax platform. VAT becomes mandatory once your taxable supplies exceed the threshold. There is no personal income tax, but employer obligations apply under federal labor law.

Step 6: Open a corporate bank account

Banks require your trade license, incorporation certificate, MOA/AOA, and proof of address. Account opening typically takes 1–3 weeks, depending on the bank’s due diligence requirements.

Step 7: Set up payroll and employment compliance

Register as an employer with the Ministry of Human Resources and Emiratisation (MOHRE), issue compliant employment contracts, enroll employees in the Wage Protection System (WPS), and ensure visas and work permits follow UAE immigration rules.

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Post-registration obligations

After incorporation, companies in Abu Dhabi must stay compliant with local governance, tax, and employment laws. Typical requirements include:

• Tax and financial reporting: File corporate income tax and VAT returns under the schedules set by the FTA, typically quarterly or annually, using Accounting Standards and Interaction with Corporate Tax (IFRS) for financial statements.
• Corporate registers: Maintain updated records of directors, shareholders, and beneficial owners, reporting any changes to ADDED or the relevant free zone authority.
• Compliance tracking: Monitor all tax, licensing, and filing deadlines through a compliance calendar or automated system to avoid penalties.
• Licenses and renewals: Renew trade licenses, activity permits, or professional registrations with the relevant authorities, typically on an annual basis.
• Recordkeeping: Retain accounting, payroll, HR, and transaction records for the periods required under UAE law, ensuring availability for audits.
• Employment law compliance: Follow MOHRE rules on contracts, payroll, benefits, WPS reporting, and workplace insurance.

Taxes and financial considerations

You're responsible for:

• Corporate income tax: 0% on profits up to AED 375,000; 9% above the threshold
• VAT: 5% VAT applies when annual revenue exceeds AED 375,000
• Payroll/social contributions: No personal income tax; employer obligations under UAE labor law (WPS, insurance, end-of-service benefits)
• Accounting standards: International Financial Reporting Standards (IFRS) are the standard for corporate financial reporting

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Expand internationally with Deel

Whether you’re hiring through an EOR or establishing your own local entity, Deel’s all-in-one platform gives you everything you need to expand into the United Kingdom—quickly, compliantly, and with confidence. From market entry to ongoing operations, Deel helps you hire, onboard, and manage teams seamlessly from day one.

With Deel, you can:

• Test new regions using Deel’s local entities through our Employer of Record service—hire employees compliantly, delegate payroll and taxes, and access localized employment contracts.
• Open entities with Deel Entity Setup, where our team manages everything—from incorporation and tax registration to coordination with local experts.
• Centralize your compliance and records with Deel Entity Management, including automated filings, calendar reminders, and visibility across all entities.
• Integrate with Deel Payroll and Deel HR for compliant payments, benefits, and workforce oversight—all in one platform.

For companies transitioning from the EOR model to owned entities, Deel ensures a smooth handover and consistent compliance every step of the way. Enter new markets, onboard talent, and manage your global workforce—all through one unified platform.

FAQs

How long does it take to open an entity in the United Arab Emirates (Abu Dhabi)?
Typically 2–6 weeks. Find out how long setup takes with our Entity Setup Calculator.

What is the minimum capital required?
Generally not required for most Abu Dhabi LLCs.

Can foreign companies own 100% of an entity in the United Arab Emirates (Abu Dhabi)?
Yes, 100% foreign ownership is permitted for many commercial and industrial activities.

Do I need a local director or representative?
Not for most business activities, though certain regulated sectors may still require local involvement.

How much does it cost to register an entity?
AED 10,000–50,000+, including license fees and government charges. Find out the setup cost with our Entity Setup Calculator.

Can Deel help me open an entity in the United Arab Emirates (Abu Dhabi)?
Yes. Deel Entity Setup manages the end-to-end process—from registration to payroll compliance—in over 100 countries. Deel’s local experts handle documentation, filings, and legal requirements on your behalf.

Does Deel offer ongoing compliance and payroll support?
Yes. Deel offers both managed services and self-service tools to help you stay compliant.

If you’re using Deel Entity Management, Maintenance, EOR, or Payroll, our team handles payroll, benefits, filings, and compliance obligations on your behalf.

For teams managing their own entities, Deel Compliance Hub makes staying compliant simple by providing real-time regulatory updates, risk alerts, and workforce insights across 150+ countries. Proactively manage compliance with our Compliance Monitor, Workforce Insights, and an AI-powered Worker Classifier, staying ahead of changing employment laws.