How to Set Up an Entity in the United Arab Emirates (Dubai Internet City)

Establishing a business entity in the United Arab Emirates (UAE), and specifically within Dubai Internet City (DIC), is a compelling choice for technology and digital firms targeting the Middle East, Africa, and South Asia. Dubai Internet City is one of the UAE’s premier free zones designed to attract information and communications technology (ICT) companies with world-class infrastructure, ecosystem support, and strategic access to global markets.

The incorporation process in Dubai Internet City is generally efficient and structured, benefiting from the UAE’s broader efforts to streamline business setup across mainland and free zones. That said, entrepreneurs must navigate specific regulatory milestones such as name approval, license issuance, and compliance with UAE corporate tax and VAT requirements.

Key benefits of forming an entity here include 100% foreign ownership, tax incentives, and access to Dubai’s innovation ecosystem. Main challenges typically relate to documentation, understanding local tax compliance (including the UAE’s evolving corporate tax regime), and securing suitable office space within the free zone.

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?

Opening an entity in the UAE means legally registering a business with a relevant licensing authority to obtain a trade license, establish corporate status, and legally carry out commercial activities within the UAE.

Entity overview in the United Arab Emirates

Below is an entity overview of what it means to open an entity in Dubai Internet City:

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

Step 1: Choose the right structure

In Dubai Internet City, the most common form is a Free Zone Limited Liability Company (FZ-LLC) or Free Zone Establishment (FZE). An FZ-LLC suits companies with multiple shareholders, while an FZE is for a single owner. Both offer limited liability and allow 100 % foreign ownership. Alternatively, you may consider establishing a branch of an existing foreign corporation if you want to retain the parent company’s legal identity.

Step 2: Verify business name availability

Choose a unique trade name in line with DDA and UAE naming conventions. Check your business name availability using the online tools available. Names must avoid offensive terms, match the activity, and not conflict with existing registrations.

Step 3: Prepare incorporation documents

Prepare the following documents (exact requirements vary by entity type):

• Application Form
• Valid passport copies of Director(s) and General Manager with Residence Visa Page (if any)
• Resolution for the Incorporation of an FZ-LLC
• Company Incorporation Certificate – For Corporate Member(s)
• Certificate of Continuity or Existence or Good Standing – For Corporate Member(s)
• MoA and AoA of Parent Company for Corporate Member(s)
• NOC from external authorities according to the Licensing Categories Decision (LCD), Article 08. (If applicable)
• Declaration of Appointment as General Manager (applicable if holds a valid visa)
• Power of Attorney for Legal Representative/ Negotiator (if any), accompanied by a passport copy of the legal representative

Step 4: Register with the Dubai Development Authority

Submit your application, documents, and fees through the DDA licensing portal. Upon approval, DDA issues a trade license and Establishment Card, allowing the company to operate within Dubai Internet City.

Step 5: Register for tax and social security

Register with the Federal Tax Authority (FTA) for corporate tax and VAT if your business meets thresholds (VAT registration is mandatory if turnover exceeds AED 375,000). Social security registration applies if you hire a UAE national.

Step 6: Open a corporate bank account

Open a corporate bank account with a UAE bank. Banks require corporate documents, a license, passport copies, and proof of business activities. Local banking is typical and generally necessary for operational transactions.

Step 7: Set up payroll and employment compliance

Once licensed, register with relevant employment authorities, draft compliant employment contracts, and set up payroll systems in accordance with UAE labor law and visa rules for sponsored employees.

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Post-registration obligations

After incorporation, companies in the UAE must maintain compliance:

• Tax and financial reporting: File corporate tax returns with the Federal Tax Authority and VAT returns if registered. Maintain financial statements under International Financial Reporting Standards (IFRS) as applicable
• Corporate registers: Keep records of shareholders, directors, and beneficial owners; update DDA of any changes
• Compliance tracking: Monitor deadlines for tax filings, license renewals, and visa quotas
• Licenses and renewals: Renew your business license annually with DDA and ensure office lease compliance
• Recordkeeping: Maintain accounting, payroll, and transaction records for the required retention period (commonly 5+ years)
• Employment law compliance: Adhere to labor, benefits, social security, and data protection regulations

Taxes and financial considerations

You're responsible for:

• Corporate income tax: Standard federal corporate tax at 9% on profits exceeding AED 375,000; income below this may be exempt. Free-zone entities may qualify for tax incentives if conditions are met
• VAT/GST: Standard VAT rate 5%, with registration required if turnover exceeds AED 375,000
• Payroll/social contributions: Employer obligations include end-of-service gratuity and contributions for UAE nationals under social security schemes; expatriate employees aren’t subject to social insurance contributions
• Accounting standards: Financial statements prepared under IFRS are typically required for corporate tax compliance and audit purposes

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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?
Typically, entity setup in Dubai Internet City takes 3–8 weeks, depending on documentation, approvals, and licensing processing. Find out how long setup takes with our Entity Setup Calculator.

What is the minimum capital required?
Minimum authorized capital is typically AED 50,000 (≈ $13,600 USD) but varies by activity and package.

Can foreign companies own 100 % of an entity in the United Arab Emirates?
Yes, free-zone entities in Dubai Internet City allow 100 % foreign ownership.

Do I need a local director or representative?
No, free-zone companies do not require a UAE national director or shareholder, though appointed managers must meet DDA requirements.

How much does it cost to register an entity?
Entity setup costs in Dubai Internet City generally range from AED 18,000–60,000, including licenses and service packages. Find out the setup cost with our Entity Setup Calculator.

Can Deel help me open an entity in the United Arab Emirates?
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.