Starting a Business with 20,000 Dirhams in the UAE: Opportunities and Best Practices

Starting a small business with a modest budget of 20,000 Dirhams in the UAE is a feasible and exciting proposition, especially in the current market climate. Whether you opt for an online store, freelance services, or a small food venture, the opportunities are vast and varied. This article provides a comprehensive guide to help you navigate the process, ensuring a fruitful and successful venture.

Dubai Mainland Business Setup

Dubai offers a myriad of investment opportunities for international investors and startup enthusiasts. The government's supportive policies, combined with the city's rapidly growing economy and future-centric programs, make Dubai an attractive destination for business establishment. Dubai Mainland is a popular choice due to its accessibility via world-class infrastructure and transportation, making it easier to start and operate your business.

Why Dubai?

Visionary leadership Future-centric programs Exponential economic growth Global gateway and financial hub 100% foreign ownership Top-class infrastructure and transportation No minimum capital required for companies No annual auditing Wider scope of business No restrictions on trading with other mainland companies Enhanced presence in the local market

Benefits of Setting Up a Company in Dubai Mainland

Setting up a company in Dubai Mainland offers numerous advantages, including:

No restrictions on multi-currency 100% corporate tax exemption Location flexibility for operating offices Affordable rents for office spaces No annual auditing requirements No minimum capital requirement for companies More business types permitted No restrictions on trading with other mainland companies Enhanced presence in the local market

Types of Licenses for Mainland Companies

A mainland license, also known as an onshore license, allows your business to operate both within the UAE and internationally. To start your business, you need to obtain a trade license from the Department of Economic Development (DED). These licenses can be categorized into:

Commercial Licenses: Cover all types of trading activities Professional Licenses: For professional businesses like carpentry, artisanship, printing, repair services, beauty salons, consultancies, and more Industrial Licenses: For activities related to manufacturing and industrial processes

Steps to Setup a Company in Dubai Mainland

Select the business activity and choose a suitable trade name in accordance with Dubai laws. Identify a suitable location in Dubai to operate your business. Choose from various business entity types, such as a Limited Liability Company (LLC), sole establishment, branch, civil company, or representative office. Get the necessary initial approvals, including DED approvals, MOA notarizations, and Memorandum of Association. Set up corporate bank accounts and secure office space. Obtain the establishment card and apply for residence visas.

Getting Your Business Up and Running in Dubai

Once you have completed all the necessary legal paperwork, setting up and getting your business up and running in Dubai should not take longer than a week. However, various factors need to be considered when establishing a company in Dubai, including:

Selecting the Location

Mainland - Dubai, Sharjah, Abu Dhabi, Ajman Free zones - Dubai, Sharjah, Abu Dhabi, Ajman, Ras Al Khaimah, Fujairah Offshore - Jebel Ali, Ras Al Khaimah

Choosing the right jurisdiction depends on the nature of your business. The Department of Economic Development (DED) is responsible for classifying and permitting business activities. Free zone and offshore setups have different regulations compared to mainland businesses.

Registering the Business and Obtaining Trade Licenses

All approved businesses must register with the Department of Economic Development (DED). The business name should comply with DED standards. Trade names serve as identifiers for your business. The registration process typically takes about three days, and the trademark is valid for six months.

Finding Local Sponsors

To start a Limited Liability Company (LLC) in Dubai Mainland, you need to find a reliable local sponsor who can become your business partner. Local sponsors, corporate sponsors, and local service agents can provide necessary support. They ensure compliance with local laws and help navigate the complex business environment.

The local sponsor will hold 51% shares and liabilities. They can transfer the power of attorney to their foreign partners in exchange for fees. Corporate sponsors operate similarly, while local service agents represent professionals and assist with administrative tasks without holding shares or liabilities.