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Doing Business in Dubai in 2024

Key Takeaways:

  • Dubai is planning to double its GDP by 2033.
  • Branch offices and subsidiaries can be set up in Dubai with the help of a Local Service Agent.
  • Free zones in and around Dubai allow for tax-free business and 100% foreign ownership.

Are you looking to learn all you can about doing business in Dubai? In the past few decades, Dubai has made its name known internationally through a focus on tourism and luxury. Its incredible growth has been fueled by the oil revenues of the Emirate of Dubai, and it now features the Burj Khalifa, the world’s tallest building at 2,717 feet (828m). The city is home to just over three million of the UAE’s 10.243 million people. The UAE’s economy is currently on an upward trend with inflation expected to drop and the country’s GDP predicted to grow by 4% in 2024. With all this good news, international firms are expanding into Dubai at an incredible rate and it might well be time that your company does the same.

Overview of the Dubai Economy

The governments of the UAE, the Emirate of Dubai, and the city have been pushing economic development policies for decades to build Dubai into what it is today. These have largely focused on investing funds from oil reserves into the creation of a diverse and more robust economy. And it has paid off.

Dubai has transformed into a global city full of skyscrapers on the shining coat of the Persian Gulf. Dubai’s per capita GDP was estimated to reach $48,882 in 2023, also the year that an ambitious new plan was laid out for the city. Called D33 or the Dubai Economic Agenda, this plan represents sustainable development targets for 2033, which is also 200 years from the city’s founding. Its biggest goal is to double GDP in ten years. Other goals include making Dubai a Top 5 logistics hub, a Top 4 financial hub, and a Top 3 tourist destination, as well as doubling the volume of foreign trade. Dubai is also courting unicorns up business incubators that will hopefully support 30 firms to grow to values of over $1 billion. If this is possible, it will turn Dubai into one of the leading cities in the world.

The Emirate’s GDP grew by 3.3% in the first nine months of 2023, and this growth is projected to reach 4% in 2024. Last year, the Dubai International Finance Center (DIFC) also posted a record number of new registrants in Dubai, with 5,533 companies registering and representing 41,597 workers. The city has been attracting business by developing an independent regulatory framework and a financial exchange, as well as lowering the cost of doing business. It seems to be working as more international firms and startups are setting up in Dubai.

Overview of Dubai Business Regulation

Companies that want to do business in Dubai have to comply with multiple laws. These regulations govern business; protect the labor, consumer, and intellectual property rights; protect health, the environment, and safety; and govern the city or free zone where the business is located. 

What’s the difference between a “mainland” and a “free zone” in the UAE? Mainland is the designation for most of the country, including Dubai and other major cities. These areas are governed as normal territory, much like they would be in other countries. Any company setting up in the mainland needs to have a UAE national as its “localpartner and that partner must own at least 51% of the company. Mainland companies need to pay corporate tax at a very low rate of 9% on earnings over $102,000. Customs duty is 5% for mainland companies as well.

Forty free zones, however, have been created in different parts of the UAE, including 28 within and near Dubai. These zones are governed by different rules and allow full foreign ownership. Companies set up in free zones don’t pay any corporate tax or customs duty on imports either. They can also directly lease or buy property in these free zones. However, exported products are assessed duly at their first port of entry even if that’s within the UAE.

Businesses need to apply for business licenses from the UAE Ministry of Economy. They must define their business activity and legal type of business, register a trade name, choose a location, and create an MOA for limited liability companies. 

Once you have a license, you must make an Ultimate Business Owner’s declaration to disclose who’s in control of the company. All legal entities must set up accounting and organize an annual audit report. Businesses of all kinds must abide by the laws of the Emirate of Dubai, and United Arab Emirates national law which can supersede Dubai law.

Benefits of Doing Business in Dubai

There are many benefits to doing business in Dubai, and some we’ve already touched on. These include such factors as:

  • Low corporate tax (9%) for mainland companies. No corporate tax for free zone companies.
  • Low contributions for social security. Employers pay just 12.5% of gross salary while employees are deducted only 5%.
  • No customs duty is applied to companies in free zones. Only 5% for mainland companies.
  • Convenient transportation and Dubai is the second-busiest airport in the world by international passenger traffic.
  • Continuous growth is projected for the future.

Downsides of Doing Business in Dubai

Doing business in Dubai, as in all locations, is not without its downsides. Some of these negative factors include:

  • Sharing business ownership with a local for mainland-located startup companies.
  • Working with VAT. Businesses need to incorporate 5% VAT into their prices.
  • Difficulty obtaining visas and work permits for foreign employees.
  • High cost of living.
  • Cultural and linguistic hurdles.

International Expansion into Dubai

If you’ve looked into the Dubai economy and feel like your company should enter the market there, you have a few different options at your disposal. 

Subsidiary Incorporation

It’s possible to incorporate a subsidiary, an essentially independent entity, in Dubai to give you access to markets in Europe, Africa, and Asia. With a subsidiary, you create a Dubai-based company that, while owned and run by the parent company, can handle its own assets and business dealings. It’s also legally responsible for everything it does in Dubai and the UAE.

To set up a subsidiary in the mainland areas, you’ll need to contact a Local Service Agent (LSA) and secure the minimum capital investment of AED 300,000. After completing the necessary paperwork and obtaining a business license, you’ll be able to do business in Dubai.

Branch Registration

Another option is to open a branch office in Dubai. A branch is not a separate legal entity from the parent company, and therefore, the parent is legally liable for its branch’s actions. A branch is also only allowed to engage in the business activities that its parent company is allowed to engage in.

To set up a branch office, you’ll need to put in most of the same paperwork to obtain a business license. You’ll also need to contract an LSA if you set up in mainland areas but this won’t be necessary in a free zone where you also wouldn’t pay any corporate tax or duty.


Two other options include hiring a Professional Employment Organization (PEO) or an Employer of Record (EOR) company to essentially outsource your HR needs. These companies know Dubai and UAE laws and working regulations and can ensure that your employees are managed in full compliance. While a PEO can handle HR functions for a registered entity, an EOR hires workers on your company’s behalf with no need to register an entity in Dubai.

Business is Booming in Dubai

With a positive economic outlook and lots of official support, the future of business in Dubai looks bright. Many logistics, tech, and service organizations are taking advantage of low taxation and a healthy business environment to move into this fast-growing city. Free zones offer even more incentives to businesses, doing away with corporate tax and duty. And as a crossroads between Europe, Africa, and Asia, Dubai might just be the perfect place to expand your business.

Dubai Business Guides

Registering a Company in Dubai

Registering a company in Dubai involves various steps, including deciding on a legal structure, reserving a company name, applying for the necessary licenses, and opening a corporate bank account. There are different jurisdictions such as mainland, free zones, and offshore, each having its own set of rules and benefits. Obtaining the services of a business setup consultant can facilitate a smooth registration process.


Should I expand my business into Dubai?

Whether or not you should expand your business in Dubai depends on many factors. Dubai’s economy is currently doing better than the US and most of Europe and this doesn’t seem like it will change anytime soon. Dubai, especially with its free zones, offers a beautiful environment for business. However, each firm has to make an informed decision on whether or not to expand into any location.

Should I register a company in Dubai?

The benefit of registering a company in Dubai is the ability to do business directly within this market. However, you either need to register in a free zone or find a local business partner who may have a controlling share of your company. Alternatives like using an EOR can also give you the option of hiring Dubai locals without having to register an entity.

cropped Milly Barker AIV Photo
Article By
Milly is an international lawyer and tech entrepreneur who has advised companies on expanding globally for over 5 years. She is an advocate of remote hiring and regularly consults on future of work matters. Milly founded RemotePad to help employers learn more about building and growing international teams.