If you look at the economic growth trajectory of the United Arab Emirates, you see exponential growth. The UAE may have been once known as a major oil exporter of the world but has now transformed itself into a major business hub around the globe.

Almost every other major international company has a regional headquarters in UAE and there are thousands of home-grown businesses and startups in UAE on top of them. This is thanks to the UAE’s strong economy, great infrastructure, and friendly almost nonexistent tax regulations.

This makes UAE an ideal country to start your own online business and, in this guide, we will not only show you why but we will also guide you through the whole process of setting up your online business in the UAE, including details about the documentation and the costs.

Advantages of starting an online business in UAE

As mentioned before, UAE has many things going for it in terms of its business sector, which creates many advantages for existing and new businesses, both that are operating locally and internationally like an online business. Here are some of the key advantages.

Its location on the map

In terms of its geographic location the UAE has hit the jackpot as it is located in the middle of the larger Asian continent and the African and European continents. Not only is it a great physical location but time zone-wise it is perfect for an online business that wants to conduct its business internationally.

When the work day starts in the UAE it is close to ending in the Americas and starting in Asia. Similarly, as the day progresses the workday starts in Europe and Africa, and this way it creates a great cycle for businesses in UAE to interact with clients and partners in other hemispheres.

Great Tax Policy

If you go back a few years, there was almost no tax in the UAE, but since then they have introduced corporate and value-added tax, but at very low rates of only 9% and 5% respectively. Even then they have made exceptions for certain businesses and certain zones where companies don’t have to pay taxes.

The Government Incentives

UAE is on a mission to diversify its economy and rely less and less on the export of oil, its main source of income. As such it has been giving more and more incentives to foreign businesses and companies and attracting large amounts of outside investments through incentives like free zones and lax regulations.

Thriving Business Sector

When a country already has a thriving business sector it means that its economy and infrastructure can support new and existing businesses and that there will be no shortage of expert help, should you need it, when starting your own online business in UAE.

Availability of Skilled Professionals

Another advantage of having a thriving business sector is ready access to a skilled workforce which is essential for running an online business. Not only do you need IT professionals and coders etc., but other staff as well like receptionists, office managers, and consultants and UAE has all of them

Great Infrastructure

Whether on the mainland or in the free zones, UAE has excellent infrastructure not just for living but also for running your business. In terms of living and working standards, it has infrastructure that is on par with most first-world countries and as such it can easily support small and large businesses.

Best locations to start an online business in UAE

In terms of selecting a location to set up your online business, you not only need to consider things like cost and accessibility but also if you want your business to be on the mainland or in one of the free zones. On the mainland not only do you have to get a sponsor but you are also more likely to pay taxes.

Free zones on the other hand not only let you own your business entirely but you also don’t need to have a sponsor and of course most free zones have no corporate or value-added taxes, with few exceptions. This makes them and place to set up your online business and here are a few options to look at.

• Dubai Internet City (DIC)
• Sharjah Media City (Shams)
• Dubai Silicon Oasis (DSO)
• Fujairah Creative Zone (FCZ)
• Dubai Science Park (DSP)
• Abu Dhabi Media Free Zone (Media Zone Authority)

These are just some of the examples to choose from, as there are plenty more and if you are looking to set up your online business on the mainland then you can look at either Sheikh Zayed Road or Jumeirah Lake Towers (JLT) to name a few.

Documentation needed to start an online business in the UAE

When it comes to documentation needed for starting an online business, there are a number of requirements that you need to meet, and here is a list of the main ones.

• Copies of valid passports
• Copies of visas (If applicable)
• Trade License
• A detailed Business plan
• A Lease Agreement
• Financial Details including Corporate Bank Account
• No Objection Certificate (NOC) from your sponsor (If applicable)
• Memorandum of Association (MOA) (If applicable)

How to start an online business in UAE

Now that you have all the documents and you know the location you want to go with, all that is left is to start the application process for your online business, this means selecting a name, getting a business license, etc. Here are the steps that you need to follow.

• A Name for Your Business: This is the very first thing you do when starting an online business. All you need to do is make sure the name does not infringe on some other company’s trademark and meets the standards set by the UAE government.
• Business Structure: Next you need to decide what kind of corporate entity your business is. It is a sole proprietorship, a limited liability corporation (LLC), or some other business structure.
• Articles of Association: If you are starting your business on the mainland then you will need things like a No Objection Certificate (NOC) from your sponsor and a Memorandum of Association (MOA).
• Corporate Bank Account: You need to have a corporate bank account with the necessary funds to start your online business, as well as a place to manage your business expenses.
• Trade License: Once you have all your business details finalized you need to apply for a trade license, which means filing an application and doing all the necessary paperwork.