COREDO – EU Legal & Compliance Services Expert legal consulting, financial licensing (EMI, PSP, CASP under MiCA), and AML/CFT compliance across the European Union. Headquartered in Prague, we provide seamless regulatory solutions in Germany, Poland, Lithuania, and all 27 EU member states.
Pavel Kos
05.08.2025 | 6 min read
Updated: 16.10.2026
Founders from around the world look at the UAE as a launchpad for their business - and it's no accident. But behind this interest lies not only attractive taxation: today, business registration in the UAE is a strategic tool for international trade, tax optimization, and entry into the markets of Asia, Europe, and Africa.
However, behind the outward simplicity lies a whole layer of legal, compliance, and banking nuances that can become either a growth point or a source of serious risks. Why do some companies scale and attract venture investments through Hub71 or DIFC FinTech Hive, while others face account blockages or license refusals? How to choose between mainland and free zone to retain control over your business and ensure AML compliance?
In this article, I, Nikita Veremeev, share practical strategies and experience from COREDO on registering and supporting businesses in the UAE. If you want not just to open a company, but to create a protected, scalable, and compliant structure, read to the end. Here you will find answers to questions not discussed in open sources, as well as checklists and recommendations tested in practice.
Opening a Company in the UAE for Business
Opening a company in the UAE: it's not just registering a legal entity, but a strategic decision affecting tax efficiency, access to capital, and scaling opportunities. COREDO's experience confirms: the right corporate structure in the UAE not only minimizes tax burden but also builds a flexible model for international trade and investment.
Thus, the creation and competent structuring of a business in the UAE requires consideration of new tax realities and related benefits: more on the current corporate taxes and applicable benefits in 2025 will be discussed later.
Corporate Taxes and Benefits in the UAE 2025
UAE corporate tax applies to tax periods starting on or after 1 June 2023. Taxable income up to AED 375,000 is taxed at 0% and only the part above that amount at 9%, which keeps the burden low for startups and small businesses. Members of multinational groups with global revenues of EUR 750 million or more may also be subject to the domestic minimum top-up tax for financial years starting from 1 January 2025. For international holdings and trading structures, the ability to tax plan through the UAE's network of double taxation avoidance agreements is crucial.
VAT stands at 5%. On the other hand, many free zones provide benefits or exemptions for export-oriented companies. For corporate tax, the free zone 0% rate applies only to a Qualifying Free Zone Person and only to its qualifying income. It must maintain adequate substance in the free zone, keep audited financial statements and meet the other conditions; its other taxable income is taxed at 9%, without the AED 375,000 band at 0%. Economic substance notifications and reports are no longer required for financial years ending after 31 December 2022.
COREDO's practice shows that ignoring these requirements leads to the risk of losing benefits and fines.
Free Economic Zones and Mainland: Comparison
Choosing between free zone and mainland: a key stage of strategic planning. Free economic zones offer 100% foreign ownership, quick startup, and minimal office requirements. This is optimal for e-commerce, IT companies, international trade, and startups targeting export. Mainland is suitable for those planning to work with the UAE market, participate in government tenders, and build offline infrastructure.
| Criterion | Free Zone | Mainland |
|---|---|---|
| Foreign Ownership | Up to 100% | Up to 100% (since 2021) |
| Corporate Tax | Qualifying Free Zone Person: 0% on qualifying income, 9% on other taxable income; other free zone companies: as on the mainland | 9% (above 375,000 AED) |
| Operations within UAE | Restricted | No restrictions |
| Licenses | Specialized | Universal |
| Office Requirements | Flexible | Stricter |
A solution developed at COREDO often includes a hybrid structure: a holding company in a free zone and an operational branch in the mainland. This approach allows optimizing taxes and expanding business without restrictions.
Innovative Ecosystems and Venture Capital
UAE: one of the few markets where the state actively supports startups and tech companies through business incubators and accelerators like Hub71, In5, DIFC FinTech Hive. Participation in accelerators can open access to international partners and grants.
The COREDO team has implemented projects for the registration of IT companies and fintech startups, which, thanks to proper licensing and support, received investments from ADGM and DIFC funds. For e-commerce and SaaS platforms, free zones offer special licenses and tax incentives, accelerating business scaling through the UAE into Asian and European markets.
Business Registration in the UAE: Challenges
Despite the apparent advantages, opening a business in the UAE comes with a number of challenges that are often underestimated by foreign founders. Our experience at COREDO showed: success depends not only on the choice of jurisdiction but also on strict compliance with compliance procedures, structure transparency, and skilled risk management.
Restrictions on Foreign Ownership: What Business Forms to Choose
Although 100% foreign ownership has been allowed in most sectors since 2021, certain industries (e.g., strategic or related to national security) still require local partner participation. It is important to consider corporate governance requirements, the appointment of a secretary, the disclosure of beneficial owners, and the share capital requirements of the chosen licensing authority.
COREDO's practice confirms: errors at the structuring stage (e.g., choosing the wrong free zone or ignoring office requirements) can result in license blockage or the inability to open a bank account.
AML, KYC, and Compliance: How to Avoid Fines
The UAE has integrated international standards in AML/KYC and is actively implementing automatic tax information exchange (CRS, FATCA). Compliance procedures include mandatory due diligence of founders, verification of sources of funds, disclosure of beneficiaries, and economic substance. Country-by-Country Reporting (CbCR) applies only to multinational groups with consolidated revenue of AED 3.15 billion or more in the preceding financial year, and the report is filed by the group's UAE-resident ultimate parent entity.
A solution developed at COREDO includes a preliminary audit of the client's structure, preparation of KYC files, and support at all stages of verification. This minimizes the risk of license refusal or account blockage due to non-compliance with AML requirements.
Opening an Account for a Company in the UAE
Bank compliance in the UAE has become one of the strictest in the region: banks require a transparent structure, confirmation of economic substance, disclosure of ultimate beneficiaries, and a business plan. An opaque ownership structure can lead a bank to refuse the application.
COREDO's team accompanies clients at all stages: from preparing the document package to selecting a bank considering the specifics of the business (IT, e-commerce, trade, fintech). It is important to work out currency control, asset protection, and reputational risks in advance.
Business Registration in the UAE for Non-residents
The registration of a company in the UAE for a foreign founder is a step-by-step process requiring strategic planning and precise adherence to procedures. Below is a step-by-step algorithm that COREDO uses when working with international clients.
Choosing Jurisdiction and Corporate Structure
The first step is determining the target market (local or international), analyzing the benefits of mainland and free zone, as well as the possibility of creating an offshore UAE company for holding or investment purposes. It is essential to consider corporate governance requirements, office presence, number of directors, and corporate secretarial support.
How to Obtain a License and Register Statutory Documents
Next, select the corporate license (IT, e-commerce, trade, fintech, etc.), prepare statutory documents, determine the share capital required by the licensing authority, and collect documents for regulator submission. For some licenses, prior approval from relevant authorities is required.
Opening an Account and Passing AML/KYC
After obtaining a license, go through compliance procedures: prepare KYC profiles of founders, disclose sources of funds, and conduct due diligence. Only then does the bank consider the application for account opening. It's important to prepare a business plan, office lease, and confirmation of economic substance in advance.
Registration of an IT Company in the UAE
Registering an IT company in the UAE requires choosing a free zone with a suitable infrastructure (e.g., Dubai Internet City, In5, Hub71). For e-commerce, there are special licenses allowing international payments and protecting intellectual property. COREDO's practice shows: a well-chosen zone and license accelerate market entry and reduce compliance costs.
Corporate Reporting and Audit: Requirements
With corporate tax, reporting rules depend on a company's size and status. For corporate tax purposes, financial statements follow IFRS; companies with revenue up to AED 50 million may use IFRS for SMEs, and those with revenue up to AED 3 million may use the cash basis. Audited financial statements are required for corporate tax where revenue exceeds AED 50 million and for every Qualifying Free Zone Person. Company law or the free zone authority may impose separate audit obligations, which need to be checked for each company. Economic substance reports are no longer required for financial years ending after 31 December 2022, and CbCR applies only to multinational groups with consolidated revenue of AED 3.15 billion or more.
COREDO supports clients at all stages: from auditor selection to implementation of internal control systems and ESG compliance. Failure to meet requirements threatens fines and loss of tax benefits.
Legal Support for Business in the UAE
Legal support in the UAE is not only company registration but also continuous monitoring of legislative changes, corporate risk management, and intellectual property protection.
Internal Control in Corporate Governance
Effective corporate governance in the UAE is built on the transparency of structure, regular updates of corporate documents, implementation of compliance procedures, and internal control.
Protection of Intellectual Property and Assets
Intellectual property protection in the UAE requires timely registration of trademarks, patents, and copyrights, as well as the implementation of data protection and cybersecurity mechanisms. For cross-border transactions and international payments, COREDO develops strategies to minimize currency and reputational risks.
Business through UAE: Entry into New Markets
The UAE is not only an optimal jurisdiction for business registration but also a strategic hub for scaling into the markets of Asia, Europe, and Africa. International trade through the UAE is facilitated by free trade agreements, developed banking infrastructure, and support for strategic alliances.
COREDO's experience shows: opening a branch in the UAE, business migration, and employee relocation allow rapid adaptation to new markets and reduce regulatory barriers. Strategic planning for entering new markets is built on an analysis of tax, legal, and operational risks.
Practical Tips for Entrepreneurs
Checklist for Business Registration in the UAE:
- Determine the target market and suitable jurisdiction (Free Zone/Mainland)
- Conduct preliminary due diligence and prepare statutory documents
- Obtain the necessary license (IT, e-commerce, trade, etc.)
- Complete AML/KYC procedures and open a corporate bank account
- Set up internal control and corporate governance systems
- Ensure compliance with economic substance and reporting requirements
- Protect intellectual property and assets
- Develop a strategy for scaling into international markets
Mistakes to Avoid:
- Ignoring economic substance and corporate reporting requirements
- Choosing an unsuitable free zone or license without considering business specifics
- Underestimating the complexity of banking compliance and AML/KYC procedures
- Lack of asset and intellectual property protection strategy
Practical Advice:
- For IT and e-commerce, choose free zones with developed infrastructure and startup support
- For trading in the domestic market: consider mainland with a universal license
- Implement internal compliance and ESG procedures from day one of operation
- Engage professional partners to handle complex procedures
Questions about Opening a Company in the UAE
How to open a company in the UAE for a foreign founder?
Step-by-step: choose jurisdiction (mainland or free zone), prepare statutory documents, obtain a license, complete AML/KYC procedures, open a bank account, set up corporate governance.
Step-by-step: choose jurisdiction (mainland or free zone), prepare statutory documents, obtain a license, complete AML/KYC procedures, open a bank account, set up corporate governance.
What taxes does a company pay in the UAE in 2025?
Corporate tax: 0% on taxable income up to AED 375,000 and 9% on the part above; a Qualifying Free Zone Person pays 0% on qualifying income and 9% on its other taxable income. VAT (VAT) - 5%. It is important to comply with corporate tax registration, filing and record-keeping requirements.
Corporate tax: 0% on taxable income up to AED 375,000 and 9% on the part above; a Qualifying Free Zone Person pays 0% on qualifying income and 9% on its other taxable income. VAT (VAT) - 5%. It is important to comply with corporate tax registration, filing and record-keeping requirements.
How to ensure AML compliance when opening a business in the UAE?
It is necessary to prepare KYC profiles of founders, disclose sources of funds, complete due diligence, and comply with international AML/KYC standards.
It is necessary to prepare KYC profiles of founders, disclose sources of funds, complete due diligence, and comply with international AML/KYC standards.
What are the reporting and audit requirements for companies in different zones of the UAE?
For corporate tax: IFRS-based financial statements (IFRS for SMEs up to AED 50 million revenue) and audited statements above AED 50 million revenue and for every Qualifying Free Zone Person. CbCR applies only to groups with revenue of AED 3.15 billion or more, and economic substance reports are no longer required for financial years ending after 31 December 2022. Company law or free zone rules may add separate audit duties.
For corporate tax: IFRS-based financial statements (IFRS for SMEs up to AED 50 million revenue) and audited statements above AED 50 million revenue and for every Qualifying Free Zone Person. CbCR applies only to groups with revenue of AED 3.15 billion or more, and economic substance reports are no longer required for financial years ending after 31 December 2022. Company law or free zone rules may add separate audit duties.
How to choose the optimal corporate structure for business in the UAE?
Depending on business goals: for international trade and IT: free zone; for working in the UAE market: mainland; for investments, UAE offshore company with a transparent structure and corporate governance.
Depending on business goals: for international trade and IT: free zone; for working in the UAE market: mainland; for investments, UAE offshore company with a transparent structure and corporate governance.
My experience and COREDO's practice show: success in the UAE is the result of precise planning, professional support, and constant monitoring of legislative changes. If you are looking for not just registration, but strategic partnership and long-term protection of interests, COREDO's team is ready to offer solutions tested by time and international practice.