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Myths vs. Facts about Business Setup in Dubai

By Ananya - 09 Apr 2022 Last Updated: 09 Apr 2022
Myths vs. Facts about Business Setup in Dubai

Table of Contents 

  1. 1. Myths and Facts for Setting up a Business in Dubai
  2. 2. Conclusion

Dubai is an intriguing and unparalleled city where businesses are constantly thriving. The city is home to some of the world's largest corporate houses, with billions of dollars in investment.

Unfortunately, many people have misconceptions regarding the procedures and opportunities involved in establishing a business in Dubai. This makes it difficult for business investors and owners to determine the best decision for their company. It's important to believe what you hear and read, but it's even more critical to double-check the facts before you commit, especially if you're a first-time entrepreneur.

If you've been struggling with the same issue, Dhanguard is providing this guide for you!

Myths and Facts for Setting up a Business in Dubai

Myth: Business Incorporation is Costly

Business Incorporation is expensive is actually a false myth.

Let's look at the Reality of the Business Incorporation

Dubai Corporation is Economical.

Incorporation of a business in any part of the world necessitates a significant commitment of capital, which is supported by a number of characteristics.

Dubai, the most populous destination in Dubai, is considered an investment hub since the cost of incorporating a company in Dubai is lower than in other European places.

The Emirati government has established various zones, such as Mainland, Free Zone, and Offshore destinations, which are viable based on the commercial activity.

Most new businesses opt to establish a company in Dubai Freezone since it allows them to take advantage of tax breaks. Established companies, on the other hand, focus on Mainland incorporation because business activities can be carried out in various areas of the country and outside the country.

Dealing with the Legalities is Time Consuming

Any foreign investor would be an outsider in the UAE's legal proceedings for business incorporation. This, however, should not be an impediment to investors forming their ideal firm today.

Most business investors or owners place a high value on time. As a result, they prefer to work with competent professionals who can help them in the best possible and feasible way to kick-start their firm by clearing the legal proceedings.

Hence, Dealing with the legalities is not a Time Consuming

Offshore Businesses are Illegal


Offshore Businesses are Growing

Offshore banking was traditionally regarded as a criminal enterprise, with participants engaging in actions such as money laundering and tax evasion.

Offshoring business activities are now regarded as a wise decision because business investors can benefit from substantial tax breaks and business operations can be carried out remotely.

Most company investors pick JAFZA as their offshore destination in Dubai. Here's a guide on How to Open an Offshore Business in the UAE if you want totals. Having a Local Sponsor is required.

Obtaining a Local Sponsor Is Dependent on Business Activities

Local sponsorship is a concept in which local workers (individual or corporate) control 51 percent of the company's shares, while the owner owns only 49 percent.

According to the UAE Government's current initiatives, the rule is only applied to 122 permitted commercial activities.

This means that Non-GCC entrepreneurs can easily establish a shop without the need to partner with a native Emirati. Take a look at our most recent guide on Finding Local Sponsors in Dubai to get a sense of what we're talking about.

Dubai is not a decent Location for Female Entrepreneurs.


Dubai Is a Great Spot for Female Entrepreneurs

Dubai is quickly becoming the Middle East's most prolific destination for women seeking to launch and fund their enterprises.

The number of women-owned enterprises in Dubai grows year after year, making it an ideal location for promoting a good work-life balance. These support networks enable women to excel in business and thrive in positions of leadership.

Dubai is one of the most liberal cities in the Middle East and is at the forefront of progressive growth. The United Arab Emirates aims to maximise its resources in order to achieve long-term prosperity and to prepare its future generations to face future problems.

The UAE's accomplishments illustrate its commitment to gender equality and inclusiveness, which is why it is regarded as one of the greatest countries to do business with right now!

So, if you are ready to take the next step, Dhanguard can be your partner in guiding you to success by simplifying all legal formalities.

You should know Arabic to fit into the UAE Business Society

You will be working with people from hundreds of different nations and religious beliefs in the UAE, and everyone wants to establish a common language, therefore English has become that language.

In Dubai, for example, if you have at least a basic command of English, you will always be able to get by: all street and indoor signs and official documents have been translated into English, and newspapers, websites, radio, and television mostly communicate in English. In 99 % of circumstances, when you call a company, you will be answered in English.

Setting up a Business in Dubai is Difficult

This myth holds that it is considerably more difficult and time-consuming for foreigners to establish a business in Dubai than it is for natives. Let's take another look at the numbers.

According to government data, 95 % of all businesses in the UAE are SMEs. The second truth is that immigrants make up 89 % of the population (non-UAE citizens). So, when statistics are compared, it is clear that the majority of enterprises in the country are created by foreigners working in the SME sector.


We provide a full company setup package, taking care of all legal compliances, tax registration, and documentation required starting a business in Dubai. If you have any questions, please contact one of our specialists. Please contact us right away; we'd be happy to help!

Dhanguard provides the business setup and company formation services in Dubai, UAE with the guidance of our professional team of consultants. Faster and hassle-free company setup in Mainland and Freezone in UAE.

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