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Benefits of Limited Liability Company (LLC) Formation in the UAE

llc company formation

Many entrepreneurs are now launching their business in the UAE. In March 2020 alone, a total of over 18,000 business registration and licensing transactions were recorded. The Dubai Department of Economic Development recorded 2,523 new license issuance, which created over 6,000 jobs. 58% of the licenses were professional licenses, and 39.3% were commercial licenses.

One of the trusted and most common types of license setup in Dubai is the Limited Liability Company or LLC. It is basically a license with multiple shareholders. There are several reasons why LLC is among the most popular in Dubai Mainland setup options. One of the main reasons is that it allows the legal entity to conduct business, trade directly with the local market, and even with the UAE Government, aside from the fact that its business registration process is affordable and fast.

 

What are the Benefits of Setting up a LLC in Dubai

  1. Low Setup Costs – LLC is one of the most attractive setup options for first-time entrepreneurs, with license costs starting from AED 8,000. Talk to one of our Business Setup Advisors to find out the process on how to set up a LLC in Dubai.
  2. Protection – LLC provides personal protection to entrepreneurs where an entrepreneur, owner, or shareholder will not be liable should anything go wrong and gets your business in trouble. Your liability is capped at the amount invested in the business. 
  3. Wide range of permitted business activities – Compared to Free Zones and even other types of companies, LLCs can obtain a wide range of business activities. Dubai DED currently has over 2,000 activities permitted from accounting to agriculture.
  4. Freedom to trade anywhere in the UAE – Unlike Free Zone licenses, LLCs are allowed to conduct business directly in the local market and set up an office space anywhere in the UAE mainland.
  5. Easy to branch out – Not only can you trade directly with the UAE local market, but you will also be permitted to open a branch office throughout the UAE and establish a greater presence in the country. Having a LLC license is also the most effective way to branch out.
  6. Multiple shareholders – You can have up to 50 shareholders when forming a LLC in Dubai. These shareholders can be individuals, corporate entities, or both.
  7. Tax-Free – The UAE is known for its incredible tax-free environment. LLCs are 100% tax-free – zero tax on all profits.

 

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How about a Local Sponsor? 

When forming a LLC in Dubai, you will be required by the Dubai DED to obtain a Local Sponsor. A local sponsor will be holding a 51% stake of your business; however, they have no control over your business’ day-to-day operations, and you can keep your profits 100%.

Smart Zone is currently offering a Zero Local Sponsorship Fee for anybody who registers a company under the Dubai DED this October. Talk to one of our Business Setup Advisors today to get more information on how you can take advantage of this offer and lower your setup costs. 

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