The United Arab Emirates (UAE) is a leading global business hub, with advanced infrastructure and a strategic location linking Asia, Africa, and Europe. In 2024, the UAE attracted record foreign direct investment (FDI) of AED 167.6B (USD 45.6B), accounting for 37% of total FDI inflows into West Asia and the MENA region – ranking 1st in both. Its open economy, along with reforms such as 100% foreign ownership in most sectors, continues to attract global entrepreneurs.
While the UAE stands out with its free zones, strategic location, and near‑zero tax incentives, Ireland continues to draw companies with its innovation culture and EU market access, and the Netherlands remains a leader in combining strong R&D incentives with a highly stable regulatory environment.
Related: Doing Business in the Netherlands in 2025
Quick Facts for Doing Business in the UAE in 2025:
- Gateway location: Connects Gulf markets to 2+ billion consumers across Asia, Africa & Europe
- Corporate tax: 0% on profits up to AED 375,000; 9% on earnings above AED 375,000
- Ownership: 100% foreign ownership now allowed in most industries (no local partner needed)
- Workforce: Over 200 nationalities in UAE; long-term visas (e.g. 5 to 10-year Golden Visas) and remote-work permits attract global talent
- FDI leader: UAE accounts for ~37% of Middle East & North Africa FDI (Dh167.5 b in 2024), reflecting its competitiveness (ranked top in MENA by global indices) and business appeal.
Why UAE Matters for Global Expansion in 2025
The UAE offers a unique combination of strategic, fiscal, and operational advantages that few jurisdictions can rival:
- Strategic Global Gateway: Situated at the crossroads of Asia, Europe, and Africa, the UAE connects businesses to over 2+ billion consumers and major trade routes.
- Highly Attractive Tax & Ownership Regimes: In many of its Free Zones, the UAE offers zero corporate or personal income tax, full repatriation of profits and capital, and 100% foreign ownership.
- Regulatory & Business Ease: Business setup in many UAE Free Zones is streamlined, with minimal bureaucracy. Licenses, visas, and operational approvals are often faster and more efficient than many other jurisdictions to make entry smoother.
- Diverse & Growing High‑Potential Sectors: The UAE is investing heavily in technology & innovation (AI, fintech, digital transformation), renewable energy (solar, hydrogen), and financial services. These sectors are being supported by national strategies, large infrastructure investment, and industry focused Free Zones.
- Stability & Global Trade Networks: Strong legal and financial systems, peace and safety, plus a robust network of double taxation treaties (DTAs) and trade agreements help mitigate risk for global businesses. The UAE also offers policy consistency and investor protections that give confidence to long‑term investors.
Related: Top 15 Countries by GDP in 2025
Business Structures in the UAE in 2025
UAE company setups include Mainland (Onshore), Free Zone, and Offshore entities. All three allow 100% foreign ownership: by law foreign investors may fully own onshore (mainland) companies in most sectors. Broadly:
- Mainland (Onshore): Companies can operate anywhere in the UAE (including government contracts), requiring a local office/license. Mainland businesses now permit full foreign ownership in most fields. This grants unrestricted trade but comes with higher set-up costs (office rent, local approvals).
- Free Zone: Free zones (40+ across Emirates) grant 100% foreign ownership and tax incentives (often 0% corporate tax for qualifying activities). Setup is simpler, and flexi-desk or virtual offices are available. However, free-zone companies generally can only trade within the zone or internationally – they cannot sell directly into the UAE domestic market without a mainland license.
- Offshore: UAE offshore companies (e.g. JAFZA Offshore, RAK ICC) are wholly foreign-owned structures. They enjoy zero UAE taxes and high confidentiality but cannot conduct business onshore or sponsor UAE visas. Offshore setups are ideal for international trading, asset holding or investment vehicles, not for local UAE operations.
Cerity Global advises clients on the right structure and manages the full legal entity setup process, from licensing to compliance filings.
Related: UAE Country Page
Step-by-Step: Setting Up a Business in the UAE
The process of doing business in the UAE in 2025 typically spans 6 to 12 weeks end-to-end. And the key phases include:
- Planning & Documentation: Choose entity type (mainland, free zone, offshore) and emirate, select business activities, reserve a trade name, and prepare shareholder documents (passports, business plans, etc.).
- Legal Setup & Licensing: Submit license application to the relevant authority (DED for mainland, or the specific free-zone authority). Obtain initial approvals and final trade license. Secure required office space or flexi-desk per jurisdiction.
- Operational Setup: Open a corporate bank account (be aware banks now require thorough due diligence). Register with Federal Tax Authority for corporate tax and VAT. Complete labor and immigration formalities (e.g. apply for establishment card, then employee visas).
Alongside licensing, companies must establish a compliant HR and payroll systems to remain operationally sound.
Cerity Global integrates the HR, payroll, and employee benefits during the setup phase to ensure business stay compliant.
Related: Legal Entity Setup in 2025
Cost of Doing Business in the UAE (2025)
The cost of doing business in the UAE, via a legal entity setup varies depending on the business structure, jurisdiction, and activity:
- Mainland company: Generally the cost would cover trade license and registration fees, along with office lease costs. Many emirates also charge a fee equal to 5 to 7% of the annual rent.
- Free Zone company: Depending on the free zone, the cost typically includes license type and visa quota. Many free zones offer “starter” packages with flexi-desk or shared office options at the lower end of the range.
- Ongoing costs:
- Corporate tax: 9% of annual profits above AED 375,000 (profits below this threshold remain exempt).
- VAT: The standard VAT rate is 5% and it applies to most goods and services.
- Employment costs: UAE labor law mandates statutory benefits such as health insurance, paid annual leave, and end-of-service gratuity, which add to overall payroll expenses.
Corporate tax and VAT filings in the UAE require accurate accounting and timely compliance. Cerity Global’s international accounting and tax experts to help businesses stay compliant and avoid costly penalties.
Key Opportunities in the UAE
The UAE is diversifying its economy and high-growth sectors include:
- Technology & Innovation: The UAE emphasizes AI, data infrastructure and digital transformation. Major initiatives (e.g. UAE AI Strategy, smart city projects) drive demand for data centers, AI-driven solutions, fintech and e-commerce. The FinTech sector is booming, UAE FinTech funding reached $265 m in 2024 (about 1/3 of the region’s startup funding), and 89% of residents now use digital-first banking platforms. Blockchain and Web3 are also on the rise under supportive regulations.
- Renewables & Clean Energy: Under its Net Zero 2050 strategy, the UAE is investing heavily in solar power, green hydrogen and other clean-tech. Large solar farms and sustainable industrial zones are in development, attracting both institutional and impact investors.
- Financial Services: The UAE remains a center for regional finance. Islamic banking is mature, and digital finance is growing rapidly. The UAE leads the region in FinTech, and new frameworks (e.g. digital asset regulations) are being implemented. Wealth management and asset services are boosted by an influx of high-net-worth expatriates drawn by favorable tax and residency regimes.
While the UAE is accelerating investment in AI, fintech, and renewable energy, Ireland remains strong in life sciences and technology, and the Netherlands continues to lead on innovation tax credits and logistics positioning.
Related: Doing Business in Ireland in 2025
Challenges to Consider
For companies doing business in the UAE in 2025, managing corporate tax and HR regulations can be complex.
- Corporate Tax Compliance: With the new UAE corporate tax regime effective mid-2023, companies must file their first annual returns by 30 Sep 2025. This requires audited financial statements, transfer-pricing documentation and proper accounting records. Non-compliance can lead to penalties, so expert tax and compliance support is essential.
- Real Estate / Office Requirements: Mainland licenses require a physical office lease and Ejari registration. Even free zone companies need to secure an authorised office, though many zones offer flexi-desk/virtual options. Budgeting for workspace costs and Ejari fees is critical.
- Multicultural Workforce: The UAE workforce is very diverse (200+ nationalities). Companies must navigate cultural differences, labor-sponsorship rules, and periodic visa renewals. Robust HR, payroll, and employee benefits systems are essential to maintaining compliance and supporting a diverse workforce.
Cerity Global provides integrated tax and compliance solutions tailored to UAE labor laws.
Related: EOR vs Legal Entity Setup in 2025: Which Is Best for Global Expansion?
FAQs on Doing Business in the UAE (2025)
What is the corporate tax rate in the UAE?
Corporate tax is:
- 0% for taxable income up to AED 375,000
- 9% for taxable income above AED 375,000
Free zone companies that meet all requirements may retain 0%.
Do I need a local sponsor or partner?
No. Since the mid-2021 reforms, foreign investors can fully own onshore businesses in most sectors. A local service agent is no longer required for most activities (only strategic sectors may have exceptions).
How long does company setup take?
It varies by structure. Free-zone companies can often be formed in a few weeks, while mainland setups typically take 1 to 3 months. A full setup (from planning to bank account) is often 6 to 12 weeks, assuming documents are in order.
Is a physical office required?
Yes. Mainland companies must lease a commercial office. Free-zone companies also need a registered office, though many offer flexi-desk or shared-space solutions. Virtual companies (offshore) have no UAE office requirement but cannot operate locally.
Which Emirate is best for setup?
Dubai is the most popular for its connectivity and free-zone options, but each emirate has strengths. Abu Dhabi offers major infrastructure projects and global links; Sharjah, Ras Al Khaimah, Ajman and others each have sector-focused zones. Choose based on your industry, budget and market access needs.
Why Expand to the UAE in 2025?
Choosing the UAE as your hub for doing business in 2025 means leveraging global connectivity and competitive policies. The UAE combines strategic location, favorable regulation, and global connectivity, making it a top choice for expansion in 2025. Whether you’re a startup, SME, or enterprise, the UAE offers a strong platform for global growth.
The UAE offers an attractive platform: a strategic gateway to growing markets, progressive business policies, and world-class infrastructure. It consistently ranks among the most competitive economies in the region. In 2025, the UAE’s liberal economy, new visa options, and connectivity (ports, airports, digital links) provide strong advantages for startups, SMEs and multinationals alike. Whether entering Middle East/Africa markets or scaling global operations, companies find in the UAE a stable yet dynamic environment for growth.
With Cerity Global’s global expansion services, companies can set up a legal entity, hire directly, and operate confidently in the UAE, while smoothly managing HR, payroll, accounting, tax and compliance across 170+ countries.
How Cerity Global Can Help
Cerity Global specializes in helping companies expand into the UAE and GCC. We provide end-to-end support, from entity setup and licensing to payroll, tax compliance, HR and ongoing administration, across all Emirates and 170+ countries worldwide. Contact Cerity Global for tailored guidance on your UAE expansion.
Ready to Expand into the UAE?
Cerity Global helps companies with legal entity setup, payroll, tax, compliance, and HR support across all seven emirates and 170+ countries worldwide.