Dubai is fast emerging as a leading global tech and IT hub. Many international IT companies are basing their Middle East operations out of Dubai. If you want to expand your IT business to Dubai, this guide will walk you through the key steps.
Why Should You Set Up an IT Company in Dubai?
Dubai offers the ideal ecosystem for IT businesses due to its world-class infrastructure, strategic location and business-friendly policies:
- Technology Infrastructure: State-of-the-art connectivity, high-speed internet, 5G networks, cloud services etc.
- Global Access: Easy access to markets in Middle East, Africa and South Asia due to its connectivity by sea and air.
- Government Support: Policies and incentives to attract IT companies and support digital transformation.
- Skilled Workforce: Large pool of knowledgeable IT professionals available for hiring.
- Security: Very low crime rates and political stability ensure operational security.
- Lifestyle: Dubai offers high standard of living, amenities, culture and entertainment.
Choosing the Right License Type
The first step is deciding between a mainland or free zone license in Dubai based on your business activities:
Mainland License
- Need local partner with 51% shares
- Can work in Dubai and rest of UAE
- Higher costs and restrictions
Free Zone License
- 100% ownership allowed
- Limited to free zone area only
- Lower costs, faster setup
IT Consulting/Services: Free zone like DMCC, DWTC is recommended
Product Development/Manufacturing: DAFZA, Meydan free zone work better
Detailed Requirements and Procedures
Once you choose the license type, here are the key requirements:
- Share Capital: Minimum AED 50,000 or AED 300,000 based on license.
- Office Space: Must lease commercial space in free zone or mainland.
- Local Partner: For mainland, 51% shares owned by local sponsor.
- Visas: Employer’s liability insurance to sponsor work visas.
- Documentation: Business plan, MOA, lease agreement, passport copies etc.
It takes 4-6 weeks to set up the company through the following process:
- Choose free zone or mainland
- Find office space and get lease papers
- Apply for initial approval
- Reserve company name
- Submit documents and capital
- Obtain license
- Apply for visas
- Open bank account
Best Free Zones for IT Companies
Here are top free zone options for IT companies in Dubai:
DMCC
- Low cost license and office space
- IT, consulting, e-commerce focused
- Fast setup in 2 weeks
DWTC
- Part of massive Dubai World Trade Centre complex
- IT consulting and services focused
- Excellent connectivity
DAFZA
- Ideal for product development/manufacturing
- High-tech infrastructure and facilities
Meydan Free Zone
- New free zone, attractive incentives
- IT and tech companies can set up here
- Match free zone benefits to your specific IT niche and activity.
Operating Costs and Considerations
Here are the key ongoing costs and factors for running your Dubai IT company:
- License Renewal: Pay fee annually, ranges from AED 25,000 – 60,000.
- Office Rent: Lease needs to be renewed yearly. Rent depends on location.
- Salaries: Average IT salaries range from AED 8000 – 25,000 per month.
- Visa Costs: AED 6,000 per employee on average for residency visa.
- Taxes: No personal income or corporate tax (yet). Only 5% VAT.
- Hiring: Strong pool of IT talent from India, Eastern Europe, Philippines etc.
Leveraging Dubai as a Strategic IT/Tech Hub
Dubai provides the following strategic advantages for IT companies:
- Technology Infrastructure: World-class connectivity, data centers and cloud infrastructure.
- Co-Working Spaces: Affordable co-working options for startups and SMEs.
- Innovation Clusters: Spaces like Silicon Park Dubai offer synergies.
- Market Access: Easy connectivity to markets like Saudi Arabia, Africa etc.
- Skilled Workforce: Dubai attracts top tech talent from around the world.
- Support for Innovation: Initiatives like Dubai Future Accelerators encourage innovation.
Conclusion
Dubai offers the ideal ecosystem, connectivity, and lifestyle to expand your IT business. Following the step-by-step guide outlined above will help you successfully set up your IT company in Dubai and leverage it as a strategic hub serving regional and global markets. The future is digital – are you ready to be a part of it in Dubai?
FAQs
You can get an Investor visa if establishing a mainland company, or an Entrepreneur visa for free zone companies. Employees can be sponsored for residency visas.
The minimum share capital ranges from AED 50,000 to AED 300,000 depending on mainland or free zone license.
No corporate income or personal taxes. Only 5% VAT on goods/services. No import/export duties in free zones.
Main costs are license renewal fees, office rent, salaries, visas for employees. Also costs like utilities, insurance etc.
You need to get employer liability insurance first. Then you can apply for work visas and sponsor employees.
