Have you been thinking about starting a business in Dubai but don’t want to set up an actual office yet? A virtual company license allows you to legally register your business in Dubai without having a physical presence. This article will explain everything you need to know.
What is a Virtual Company?
A virtual company in Dubai is a legally registered business with a trade license that is allowed to operate without having a physical office or staff based in the emirate. It allows the license holder to conduct business activities through the internet while still enjoying the tax and other benefits of being licensed in Dubai.
Why Get a Virtual License in Dubai?
There are many excellent benefits of obtaining a Dubai virtual license:
- Low setup and renewal costs compared to a full commercial license
- Access to the Dubai tax system and ability to legally invoice clients
- Ability to open a proper Dubai business bank account
- Easy to upgrade to a full legal entity with office and staff later on
Who Can Apply for a Virtual License?
Both individuals and corporate entities can apply for a Dubai virtual license. The key requirements are:
- You must appoint a UAE national or company to act as your local service agent to sponsor the license
- The shareholders and managers of the company do not have to be UAE residents
- 100% foreign ownership is allowed for most activities
Step 1: Choose Your Business Activity
There are over 2,000+ business activities that are covered by the Dubai virtual licensing system. You need to select one activity that closest matches your planned virtual business.
Some popular options for virtual companies include:
- Business consultancy
- Digital marketing
- E-commerce websites
- IT and tech support services
- Import/export trading
Be sure to consult to consult the approved activity list and discuss options with your agent
Step 2: Find a Local Service Agent
Every business in Dubai needs a local sponsor or service agent to help secure licenses and assist with set up. They charge annual fees for acting as the license sponsor.
If you have contacts in Dubai, ask them if they have recommendations for agents that support virtual companies. You can also search online directories.
Step 3: Select Your Virtual Company Location
Even if you won’t have an actual office, you still must specify a virtual location for your Dubai license.
Most virtual companies select one of the 30+ different free zones across Dubai and Sharjah. These zones offer easier rules, faster approval, and allow 100% foreign ownership.
Some popular free zones include Dubai Silicon Oasis, Sharjah Airport International Free Zone, and Dubai Multi Commodities Centre (DMCC).
Step 4: Choose a Unique Business Name
You’ll need to pick a business name not already being used by another company in Dubai before applying. Many free zones let you search their name database online.
It’s wise to have a few different name options in mind, in case your first choice is already taken by another business.
Step 5: Complete the Virtual License Application
Your local service agent will help prepare all the required documents and application forms needed to submit for the virtual trade license approval.
Typical documents needed include:
- Passport copies of company owners/partners and managers
- No Objection Letters (if applicable)
- Proof of capital from the owners
- Signed Memorandum & Articles of Association
The exact requirements may vary slightly depending on the free zone.
Step 6: Open a Business Bank Account
Once your Dubai virtual license is approved, you need to open a proper corporate bank account to handle any payments, deposits, or transactions for your Dubai business.
Submit your new bank account details to the Department of Economic Development (DED) to have it officially linked with your trade license.
Step 7: Renew Your License Each Year
A Dubai virtual license is issued for a period of one year initially. You’ll need to renew your virtual trade license each year with the assistance of your local agent.
Typical renewal fees are AED 4,000-6,000 per year depending on your activity. Your agent will handle the license renewal process.
And that covers the main steps! With some planning and the right local support, obtaining a virtual business license in Dubai is relatively straightforward.
Ready to Apply? Contact Us for Assistance
Our business setup consultants can guide you through the Dubai virtual licensing process from start to finish. Reach out for a free consultation.
Advantages of the Virtual Company License in Dubai
- Online Business Operations: The license allows for the digital management of all business-related tasks, including document signing and submission. Signatures obtained through this method are recognized as valid in the UAE.
- Low Startup Costs: Entrepreneurs benefit from reduced initial costs and administrative burdens, making it an attractive proposition for those looking to expand their business.
- Access to Dubai’s Opportunities: Dubai, a city known for its business opportunities, has become more accessible to virtual businesses. It opens doors to new clients, markets, and investment possibilities.
- Inclusion in the Directory of Virtual Businesses: Virtual companies have the opportunity to be a part of the virtual city, connecting with a diverse range of businesses.
Conclusion:
Obtaining a virtual company license in Dubai offers a fantastic opportunity for entrepreneurs and businesses to establish a legal presence in the UAE without the need for a physical office or staff. By following the step-by-step process outlined in this guide, you can navigate the virtual licensing process efficiently and enjoy the numerous benefits it provides.
From low setup and renewal costs to accessing Dubai’s tax system and the ability to legally invoice clients, a virtual license is an excellent starting point for those seeking to tap into the UAE’s thriving business environment. Additionally, the flexibility to upgrade to a full legal entity with an office and staff later on makes a virtual license an attractive option for businesses with long-term growth plans.
Remember, seeking guidance from experienced business consultants and local service agents can significantly streamline the process, ensuring compliance with all relevant regulations and maximizing the advantages of your virtual company license in Dubai.
FAQ’S
Unfortunately no. A Dubai virtual license does not allow sponsoring any employees or visas. You would need to upgrade and convert to a full legal entity to hire staff locally.
No, one of the benefits of a virtual license is not requiring any physical office or commercial space in Dubai. All business activities can be managed entirely online.
Expect to pay between AED 16,000-20,000 for the first year, covering license setup, agent fees, and renewal for the first 12 months. Renewal costs after the first year are usually AED 4,000-6,000 annually.
