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June 4, 2020

How to start an IT company in Dubai, UAE

IT has been a fast-growing industry around the world for some time now, and the UAE is no exception.

Today, the country’s tech sector is estimated at USD 8bn. Within that are countless sub-sectors and organisations of all sizes, from startups and SMEs to multi-national enterprises.

Thriving market aside, there are many great reasons to start an IT company in Dubai, UAE, right now – not least the emirate’s fast and affordable company incorporation process, along with its free zones which attract entrepreneurs from the world over.

Why start an IT company in Dubai, UAE?

If you’re looking to open an IT company, there are numerous reasons to choose Dubai.

The emirate is in the heart of the Middle East, between the markets of Europe, Asia, and Africa. With direct links by land, sea, and air to many of the world’s most prestigious business hubs, it is the ideal location to trade with every corner of the globe.

Then there is Dubai’s famous tax regime, still standing at zero percent on both personal and corporate income. The only other taxes of note are VAT and customs tax. The former is low at a flat 5% while the latter can be avoided by setting up in one of Dubai’s free zones.

These designated trade zones afford inhabitants benefits such as customs tax exemption, zero currency restrictions and capital and profit repatriation. Some free zones are also technology-specific, giving you a ready-made network of IT and tech experts and resources while you launch and grow your enterprise.

Dubai is also home to an incredibly supportive business environment. There is all kinds of support for startups and SMEs on offer, from incubators to coworking facilities and business workshops.

How to open an IT company in Dubai

The first thing to do when starting an IT company in Dubai is to seek out a reputable free zone or company formation specialist. Working with an expert can help to avoid wasted time, unnecessary costs and unwanted frustration when making your applications.

Before managing your application for you, a company setup expert will help you define the type of business activity you wish to undertake. You cannot simply list IT on your trade license. You must specify the exact area of IT that you plan to operate in. Failure to list any activities that you subsequently carry out could lead to fines or license revocation.

The next key part of company formation in Dubai is deciding on a company name. Here in the UAE, there are several naming conventions that you must abide by. They include:

  • Only full names allowed, no abbreviations
  • Cannot include any potentially offensive or blasphemous words
  • Must be available to register

Now you can apply for your IT license. The application process differs depending on whether you are setting up in the mainland or in a free zone.

If you are applying to incorporate a mainland business in Dubai, you should do so to the Department of Economic Development. In other emirates, you should apply to the equivalent body.

If, however, you are forming a free zone business, you can apply directly to the free zone.

It is often advisable to set up in a free zone. As well as being the most cost-effective approach, you can also make use of flexi desks, coworking spaces and business facilities. This usually includes reception cover and access to meeting and conference rooms, as well as the use of telephones, broadband and the like.

When making your application, you are usually required to provide some basic documentation such as a passport copy and business plan.

Best free zone to start an IT company 

Dubai Technology Entrepreneur Campus (Dtec) makes the ideal home for IT companies. Located in Dubai Silicon Oasis, a technology-focused free zone, Dtec offers a supportive environment for IT businesses as well as a range of workspace packages at a scale and price to suit all budgets, including:

Flexi desks: Company setup with workspace in any of our common areas.

Fixed desks: Company setup with your own fixed workstation in a shared area with lockable storage.

Private offices: Company setup with your own furnished or unfurnished office between 12-50sqm.

The 10,000 sqm facility is home to an integrated ecosystem for hundreds of startups, SMEs and technology entrepreneurs from around the world.

Cost of setting up an IT company in Dubai
It is not easy to indicate the cost of starting an IT company in Dubai. There are many factors at play.

Setting up in a free zone is often an excellent way to keep startup costs low. Free zones such as Dtec offer package prices, inclusive of visa applications and the use of office facilities.

The flexi desk package, for example, includes a service license, the use of a workspace in a common area and eligibility for two visas. This package starts at AED 18,000 per year.

Dtec also offers a license with fixed desks and eligibility for three visas for AED 24,200 per year, plus furnished private offices, inclusive of two visas per desk, for AED 47,820 per year.

Starting a business in Dubai, UAE

If you’re looking to start an IT business in the UAE, there’s no better base than Dtec. Apply with us, and we’ll handle every step of the process for you – helping to outline activities, register your company name, applying for your license and visas, and supporting you once you’re up and running.

For technology startups and entrepreneurs looking for flexible coworking or office space in Dubai, Dtec offers a nurturing, supportive community from which to set up your new business.

Got a great idea you want to see realised? Everything you need can be found in Dtec. Our coworking space encourages collaboration, our accelerator programs and funding arm give a young business set up in the UAE a head start, and our networking events ensure you get your name out there and stay on top of industry trends. We take care of everything, leaving you to take care of your business.