Registration of an IT company in the UAE

01.08.2023

Registration of an IT company in the UAE

The rapid advancement of information technology (IT) has cultivated a conducive environment for establishing IT companies in the UAE. The nation is actively fostering the growth of its IT sector through various programs and initiatives. As part of these endeavors, the UAE offers a comprehensive range of programs and services tailored to aid entrepreneurs in launching and expanding their IT enterprises.

Categories of IT organizations in the UAE

The UAE accommodates a broad spectrum of activities for IT companies, granting entrepreneurs the opportunity to engage in diverse IT-related endeavors. Let's delve into some of these categories:

Application development. In the UAE, IT companies specializing in mobile application development for various platforms, including iOS and Android, can be registered. These firms have the capability to craft innovative and functional applications to cater to a wide clientele.
Software development. IT companies focused on software development can also register in the UAE. This encompasses the creation of specialized software tailored to various industries such as healthcare, finance, or transportation.
Digital marketing. In recent years, digital marketing has become an integral aspect of business operations. Interested parties can establish IT companies in the UAE's free zones, offering digital marketing services including search engine optimization, contextual advertising, social media management, and website development.
IT consulting. Companies specializing in IT consulting and advisory services can find a place in the UAE's business landscape. These entities provide expert guidance on the implementation and optimization of IT solutions for other organizations.
E-commerce. The UAE holds significant potential for e-commerce enterprises. Registering a company in this category enables you to conduct online commerce, selling goods and services in the digital realm.

These represent just a few examples of the IT company categories open for registration in the UAE. It's important to note that each category comes with specific features and registration requirements. For detailed information tailored to your business needs, feel free to contact our company's experts.

Government programs supporting IT company formation in the UAE

The UAE boasts government programs dedicated to bolstering the growth of IT companies, catering to both emerging startups and established firms. These programs offer an array of resources and opportunities to facilitate success:

Incubators

These government programs foster the development of IT companies in the UAE by providing startups with dedicated workspaces, equipped with amenities like high-speed Internet, equipment, meeting rooms, and technical support. Additionally, incubators offer access to expert guidance, assisting entrepreneurs in refining their ideas, business plans, and strategies.

Accelerators

Tailored for businesses in the growth stage, accelerators supply investment, training, consulting, and industry connections. They aim to help companies surmount growth challenges and reach new heights. Accelerators typically organize training programs, including masterclasses, seminars, and workshops, offering insights into industry best practices and essential skills.

Mentorship programs

Mentor programs facilitate connections between seasoned entrepreneurs and emerging companies. Mentors with extensive IT experience provide valuable advice, guidance, and support. These mentors help entrepreneurs develop their business acumen, expand their network, and conquer challenges. They can also aid in forging strategic partnerships and gaining access to new opportunities.

Government programs supporting the establishment of IT companies in the UAE play a pivotal role in stimulating innovation, fostering a conducive business environment, and solidifying the UAE's global standing in the IT sector. These initiatives provide entrepreneurs with access to crucial resources, knowledge, and skills, enabling them to successfully launch and expand their IT enterprises. The UAE actively promotes IT sector development and innovation, making it an appealing destination for investors looking to establish their own IT companies.

Features of locations for establishing an IT organization in the UAE

When considering the registration of an IT company in the UAE, you have two primary options to choose from: setting up in a free zone or targeting the local market. For those seeking to establish an IT company in the UAE, popular locations include free zones, specifically Dubai Internet City or IFZA.

Free zones.
1. Free zones in the UAE offer businesses the opportunity to maintain 100% ownership and control of their operations. The absence of a requirement to involve a local partner allows foreign investors to retain complete control over their IT company.
2. Opting to open an IT company in the UAE free zones grants access to tax benefits and exemptions from corporate taxes for a specific period. This enables companies to save a substantial amount on taxes, which can be reinvested in expanding their business.
3. Registering a company in a free zone typically involves a swift and streamlined process. It includes options for pre-configured office spaces, various types of licenses, and dedicated infrastructure tailored to the needs of IT companies.
Local market.
1. As of 2020, the mandatory requirement to engage a local partner and transfer 51% ownership in most business sectors for registering an IT company in the UAE has been abolished. Entrepreneurs are now permitted to retain full ownership of their company, allowing for more flexible management and control.
2. Establishing a local company provides access to the domestic market and local clientele. This enables the company to forge closer relationships with local organizations, authorities, and resources, potentially leading to additional business growth opportunities.
3. Ownership of a local IT company in the UAE facilitates access to local contacts, connections, and resources. These can be invaluable in establishing partnerships and obtaining support within the jurisdiction.
Offshore zones.
1. In the past, IT companies often preferred offshore zones to register their UAE-based businesses. Offshore zones, such as RAKICC (Ras Al Khaimah International Corporate Center), offered advantages like confidentiality, simplified regulations, and favorable taxation. However, the feasibility of opening bank accounts for offshore companies has diminished due to international legislative changes and stricter transparency and anti-money laundering requirements. UAE banks now prefer working with companies registered in free zones or local entities.

It's important to note that opening a bank account in the UAE free zones can be a labor-intensive process and is often challenging to navigate independently. However, our company possesses the necessary expertise in communicating with UAE banks and a profound understanding of market trends and requirements. Our team of specialists has extensive experience in facilitating the opening of bank accounts in the UAE.

The choice between a free zone and the local market hinges on the specific needs and goals of your IT organization. Free zones typically offer greater flexibility, tax advantages, and simplified registration procedures. On the other hand, targeting the local market can provide access to domestic resources and opportunities. It's essential to conduct thorough research and consult business advisors to select the most suitable option for those intending to launch an IT company in the UAE.

The Smart Dubai initiative for IT companies in the UAE

The Smart Dubai initiative represents a visionary endeavor undertaken by the UAE government, aimed at establishing an innovation ecosystem and transforming the city into a digital hub. This initiative presents unique opportunities for IT companies to collaborate with government agencies and offer their solutions and services as integral components of Smart Dubai projects.

One of the primary objectives of the Smart Dubai initiative is to enhance the quality of life for both residents and visitors by introducing cutting-edge technologies and digital innovations. To achieve this goal, Smart Dubai actively seeks engagement with IT companies, inviting them to participate in projects and contribute their products, services, and solutions to enhance various facets of urban life.

Benefits of IT companies participating in the Smart Dubai initiative

Access to government contracts. IT companies gain access to substantial government contracts, presenting lucrative business opportunities.
Real-world testing. The initiative provides a platform for IT companies to test and implement their innovations in a real-world urban environment, validating their solutions' effectiveness.
Access to experts and resources. Companies engaging in the initiative benefit from access to a network of experts and resources that support business development and growth.

Entrepreneurs looking to establish an IT business in the UAE can actively participate in the Smart Dubai initiative. This engagement enables them to offer a wide array of solutions and services encompassing smart city systems, digital infrastructure, mobility management, e-government solutions, blockchain, artificial intelligence, and numerous other IT domains.

Global exposure and knowledge sharing

Participation in Smart Dubai projects transcends national boundaries and allows IT companies to showcase their technological solutions and innovations to a global audience. Additionally, Smart Dubai serves as a knowledge and experience-sharing platform among IT companies, fostering collaboration and the formation of new partnerships.

In essence, the Smart Dubai initiative unfolds exciting opportunities for IT companies operating in the UAE. It invites them to be pivotal contributors to critical projects and the implementation of innovative solutions within the digital city. This not only fuels the growth and development of the IT sector in the UAE but also leads to the creation of smarter, more efficient, and comfortable urban environments. The Smart Dubai initiative aligns with the broader vision of a technologically advanced and interconnected future.

Establishing an IT company in the UAE: basics

Stages of establishment

Stage 1:

Type and location

Choose between a free zone or domestic company.

Stage 2:

Business plan and documents

Create a business plan.
Gather required documents, including founder's passport and proof of business location.

Stage 3:

Application and license

Submit registration application.
After approval, obtain a business license.

Stage 4:

Banking and permissions

Open a UAE bank account.
Obtain necessary permits if applicable.

Required documents

Founder's passport for identity confirmation.
Business plan outlining goals and strategy.
Proof of business location.

Note:

Procedures and documents may vary based on company format and location. Seek advice from specialists for accurate registration.

Banking conditions for registering a bank account for IT companies in the UAE

Duplicates of documents of the organization and its founders. It is necessary to provide copies of the organization’s registration certificate, constituent agreement, charter, and other related documents. We also need copies of the passports of all the founders of the organization.
Organization's business strategy. The bank may require an organization's business strategy, which outlines the goals, strategies, and growth plans for your business. A business plan also helps the bank assess the financial stability of the organization and its potential.
Confirmation of the organization's address. The bank may request documents confirming the real address of the organization, such as a lease agreement for office space, an extract from the real estate register, or utility bills.

In addition to the above documents, additional data or documents may be required in accordance with bank policies and specific requirements. It is recommended to contact the bank of your choice directly, as well as consult with specialists in registering organizations in the UAE to receive detailed instructions and a list of necessary documents to open a bank account for your IT company.

Conclusion

Registering an IT company in the UAE presents numerous opportunities for the development and successful operation of businesses in a country striving to become a global information technology hub. The UAE government places great importance on IT sector development and offers various initiatives and programs to support entrepreneurs in this field.

One of the key advantages of registering an IT company in the UAE is the robust government support for IT sector growth. The government actively invests in infrastructure, financing, and resources to support IT companies. This includes the establishment of innovation parks, incubators, technology parks, and digital cities, creating favorable conditions for IT business development and growth.

The UAE is renowned for its diverse selection of free zones specializing in the IT industry. These free zones offer special economic conditions and tax benefits for registered companies. Businesses in these zones can fully own and control their operations while enjoying other advantages. The variety of free zones allows entrepreneurs to choose the most suitable location for company registration based on their specific needs, goals, and specialization.

In the past, offshore registration of IT companies in the UAE was popular, but opening bank accounts for offshore companies has become challenging due to international legislative changes and stricter transparency and anti-money laundering requirements.

Tax incentives are a crucial aspect of establishing an IT company in the UAE. The country offers an attractive tax regime with low corporate tax rates, along with customs benefits, access to financial markets, and international transaction capabilities.

The Smart Dubai initiative is another significant factor driving the growth of IT companies in the UAE. This government initiative aims to create an innovation ecosystem and a digital city. It provides unique opportunities for IT companies to collaborate with government agencies and contribute their solutions and services to Smart Dubai projects, opening additional avenues for IT project development and innovation.

The process of launching an IT company in the UAE involves several stages, from selecting the type of company and its registration location to developing a business plan and gathering necessary documents. After submitting an application and obtaining a license, opening a bank account and acquiring required permits are essential steps.

In conclusion, registering an IT company in the UAE offers a promising opportunity for entrepreneurs in the information technology sector. The UAE provides favorable conditions, tax incentives, government support, and access to innovative infrastructure for successful business development. By following the necessary steps and meeting registration requirements, entrepreneurs can establish and grow their IT companies in the UAE with confidence. For detailed advice and support in opening a company in this free zone, our specialists are available through the provided contact options on the website.