Business Setup in UAE: Why It Feels Like a Gold Rush. Business setup in UAE offers strong infrastructure, a business friendly tax system that is good for businesses and a location that connects East and West. However for every business that succeeds many others fail before they even get started.
Most businesses fail not because of a lack of money or a bad product. Setting up a business in the UAE can be very complicated. Without proper approvals your company may face serious challenges from the beginning.
Here are three common mistakes businesses make when starting out in the UAE.
- Picking the Right Business Activity
In some countries you can register a company and then decide what you want to do later. In the UAE your business license is connected to what your business does from the very start.
The Department of Economy and Tourism and the Free Zone authorities have a lot of activities listed. Many owners make the mistake of choosing a category that does not cover what their profession actually does.
For example if you have a consultancy license but you start trading goods you are breaking the rules of your license. This can result in fines you may not be able to open certain bank accounts and you might even have your visa canceled.
It is also not easy to change your business activity after you have your license. You have to make changes and pay more fees, which you could have avoided.
- Paying Too Much to Set Up Your Business
The UAE has many different Free Zones and each one has its own fees, visa costs and office requirements. Because of this many new business owners fall into the trap of paying for things they do not need.
For instance some Free Zones require you to rent an office while others let you use a flexi-desk. If you are working alone paying for an office in downtown Dubai just to get a license is a waste of money.
Some consultants also hide fees in the fine print. You might think you are paying an amount for a license but then you find out that visas, Emirates IDs and medical checks cost extra. This can use up a lot of your startup money before you even make a sale.
- Not Understanding UAE Business Rules
Not knowing the rules is a problem for many businesses in the UAE. The UAE is no longer a place where you can do business without following rules. It is now a market with rules to follow.
Getting a bank account can be harder than getting a license. Banks have rules and if you are not clear about what your business does they will not give you an account. Without a bank account your business cannot survive.
You also have to pay taxes. The UAE has a 9% tax and a 5% VAT. Many business owners think they do not have to pay taxes because they’re small but if you do not register you can get penalties that are worse than the taxes themselves.
Some businesses also have to register with the GoAML portal. If you do not follow these rules you can get in trouble.
When you make these mistakes you can get stuck in a cycle of delays and rejections. You spend months waiting for a visa while your rent is due and your competitors are moving ahead. Getting everything from the start is not just a good idea it is necessary for your business to survive.
That’s where Don and company global solutions becomes your solution . We have seen these problems before. We do not just do paperwork we give you a plan.
We make sure you are following all the rules, from the start.. We help you find the most cost-effective way to set up your business.
In short do not let your firm fail before it starts. Let us help you build your dream that will last.
Contact. Company Global Business Solutions today and lets get your UAE business started the right way.