Understanding the importance of LLC is crucial for every businessman and entrepreneur before starting any business. Entrepreneurs can choose any business structure for their company, but a Dubai LLC license offers benefits, making it a popular choice among others.
LLCs thrive in Dubai because of its strategic location and business-friendly rules and regulations. Having an LLC license can help you run and grow your business without any difficulty. Before diving into the process of obtaining a Dubai LLC license and knowing the benefits of LLC company in UAE, let’s discuss the basics, what exactly an LLC is.
What is Dubai Limited Company?
In the world of business, there are four structures that can be selected to set up the business. Limited Liability Company is one of the four main business structures that combines the best parts of two other business structures corporation and partnership.
It is an easy and quick way to form and register a business. Moreover, an LLC provides more flexibility, protection, and benefits than other structures. These compelling benefits attract the attention of businessmen.
How to Open LLC Company in Dubai?
The UAE government has established rules and guidelines that should be followed for the formation of an LLC company. The systematic process has the following steps.
Choose Business Activity
The first step is to choose the business activity according to your preference and interest. Ensure that the selected activity falls in the listed activities by the Department of Economic Development (DED) Dubai.
An option of seeking help from professionals is also available that can guide you in choosing the right activity.
Select Company Name
After choosing the activity, register a trading name for the company. The selected name must be according to the government naming convention law.
Select Location
Selection of the right location is a challenging step as it contributes to the growth of the business. It is recommended that you choose a strategic location that is suitable for your business activity.
After selecting the perfect location, it is mandatory to attest to the rental contract by the Ejari. This is a crucial step to getting a trading license.
Get Initial Approval
To enter your company in the commercial registry, complete the paperwork and submit all the required documents to DED.
MOA and LSA Agreement
The Memorandum of Association and Local Service Agent agreement is also included in the documentation. In legal compliance, a reliable local sponsor is selected as a partner in business activities.
Acquire Trade License
After providing all the documents required by DED, you can acquire a trading license. Along with that certificate of incorporation, MOA and LSA are also provided. The Trading License will not only help you set up a company but also help in expanding it and enhancing its trustworthiness and reliability.
Benefits Of LLC Company
The key benefits of LLC company in UAE are promising and compelling. Eight major benefits are described below.
Tax Relaxation
Any limited liability company that is registered in a Free Zone is allowed to perform business activities outside the UAE without paying any tax. Moreover, activities can also be performed in GCC countries. However, companies located on the mainland have to pay 9% of their profits as taxes.
Businessmen and entrepreneurs consider one of the best advantages of LLCs is that they can save that amount and earn more profit from it.
Quick Process
Company formation is a time-consuming and challenging process; however, choosing an LLC as a company structure can save time as it is one of the easiest, quickest, and most affordable business structures. Usually, the LLC registration Dubai process is completed in 4 to 5 days, but LLC formation takes a few hours to register with DED.
Cost Effective
Business setup in Dubai is not considered affordable, but it can be cost-effective if you select an LLC structure for your company. This is because it eliminates the need for double taxation and extra application costs.
The transparency of the relevant authorities is another factor that makes it cost-effective. Dubai LLC company registration costs vary depending on the type of business, as some businesses need extra certificates and approvals from different authorities.
Liability Protection
LLC is a popular choice in the UAE because it protects the personal assets of all shareholders. According to the LLC agreement, if the company faces a loss in business, shareholders are not responsible for it. Only the money they invested in the business is at risk, while their other assets are secure.
Broad Range of Activities
In other business structures, a limited number of business activities are available to choose from. However, in LLC, more than 2000 legal business activities are listed by the DED. You are allowed to choose any activity that suits your interests. It can be related to agriculture, technology, and finance.
It might be possible that these activities vary in nature as it depends on the nature of the location. After selecting the activity, a trading license is provided so you can start business activities legally.
Freedom to Choose Location
If you choose LLC for your company formation, you will be able to select any location. It can be a Free Zone and Mainland. If your business activity demands access to the local market, then you are allowed to choose the mainland.
You can compare different locations and then choose the best location that aligns well with your selected activity. An option of seeking help from professionals is available, and they can help you in choosing the right location according to your business activity.
Networking Opportunity
Another advantage is that you can collaborate with the top class of the business community. Moreover, you get the opportunity to connect with suppliers, clients, and other members of the business industry to enhance your chances of success.
Multiple Visas
Another benefit that attracts the attention of every businessman is the opportunity to have multiple visas. When you choose an LLC as a business structure, you get an Investor Visa in Dubai. An investor visa allows you the opportunity to live in Dubai for a specified period, eliminating the need to renew a tourist visa.
Investor visas also facilitate the family members and allow them to stay with the visa holder for two to three years. It means you can apply for multiple LLC Dubai visas for family members.
Documents Required for Dubai LLC License
The following documents are required to get an LLC license from the Department of Economic Development
- Registration form
- Memorandum of association from public notary
- Business plan
- Proof of ownership
- Passport of investor and local sponsor
- Copy of Emirate ID
- No Objection Certificate (NOC)
- Passport sized images
Dubai LLC Company Registration Cost
Registering an LLC company can cost you AED 20,000 to AED 30,000. Along with that, the investor visa cost is between AED 4000 and AED 5500.
The cost can vary as it depends on three main factors:
- Type of business activity
- Employee you hire
- Services you provide
Conclusion
At the end of this article, we hope it provided you with a comprehensive understanding of the Dubai LLC license. Choosing an LLC structure for your business provides a number of benefits and combines the best parts of two other business structures: corporation and partnership.
It is a quick, easy, and affordable way to register your business in Dubai. The Dubai LLC company information provided above can help you obtain a license from DED.
