After listing all the advantages of the UAE as a jurisdiction for doing business, it is time to explore in more detail the types of companies you can choose when planning to enter this market.
Let's start with Mainland companies.
The UAE offers Ukrainian entrepreneurs the opportunity to conduct business in the Mainland (the mainland part of the UAE), which has its advantages. Here are some of them:
Broad Market
The UAE Mainland provides access to a broad market, including local and foreign consumers. This enables Ukrainian entrepreneurs to attract new customers and expand their client base.
More Flexibility
Mainland companies have greater flexibility in conducting business, allowing entrepreneurs to make decisions related to strategy, expansion, choosing partners, and other aspects. Specifically, there is no requirement for partnership with a local citizen. The specific rules and regulations of Free Zones do not bind mainland companies.
Access to Local Resources
Mainland UAE provides access to many local resources, such as the workforce, suppliers, services, and infrastructure. This facilitates smooth business operations and provides support for business growth.
Global Recognition
Mainland companies have higher global recognition as they are registered in the mainland territory of the UAE. This can give an advantage in collaborating with international partners, attracting investments, and building client trust.
More than 1000 different types of activities allow Ukrainians to be 100% founders of the company (just like any foreigner), with exceptions only in strategic sectors (oil refining, gas extraction, banking, construction, etc). Mainland companies can be specialized and have a simplified procedure for opening a bank account, as financial institutions inherently see a close connection with the jurisdiction.
Taxation
It is a well-known fact that Mainland companies pay 5% VAT on their turnover and will be required to pay 9% corporate income tax starting from January 1, 2024.
However, in light of the latest clarifications by the Federal Tax Authority in June 2023, most companies registered in Free Zones will also be subject to a 9% income tax rate. In this context, the main benefit of tax optimization in Free Zones is lost.
Let's start with Mainland companies.
The UAE offers Ukrainian entrepreneurs the opportunity to conduct business in the Mainland (the mainland part of the UAE), which has its advantages. Here are some of them:
Broad Market
The UAE Mainland provides access to a broad market, including local and foreign consumers. This enables Ukrainian entrepreneurs to attract new customers and expand their client base.
More Flexibility
Mainland companies have greater flexibility in conducting business, allowing entrepreneurs to make decisions related to strategy, expansion, choosing partners, and other aspects. Specifically, there is no requirement for partnership with a local citizen. The specific rules and regulations of Free Zones do not bind mainland companies.
Access to Local Resources
Mainland UAE provides access to many local resources, such as the workforce, suppliers, services, and infrastructure. This facilitates smooth business operations and provides support for business growth.
Global Recognition
Mainland companies have higher global recognition as they are registered in the mainland territory of the UAE. This can give an advantage in collaborating with international partners, attracting investments, and building client trust.
More than 1000 different types of activities allow Ukrainians to be 100% founders of the company (just like any foreigner), with exceptions only in strategic sectors (oil refining, gas extraction, banking, construction, etc). Mainland companies can be specialized and have a simplified procedure for opening a bank account, as financial institutions inherently see a close connection with the jurisdiction.
Taxation
It is a well-known fact that Mainland companies pay 5% VAT on their turnover and will be required to pay 9% corporate income tax starting from January 1, 2024.
However, in light of the latest clarifications by the Federal Tax Authority in June 2023, most companies registered in Free Zones will also be subject to a 9% income tax rate. In this context, the main benefit of tax optimization in Free Zones is lost.