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How to Start a Software Company in Dubai

How to start a software company in Dubai, UAE
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Are you looking to start a software company in Dubai – the land of opportunity? If yes, you are at the right place!

In recent years, Dubai has established itself as the “Silicon Valley of the Middle East”. It is due to the presence of major companies and numerous smaller businesses offering custom software development services.

Dubai’s favorable business environment and thriving tech ecosystem make it the perfect place to launch your software company. But where do you start? Fret not, because we’ve got you covered. This blog will guide you through every step to open a software company in Dubai, from understanding the market to securing funding and beyond.

Starting a Software Company in Dubai

Dubai has become a hub for innovation and technology, making it an ideal location to start a software development company. The software industry in Dubai is thriving – thanks to its technologically advanced populace and high rates of internet usage. Additionally, the support offered by both federal and local governments has contributed to the overall growth and expansion of software companies in the city.

Also, the world-class infrastructure, business-friendly policies, and strategic location of Dubai make it easier for companies to access global markets. Dubai’s government is also actively investing in technology and innovation, providing opportunities for startups to grow and succeed.

Software Company License in Dubai

Obtaining a software company license in Dubai is an important step in setting up a successful business in the city. The Department of Economic Development (DED) is the primary authority responsible for issuing licenses for software companies in Dubai.

To obtain a license, you will be required to provide a range of documents, including a business plan, proof of address, a copy of your passport, and evidence of your company’s financial stability. You will also need to register your company with the Dubai Chamber of Commerce and Industry and the Dubai Municipality. Besides, you may be required to obtain additional permits and licenses, such as a commercial license, a work permit, and a value-added tax (VAT) registration, depending on the nature of your business.

Cost of Software Company License

When it comes to the cost of starting a software company, no single figure can be suggested. The cost of a software company license in Dubai varies depending on the type of license you are applying for and the size of your company. Generally, the cost of a business license in Dubai ranges from AED 5500 to AED 21, 185 depending on your jurisdiction and business activities.

Cost of Starting a Software Company in Dubai Mainland

    
Sr. No.ParticularsFee TenureAmount in AED
1Initial Approval FeesOne Time120.00
2Name Approval FeesOne Time620.00
3Tasheel FeesOne Time345.00
4Notary Verification FeesOne Time350.00
5MOA/LSA-Notary FeesOne Time1,200.00
6License Fees ApproximatelyPart- Annual12,500.00
7Immigration Card FeesAnnual750.00
8Stamp of the CompanyOne Time100.00
9Labour Card FeesOne Time1,000.00
11Investor Residence Visa FeesPart-2 Years4,200.00
 Total 21, 185

Cost of Starting a Software Company in UAE Freezone

Sr. No.ParticularsFee TenureAmount in AED
1License feesAnnual5500.00
2Immigration Card FeesAnnual2,000.00
3Stamp of the CompanyOne Time100.00
4Investor Residence visa FeesPart-2 Years5,000.00
 Total 12, 600

Similarly, for businesses opening a software company as a sole proprietorship in a free zone, the likely cost for initial setup may range from AED  5500 to AED 40, 000 along with an annual renewal fee.

Additionally, there may be other fees involved, such as documentation fees, legal fees, and office space rental costs. Keep in mind that these costs can vary based on multiple factors, such as the type of business activities you plan to conduct, the number of visas you require, and the location of your office.

Benefits of Opening a Software Company in Dubai

Are you an entrepreneur looking to establish software companies in the Middle East? Check out the following key benefits you can expect by opening a software company in Dubai.

  • Business-Friendly Environment

Software companies can easily operate and grow in Dubai as it offers a secure, stable, and business-friendly environment with a well-established legal framework, low corruption, and a welcoming attitude towards foreign investment.

  • Access to Talent

Dubai has a large pool of highly skilled and educated professionals possessing the required skillset, including user interface design, programming languages, and UX research from around the world. This makes it easier for you to find the talent needed to grow your business.

  • Tax Incentives

Dubai is best known for its tax-friendly environment. With a 0% personal and corporate tax rate in Dubai free zone, software companies can greatly benefit by eliminating their tax liabilities.

  • State-of-the-Art Infrastructure

Dubai has world-class infrastructure, including a modern airport, local cloud server centers, high-speed internet, and a well-developed transport system. This makes it easier for software companies to operate and reach their customers.

  • Growing Market

Dubai’s technology sector is rapidly expanding, with a growing demand for software solutions across a range of industries, including finance, healthcare, tourism, and construction.

  • Access to Networking Opportunities

Dubai enjoys a vibrant community of investors, entrepreneurs, and innovators, offering software companies valuable networking opportunities that can help them grow their businesses.

Documents Required to Open a Software Company in Dubai

To open a software company in Dubai, the following documents will be required:

  • Business plan
  • Passport copy of the owner/shareholder.
  • Visa copy of the owner/shareholder
  • Few name Choices for the company reservation.
  • Lease Agreement – Actual office or Virtual office

Steps to Open a Software Company in Dubai

The process of opening a software company in Dubai is relatively simple and involves the following steps:

Step 1: Determine the Business Structure

Decide on the type of company you want to set up, such as a limited liability company (LLC), a sole proprietorship, or a branch office of an existing company.

Step 2: Choose & Register a Trade Name

Select a trade name that is unique and not already in use by another company. Make sure this name does not entail any abbreviation or any words that are offensive or blasphemous. To legally establish your software company in Dubai, obtain approval from the Department of Economic Development (DED).

Step 3: Submit an Application

Complete the application process by applying for a trading license from the DED for approval of your trade name and business activities.

Step 4: Register for VAT

Businesses that want to open software company in Dubai must register for VAT.

Step 5: Open a Local Bank Account

Open a local bank account for your company to handle financial transactions.

Step 6: Obtain the necessary approvals and licenses

Depending on the nature of your business activities, you may be required to obtain additional approvals and licenses from various government agencies.

Types of Software Companies to Open in Dubai

Software development: Companies that specialize in developing custom software solutions for clients in various industries.

Cloud computing: Companies that provide cloud computing solutions, including platform as a service (PaaS), infrastructure as a service (IaaS), and software as a service (SaaS).

Mobile app development: Companies that design and develop mobile applications for iOS and Android platforms.

Web development: Companies that design and develop websites, e-commerce platforms, and other web-based applications.

Cybersecurity: Companies that provide cybersecurity solutions, including network security, data protection, and identity management.

Inventory Management:  Effective inventory management is crucial for the success of any organization, which is why inventory management systems have become so popular in recent years. These software solutions make it easier for managers to keep track of a large number of products in real-time, allowing them to make informed decisions and effectively manage their inventory.

How Avyanco Can Help You Setup a Software Company

Starting a software development company in Dubai can be a lucrative and exciting opportunity, but it requires careful planning, research, and preparation. If you want to start a software company in Dubai but don’t know where to start, let us help!

At Avyanco, we offer our valued clients up-to-date information and guide them throughout the business setup process in a thriving startup ecosystem in Dubai. So why wait? Take the leap and turn your software vision into a reality in the heart of the Middle East!

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About the Author

jashvant-avyanco-business-setup-consultancy-ceo

Jashvantkumar Prajapati

(Founder and CEO of Avyanco Group of Companies; Business Setup Consultancy, Avyanco Tax and Accounting LLC, and Avyanco Auditing LLC.)

He keeps a varied portfolio with core expertise in investment management, corporate structuring, commercial law, business consultancy, lead management, business planning and market research. Aspire to help potential entrepreneurs and investors to come ahead and form their companies in highly emerging economies like UAE.