With the government allowing 100% foreign ownership, foreign investors have renewed their interest in the process of business setup in Abu Dhabi mainland. Setting up a company in Abu Dhabi mainland is a lucrative business idea as it comes with key benefits such as freedom to trade anywhere in the UAE and flexibility in expanding the business, low rental schemes etc. As dramatic changes are happening in the landscape of business setup in Abu Dhabi, it is worthwhile to understand the advantage of setting up a company on the mainland. Read ahead.
1. Hundred Percent Foreign Ownership in Abu Dhabi mainland
Having 100% foreign ownership in Abu Dhabi mainland companies has become a reality starting from June 2021. Unlike in the previous times, foreign investors can have full ownership in companies with a commercial license. ADDED has published a list of more than 1000 commercial activities that are eligible for full foreign ownership. Companies established in Abu Dhabi under such activities need not engage a UAE National Sponsor holding at least 51% of shares in the company.
2. Ability to Trade Anywhere in UAE
Setting up a company in Abu Dhabi mainland is the best option for foreign investors who wish for wider market access. A mainland company allows you to trade directly with the consumers anywhere in the UAE market. Apart from that if your company plans to undertake government projects or offer services to the government, undertaking company formation in Abu Dhabi mainland is recommended.
For instance, starting a restaurant or cafeteria in Abu Dhabi becomes more profitable when you register it as a mainland entity. More customers will visit your cafeteria if it is incorporated in the mainland. This is also true for an e-commerce company where the delivery part becomes smooth when set up as a mainland company. The other option for you is a free zone, where you can trade only within the free zone. Starting a restaurant inside a free zone means you can serve your food to the customers living, working or doing business inside the free zone.
3. No Corporate or Personal Tax
Businesses can leverage the low-tax regime that exists in the UAE. Companies set up in Abu Dhabi need not worry about corporate tax or personal. The only form of tax that is levied on businesses is Value Added Tax (VAT) at a 5% rate. Investors can consult with business setup consultants in Abu Dhabi to know more about VAT.
4. No Compulsion of Minimum Capital For The Formation of the Mainland Company
The UAE Companies Law doesn’t mandate any specific amount as the minimum share capital. However, the companies must have sufficient capital to meet the requirements of company incorporation in Abu Dhabi. The advantage here is that the investors are not required to deposit the share capital into any registered bank in the UAE. Company formation consultants in Abu Dhabi can shed more light on the minimum share capital requirements.
5. No Annual Audits
Companies incorporated in Abu Dhabi mainland are not mandated to conduct annual audits. Generally, mainland companies carry out financial audits voluntarily to satisfy lenders, investors or any other stakeholders. Business consultants in Abu Dhabi recommend investors maintain books of accounts and conduct annual audits regularly to ensure the company is in good health.
6. Affordable Locations to Set Up Office space
Registering a mainland company in mainland provides you with the benefit of renting or leasing a commercial space anywhere in Abu Dhabi. If you are planning to start a shop, getting a mainland license is better. With a mainland license, your shop can be opened in business districts such as Al Reem Island, Mussafah, Al Khalidiyah, Hamdan Street etc. These places are known to be thriving commercial centres with cheaper rental schemes. These areas are the best places in Abu Dhabi for setting up office space as well.
7. Excellent Infrastructure in Abu Dhabi
Abu Dhabi is the capital and the largest emirate in the UAE. The city is a dynamic hub for a wide range of businesses and industrial activities. Abu Dhabi is the wealthiest emirate in the UAE and holds 95% of the oil production in the UAE. These factors along with a healthy lifestyle and educational background of the residents, considering business setup in Abu Dhabi is recommended for foreign investors. Furthermore, Abu Dhabi is known for its robust infrastructure with the Etihad rail project to be opened soon.
How can Jitendra Business Setup Consultants Help?
The process of business setup in Abu Dhabi mainland needs you to have a deep understanding of the laws and regulations. Some activities known as special activities require approval from relevant ministries and government bodies. This is where you need the assistance of the best business setup consultants in Abu Dhabi such as Jitendra Business Consultants (JBC).
Our highly qualified business setup advisers can help you with all aspects of company formation in Abu Dhabi including visa processing, documentation, bank account opening etc. We also help you with compliance requirements such as VAT return filing, audit, Economic Substance Regulation (ESR), Ultimate Beneficial Ownership (UBO) etc. Company incorporation in Abu Dhabi can be hassle-free with the right business setup partner such as JBC.