Business
UAE — Business: Sole Proprietorship (Sole Establishment)
A UAE sole establishment (sole proprietorship) is licensed in the name of one natural person; the business and individual are legally inseparable. UAE/GCC nationals can form any type (industrial, commercial, tourism, or professional). Foreign nationals may only obtain a professional license and must appoint a Local Service Agent (LSA) to register the sole establishment. Setup costs run AED 15,000-25,000, with registration typically completing in 3-5 days to 1-2 weeks depending on documentation completeness (some mainland setups take 8-10 weeks in practice). Since the 2023 Corporate Tax regime, sole proprietorships are subject to UAE Corporate Tax: the first AED 375,000 of taxable income is exempt, with income above that taxed at 9%.
Key facts
- UAE/GCC nationals can form any sole-establishment activity type; foreign nationals are restricted to professional licenses.
- Foreign nationals must appoint a Local Service Agent (LSA) to register a sole establishment.
- Setup cost: AED 15,000-25,000; registration typically 3-5 days to 2 weeks, though some mainland cases take longer.
- Subject to Corporate Tax: first AED 375,000 exempt, 9% above that threshold.
Costs
- Setup cost: AED 15,000-25,000
Timelines
- Registration (typical): 3-5 days to 2 weeks
Required documents
- Professional license application
- Local Service Agent agreement (foreign nationals)
Common mistakes
- Assuming a sole establishment shields personal assets from business liability — the business and individual are legally inseparable.
- Not budgeting for the Local Service Agent requirement as a foreign national.