businessman in Dubai with German flag

Setting up a company in Dubai, residence in Germany: A guide for entrepreneurs

Setting up a company in Dubai while maintaining your residence in Germany is an attractive option for many entrepreneurs. Dubai attracts with tax advantages, a dynamic business environment and a strategically favorable location. This guide highlights the essential requirements, tax aspects, legal framework and practical steps to consider when setting up a company in Dubai.

Key findings

  • Setting up a company in Dubai does not require relocation of residence to Dubai, but does require an appropriate local presence.
  • Dubai offers a competitive tax system and numerous economic advantages for entrepreneurs.
  • Avoiding double taxation requires a clear separation of business activities between Dubai and Germany.
  • Legal framework and compliance requirements in Dubai must be carefully observed.
  • Choosing the right company structure and opening a bank account are crucial steps in the startup process.

Requirements for setting up a company in Dubai

businessman in Dubai with German flag

Required documents

Various documents are required to set up a company in Dubai . These include a valid passport, a detailed business plan and proof of financial situation. Depending on the type of company, additional documents may be necessary.

Requirements for the managing director

The managing director must meet certain requirements. These include a clean police record and relevant professional qualifications. In some cases, proof of professional experience is also required.

Office and business address

A physical business location such as an office is often necessary. Alternatively, you can also set up a free zone in Dubai , which offers several advantages. No physical presence is required, which makes setting up the company easier.

Starting a company in Dubai is suitable for almost all industries and sectors. The emirate offers extremely business-friendly conditions.

Tax aspects when residing in Germany

businessman in Dubai with German flag, tax documents

Avoid double taxation

The lack of a double taxation agreement (DTA) between Germany and the UAE can lead to tax challenges in some cases. For example, shifting tax residency to Dubai can be difficult for those with unlimited tax liability in Germany and German nationals, which means that the right to tax often remains with Germany. Nevertheless, there may be scope for employees who give up their German residence and are only subject to limited tax liability in Germany so that the income earned in the UAE is not subject to tax in Germany.

Tax advantages in Dubai

Even if individuals do not pay income tax in Dubai, they should still find out about the tax obligations in their country of origin or residence. In some countries, the so-called worldwide income principle applies, which states that all of a person's income is taxed, regardless of where it was earned. It is therefore advisable to familiarize yourself with the tax laws of your own country and, if necessary, seek professional advice.

Tax obligations in Germany

Entrepreneurs who maintain their residence in Germany must be aware of their tax obligations. These include:

  • Income tax : All income, including that earned in Dubai, must be taxed in Germany.
  • Trade tax : If the business ideas are also implemented in Germany, trade tax may be payable.
  • Sales tax : Sales tax may be payable on services or deliveries of goods to Germany.
It is extremely important to seek professional advice in advance in order not to overlook any tax risks.

Legal framework in Dubai

business setup in Dubai with legal documents

The legal requirements in Dubai are diverse and can vary depending on the type of company and industry. It is important to obtain comprehensive information in advance and, if necessary, seek legal advice. A cost calculator can help you get a better overview of the fees and costs involved.

There are various legal structures for companies in Dubai, including:

  • Mainland Companies : These offer the opportunity to conduct business without restrictions on the type of business activities and choice of location both within the UAE and internationally.
  • Free zone companies : These are located in special economic zones and offer tax advantages and 100% foreign ownership.
  • Offshore companies : These are designed for international business and also offer tax advantages.

Contract law in Dubai is based on civil law and is heavily influenced by Islamic principles. Business owners should ensure that their contracts comply with local laws and meet all compliance requirements. Compliance with legal requirements is crucial to the long-term success of the business.

Anyone who wants to emigrate to Dubai should also find out about topics such as schools for children in Dubai, jobs in Dubai and insurance in Dubai. The tax haven of Dubai offers many advantages, but also some challenges that need to be overcome.

Practical steps to start a company

businessman starting a company in Dubai with a German background

Choosing the right company structure is crucial to the success of your business operations in Dubai. You can choose between Free Zone, Mainland or Offshore company structures. Each of these structures has its own advantages and disadvantages that should be carefully considered.

The registration process in Dubai can be complex and requires compliance with various legal requirements. A business formation expert will guide you through the necessary steps to start your business. Note that the requirements may vary depending on your specific business formation.

A business bank account is essential for handling your financial transactions. Opening a bank account in Dubai requires certain documents and approvals from certain authorities. Make sure you have all the necessary documentation ready to avoid delays.

Note: Requirements may vary depending on your specific business formation. Be sure to thoroughly research the next steps for your chosen structure.

Management and presence in Dubai

Business meeting in Dubai with German entrepreneur

The managing director plays a central role in setting up a company in Dubai. He is responsible for ensuring compliance with all legal requirements and managing the day-to-day business. It is important that the managing director is either based in Dubai or is on site regularly to manage the business effectively.

A strong local presence is crucial for the success of a business in Dubai. This includes not only having a physical office but also hiring local staff. A local presence makes it easier to build and maintain relationships with customers and business partners.

Moving to Dubai with family can facilitate integration and understanding of local culture and business practices.

Regular travel and stays in Dubai are necessary to ensure local management. This is especially important if the managing director does not live permanently in Dubai. It is advisable to travel to Dubai at least once a month to personally monitor the business and make important decisions.

Advantages and challenges of starting a company in Dubai

Dubai offers a variety of economic advantages for business start-ups. Tax freedom is one of the biggest incentives, as companies benefit from exemption from corporate and income taxes. There are also numerous double taxation avoidance agreements with various countries around the world.

Other economic benefits include:

  • Strategic location between East and West
  • Access to a large market
  • Highly developed infrastructure

Despite the many advantages, there are also some challenges and risks that must be taken into account when setting up a company in Dubai. Cultural customs from the Arab-Muslim and Indian cultural areas may require adaptation. In addition, there is currently no valid double taxation agreement between Germany and the United Arab Emirates, which can make international cooperation more difficult.

The long-term prospects of starting a business in Dubai are promising. The city not only offers economic advantages, but also a high quality of life. Entrepreneurs who choose Dubai can benefit from an innovative atmosphere and numerous business opportunities.

Benefits of living in UAE include not only tax incentives, but also a high quality of life and a dynamic business environment.

Setting up a company in Dubai offers numerous advantages, such as tax incentives and strategic location, but also challenges that must be overcome. Find out more about the options and how we can help you. Visit our website for detailed information and individual advice.


Setting up a company in Dubai while maintaining residency in Germany is an attractive option for entrepreneurs who want to benefit from the tax advantages and dynamic business environment in the Emirates. However, it is essential to pay close attention to the legal and tax requirements in both Germany and Dubai. A solid local presence in Dubai, including an office and a managing director, is crucial to meet the requirements and ensure successful business operations. With the right planning and support, this step can be not only legally sound, but also economically advantageous.

frequently asked Questions

Can you set up a company in Dubai and keep your residence in Germany?

Yes, it is possible to set up a company in Dubai while maintaining residency in Germany. However, it is important to establish an appropriate presence in Dubai through an office and a local managing director.

Is it necessary to reside in Dubai to set up a company?

No, residency in Dubai is not mandatory. However, there must be a physical base in Dubai, including an office and a locally based managing director.

What tax advantages does setting up a company in Dubai offer?

Dubai offers a competitive tax system with a profit tax of around nine percent. There are also numerous government grants and tax incentives.

How can you avoid double taxation?

To avoid double taxation, proof of actual business location in Dubai must be provided. This requires own premises, staff and a local business address.

What legal framework applies to companies in Dubai?

There are specific legal requirements in Dubai that vary depending on the legal form of the company. It is important to be aware of the relevant laws and compliance rules.

What are the challenges of starting a company in Dubai?

Challenges include the need for a local presence, compliance with legal requirements and adapting to Dubai's cultural and business practices.

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