Glossary
UAE setup terms, in plain English.
Every term you’ll meet on a licence, a visa application, or a quote — defined the way we’d explain it on a call, not the way a law firm would.
A
- ADGM
- Abu Dhabi Global Market — Abu Dhabi's common-law financial free zone, the counterpart to Dubai's DIFC. It runs on English-law principles with its own courts and registrar. Founders use ADGM for holding structures — SPVs and Foundations that sit on top of an operating company — rather than for day-to-day operating business. Costs are quoted case by case; expect a meaningful premium over a standard operating free zone. ADGM in detail →
- Apostille
- A simplified form of document legalization under the Hague Convention: one stamp from the issuing country's competent authority makes a document valid in other member states. The UAE joined the convention in 2023, so documents from member countries (most of Europe, the UK, India) can usually be apostilled instead of going through the longer embassy attestation chain. Banks and registries still decide which they accept, so confirm before paying for either.
- Attestation
- The multi-step legalization chain that proves a foreign document is genuine: notary, then the issuing country's foreign ministry, then the UAE embassy there, and finally the UAE Ministry of Foreign Affairs. Required for documents like degrees (for some visa roles), marriage certificates (family sponsorship), and corporate documents from non-Hague countries. Where the apostille route is available it is faster and cheaper — attestation is the fallback.
B
- Bank reference letter
- A letter from your existing bank confirming you hold an account in good standing, usually stating how long the relationship has run. UAE banks ask for it during business account opening as part of KYC — it is one of the simplest ways to show financial history when you have no UAE footprint yet. Request it early: some banks take a week or more to issue one, and a letter older than about three months may be rejected.
C
- Corporate service provider
- A licensed firm that incorporates and administers companies for clients — formation, licence renewals, registered addresses, visas, and compliance filings. In holding registries like RAK ICC, working through one is mandatory (there it is called a registered agent). Quality varies enormously; the useful test is whether the provider quotes an all-in price and explains the structure, or just sells the cheapest licence. StartSmart is a corporate service provider with an advisory-first model.
- Corporate tax
- The UAE federal tax on business profits, in force since June 2023. The rate is 0% on taxable profit up to AED 375,000 and 9% above that, as of 2026. Free-zone companies can keep 0% on qualifying income if they meet the Qualifying Free Zone Person conditions. Every company — including free-zone and zero-revenue companies — must register with the FTA and file an annual return. There is still no personal income tax. UAE corporate tax in 2026 →
D
- DED
- Department of Economic Development — the government body in each emirate that licenses mainland companies (in Dubai now branded Dubai Economy and Tourism). A DED licence is what lets a business trade directly with customers inside the UAE, take retail premises, and bid for government work. If your customers are international, you generally do not need one — a free zone is the default route.
- DIFC
- Dubai International Financial Centre — Dubai's common-law financial free zone, with its own English-law framework, courts, and registrar. For most founders it is not where you run an operating business; it is where you hold things. DIFC SPVs, Prescribed Companies, and Foundations hold property, equity, and IP on top of an operating company. It carries the highest international credibility of the UAE holding jurisdictions and is priced accordingly — our DIFC SPV incorporation starts from AED 23,090. DIFC in detail →
- DMCC
- Dubai Multi Commodities Centre — Dubai's premium operating free zone, centered on Jumeirah Lakes Towers, strongest for trading and commodities businesses and consistently ranked among the world's top free zones. It costs more than RAKEZ or IFZA and the compliance is heavier, so it earns its keep when counterparties, suppliers, or trade-finance banks expect the DMCC name. We quote DMCC case by case rather than from a fixed list. DMCC in detail →
- Dual licence
- A scheme that lets a free-zone company also hold a mainland licence (or vice versa) so one business can serve both international and UAE-resident customers. Available in specific combinations — for example DIFC and ADGM dual licensing with their home emirates' DED. It is the exception, not the default: most founders are better served by one clean free-zone entity, adding a mainland entity only when real local trade justifies it.
E
- E-channel
- The federal online immigration system that free-zone and certain other companies must register with before they can process entry permits and visas. Registration involves a fee and a refundable deposit, and it has to stay active for any visa work to go through. Your formation provider normally handles it as part of the first visa — it matters to you mainly as a line on the quote and a step on the timeline.
- Economic substance
- Having real activity where your company is registered — management decisions taken in the UAE, adequate people and premises, expenses that match the business. Substance is what separates a tax setup that works from one that collapses under review: it underpins Qualifying Free Zone Person status, bank account approval, and your home country's view of whether the company is genuinely UAE-based. A licence alone is not substance.
- Ejari
- Dubai's official tenancy-registration system. Registering your lease in Ejari produces the certificate that government bodies treat as proof of a real address — needed for a Dubai mainland licence, many visa applications under mainland companies, and utilities. Free-zone companies use their zone's lease or flexi-desk agreement instead; Ejari is specifically a Dubai mainland and residential mechanism. Other emirates run their own equivalents.
- Emirates ID
- The UAE's national identity card, issued to every resident as part of the visa process. You need it for almost everything practical: bank accounts, SIM cards, tenancy contracts, government portals. Biometrics are captured in the UAE after the medical fitness test, and the card's validity matches your residence visa. The government fee is AED 370 per application, which we pass through at cost.
- Employment visa
- A UAE residence visa sponsored by a company for someone on its payroll — the standard route for staff, and often for founders who take a salary from their own company. Issued against the company's visa quota, valid two years in free zones, and processed through the same chain as any residence visa: entry permit, medical test, Emirates ID, stamping. Our standard 2-year visa processing starts from AED 6,375 depending on jurisdiction.
- Establishment card
- The immigration file every UAE company needs before it can sponsor visas — also called an immigration card. It registers the company with the immigration authority and must stay valid (renewed annually) for any visa under the company to be processed or remain valid. The cost is AED 3,050 for a new card and AED 3,250 on renewal. It is the one-off step founders most often forget when comparing quotes. Full pricing →
F
- Flexi desk
- A shared desk in the free zone's business center that satisfies the licence's minimum physical-presence requirement — the entry-level office for remote-first companies. It keeps costs down while still giving you a legal registered address and, in most zones, eligibility for a small visa quota. If you later need real premises you upgrade; nothing about a flexi desk limits what the company can do internationally.
- Foundation
- A legal entity (available in DIFC, ADGM, and RAK ICC) that holds assets without shareholders — it owns itself, run by a council under a charter for named beneficiaries. The UAE's nearest equivalent to a trust, used for succession planning, asset protection, and holding property or company shares across generations. It sits on top of operating companies, never replaces them. Our DIFC Foundation incorporation starts from AED 31,358.
- Free zone
- A licensed economic zone with its own company registrar, offering 100% foreign ownership, fast remote setup, and access to the 0% corporate-tax rate on qualifying income. The default route for international and online businesses — selling abroad, to other free-zone companies, or running a remote team. The one structural limit: a free-zone company cannot sell directly to UAE-resident customers; that is what mainland is for. How UAE free zones work →
- FTA
- Federal Tax Authority — the UAE's tax administration. The FTA runs corporate tax and VAT: registrations, the EmaraTax portal, returns, refunds, audits, and penalties. Every UAE company must register with the FTA for corporate tax regardless of size; VAT registration is separate and threshold-based. Most penalties we see are for missed registrations and late filings, not for tax owed — calendar discipline is the whole game.
G
- Golden visa
- A long-term UAE residence visa (10 years, renewable) that is not tied to an employer or company sponsorship. Common routes include AED 2 million in property, qualifying investments, and certain professional categories. It removes the 2-year renewal cycle and survives changes in your business. Our investor and golden visa processing starts from AED 15,250, on top of whatever the route itself requires you to hold or invest.
I
- IFZA
- International Free Zone Authority — a Dubai-issued operating free zone built for service businesses and consultants, with one of the broadest activity lists in the UAE: professional and commercial activities can sit together on one licence. Flexi-desk based and fully remote to set up. Our IFZA formation starts from AED 16,575 for a zero-visa licence, or from AED 16,925 with one visa allocation, year one including VAT. IFZA in detail →
- Initial approval
- The registrar's first green light: confirmation that the proposed company — its name, activities, and shareholders — can proceed to licensing. It is not a licence and does not let you trade; it reserves your slot while you complete documents, sign the MOA, and pay licence fees. In most free zones initial approval takes days, and the conditions attached to it tell you early whether an activity needs external regulator approvals.
- Investor visa
- A UAE residence visa issued to someone who owns shares in a UAE company — the standard route for founders who set up a free-zone company and want residency through it. Functionally similar to an employment visa (2-year validity in most free zones, same medical and Emirates ID chain) but tied to ownership rather than a job. The company needs a visa allocation and a valid establishment card first.
K
- KYC
- Know Your Customer — the identity and background checks that registrars, banks, and service providers must run before working with you. Expect to provide a passport, proof of address, a source-of-funds explanation, and a clear description of the business. Clean, consistent KYC is the single biggest factor in how fast your bank account opens; vague answers and mismatched documents cause more delays than any government process.
L
- Licence activity
- The specific business activities printed on your trade licence, chosen from the registrar's approved list. They define what the company may legally do — and they drive cost, external approvals, banking questions, and which zones fit. Too narrow and you amend later; too vague and banks push back. Picking activities is the highest-leverage fifteen minutes of a formation, which is why our diagnostic is anchored on it. 5-minute diagnostic →
- Local service agent
- A UAE national appointed to certain mainland professional licences where full foreign ownership applies but the law still requires a local administrative agent. The agent holds no shares and no profit entitlement — they are paid a fixed annual fee to handle government liaison. Far less significant than the old 51% local-partner rule, which has been gone for most activities since 2021. Many activities now need no agent at all.
M
- Mainland
- A company licensed by an emirate's DED to trade anywhere in the UAE — the route you take when your customers are inside the country: retail, restaurants, local services, government contracts. Most activities now allow 100% foreign ownership. It costs more than a free zone and the office requirement is real. If your revenue is international, mainland is usually overkill; choose it for local market access, not by default. Dubai mainland in detail →
- Medical fitness test
- The mandatory health screening (blood test and chest X-ray) every residence-visa applicant completes at an approved UAE center after entering on the entry permit. Results typically come back within days, and fast-track options exist. The government fee is AED 360 per applicant, passed through at cost. A failed test for specific conditions can block the visa, but for the vast majority it is a routine half-morning errand.
- MOA
- Memorandum of Association — the company's constitutional document, setting out shareholders, the shareholding split, share capital, activities, and management powers. Signed at incorporation and amended whenever ownership or structure changes. In free zones it is largely standardized by the registrar; on the mainland it carries more weight and historically required notarization. Read the manager-powers clause carefully — it determines who can bind the company at the bank.
N
- Name reservation
- Reserving your company name with the registrar before incorporation. UAE naming rules block religious references, some country names, and anything resembling existing brands; using a personal name generally requires the full name, not initials. The reservation holds the name for a limited window while formation completes. A rejected name is one of the most common avoidable delays — have two backups ready before you submit.
- NOC
- No Objection Certificate — a letter confirming that a party does not object to an action. UAE processes ask for NOCs in many places: from a current sponsor in some visa-status changes, from a landlord, from a regulator, or from a free zone for activity changes. When a process stalls, the missing piece is often an NOC nobody mentioned upfront — ask for the full document list at the start.
- Nominee
- A person or company that appears in official records — as shareholder or director — on behalf of the real owner. Legitimate uses exist in institutional structures, but for SME founders nominee arrangements are mostly a red flag: UBO rules require disclosure of the real owner anyway, banks treat undisclosed nominees as a deception risk, and you have handed legal control to someone else. We do not recommend or provide them; structure properly with an SPV or Foundation instead.
O
- Offshore
- UAE companies that exist only to hold assets — no UAE operations, no visas, no physical presence required. RAK ICC is the main offshore registry. It is the cheapest way to hold shares or international assets through a UAE entity, but the limits are real: no UAE operating activity and harder local banking. For most founders an offshore vehicle is a layer above an operating company, not a substitute for one.
P
- Power of attorney
- A notarized document authorizing someone to act on your behalf — sign incorporation papers, collect documents, deal with authorities. POAs are what make fully remote UAE formations work when a signature must happen in person. Issued abroad, a POA usually needs attestation or an apostille before UAE bodies accept it. Scope it narrowly: a specific-purpose POA, not a general one, is almost always the right call.
- Prescribed Company
- DIFC's streamlined SPV regime — a lighter, cheaper class of DIFC company for pure holding purposes, available when the structure has a qualifying connection (for example, ownership links to the GCC or to DIFC entities) or a qualifying purpose. You get the DIFC's common-law framework and registry credibility without full operating-company costs. It is the vehicle behind most DIFC SPV conversations, including holding UAE property.
Q
- Qualifying Free Zone Person
- The corporate-tax status that lets a free-zone company pay 0% instead of 9% on its qualifying income. The conditions are real: adequate substance in the zone, audited financial statements, staying within de-minimis limits on non-qualifying revenue, and not electing into the standard regime. Fail a condition and you lose the rate — generally for five years, not just for the year of the breach. UAE tax for founders →
- Qualifying income
- The income categories taxed at 0% for a Qualifying Free Zone Person — broadly, transactions with other free-zone companies, defined qualifying activities (such as trading from designated zones, fund and wealth management, manufacturing), and income from foreign customers for most service businesses. Mainland UAE sales generally fall outside it. The detail sits in ministerial decisions and turns on your exact activity, so map your revenue lines before assuming 0%. UAE corporate tax in 2026 →
R
- RAK ICC
- Ras Al Khaimah International Corporate Centre — the UAE's main offshore registry. RAK ICC companies hold assets (shares, international investments, property in approved cases) but cannot operate in the UAE or sponsor visas, and must be set up through a registered agent. It is the cheapest UAE holding layer; the trade-off versus DIFC and ADGM is a civil-registry vehicle without their common-law courts and with lower international recognition. RAK ICC in detail →
- RAKEZ
- Ras Al Khaimah Economic Zone — the cheapest serious operating free zone in the UAE, and the one we file most for cost-driven international businesses. Broad activity list, real industrial parks if you ever need premises, and visas issued like any other zone. Our RAKEZ formation starts from AED 9,150 for a zero-visa licence in year one, or from AED 15,150 with one visa allocation, including VAT. RAKEZ in detail →
- Registered agent
- The licensed intermediary that offshore registries like RAK ICC require between the company and the registrar — you cannot incorporate or file there directly. The agent submits filings, maintains records, and provides the registered address. In operating free zones the role does not formally exist, but a corporate service provider performs the equivalent job. Agent quality determines how painful renewals and amendments are, so choose on responsiveness, not just fee.
S
- SPV
- Special Purpose Vehicle — a company that exists to hold assets, not to trade: shares in your operating company, UAE property, IP, or investments. In the UAE you form SPVs in DIFC, ADGM, or RAK ICC, and they sit on top of an operating company — never instead of one. The point is separation: assets in a clean holding layer, business risk in the operating entity below it. DIFC SPV setup →
T
- Trade licence
- The document that brings a UAE company to life — issued by a free-zone registrar or the DED, listing the company's legal name, activities, and validity period. Renewed annually, with multi-year options in several zones. Everything else hangs off it: establishment card, visas, bank account, tax registrations. When we quote a formation, the licence is the anchor line — our pricing page lists the current from-prices per jurisdiction. Formation pricing →
- TRN
- Tax Registration Number — the number the FTA issues when a company registers for a tax. VAT and corporate tax registrations produce separate TRNs. Customers and suppliers use your VAT TRN to validate invoices, and you must show it on every tax invoice once VAT-registered. A company that has not crossed the VAT threshold legitimately has no VAT TRN yet — that is normal, not a red flag.
U
- UBO
- Ultimate Beneficial Owner — the human being who ultimately owns or controls a company, traced through any layers of holding entities. UAE registrars and banks must identify UBOs (generally anyone holding 25% or more) and companies must keep a UBO register. Layered structures are fine; hidden ownership is not. If your structure cannot name its UBOs cleanly on one page, fix the structure, not the disclosure.
V
- VAT
- The UAE's 5% value-added tax on most goods and services. Registration is mandatory once taxable supplies exceed AED 375,000 in a rolling 12 months and voluntary from AED 187,500, as of 2026. Exports of services to customers outside the UAE are generally zero-rated — many free-zone companies register, reclaim input VAT, and charge 0% on foreign revenue. Filing runs quarterly for most SMEs through the FTA's portal.
- Virtual office
- A registered address and mail handling without dedicated physical space — in free zones this is effectively what a flexi-desk package provides, and it satisfies the registrar. The limits show up elsewhere: banks increasingly probe for substance, mainland licences mostly require real premises (with Ejari), and Qualifying Free Zone Person status needs adequate substance. A virtual office is a legitimate starting point, not a permanent answer for a growing company.
- Visa quota
- The number of residence visas a company may sponsor, set by its licence package and office type. A flexi-desk licence typically carries a small quota; bigger premises earn bigger quotas. Buy the quota you will actually use — unused allocation is money spent on optionality, and upgrading later is routine in most zones. Model the visa math in our setup cost calculator before you choose a package. Setup cost calculator →
- Visa stamping
- The final step of the residence-visa process: after the entry permit, medical fitness test, and Emirates ID biometrics, the residence visa is issued and linked to your passport — digitally now, replacing the physical sticker in most cases. Once stamped, you are a UAE resident: you can open personal bank accounts, sign tenancies, and stay without re-entering on new permits. The whole chain typically runs in weeks, not days.
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