Dubai attracts international entrepreneurs to set up a business in Dubai because it is an incredible land of opportunities. Pro-active government policies, a business-friendly atmosphere, the cheapest company formation in Dubai, and the lack of corporate tax obligation make establishing a company in Dubai mainland a golden opportunity.
Everyone makes mistakes and it’s fine to make them because we are humans. A significant piece of our life rotates around building ourselves from botches. But we have collected the top 10 mistakes people make while setting up a business in Dubai, so you can take cautious steps for the fortunate beginning.
Errors to avoid while setting up a business in Dubai:
False advice on structures:
Always get the correct advice on the company structure with the help of trusted professionals. The main piece of beginning a business in Dubai is to set up the organizational structure effectively. Else, it can set you back a ton of cash and time. You waste a lot of money and spend more weeks or months rectifying the mistake. Such mistakes delay the opening of the company and hence the expected profits. So we recommend you get advice from someone qualified and had years of experience in the field.
Getting access to the Wrong License:
Please make sure that you are always getting a license from the appropriate free zone or mainland authority. You are the only person who knows your business well and so deeply research on choosing the right legal structure and right license. Stay away from the basic slip-up of picking some unacceptable permit and lawful design. Also, make sure to match the entrepreneur’s activity on the license to the real planning of the business.
Not Recognizing the Value of Money:
With so many different business models to choose from, it can be quite difficult to figure out which one is best for you. There are more than 50 free zones to choose from, with over 2500 business activities open to onshore companies. But, consistently recall that the most financially savvy elective isn’t really the most ideal alternative. An appreciative company structure that maximizes your profit potential now and in the future is the best value you can find.
Neglecting to Renew trade License in Time:
The business should automatically stop when the DED license expires. Entrepreneurs must apply for license renewal to continue operating their businesses. In that way, they can escape the troubles of fine. Failure to renew a trade license on time results in a penalty of AED 250 per month. Engaging in commercial operation on an expired license results in a fine of AED 5,000. To prevent any issues with trade license renewal, seek the advice of the best business setup consultants in Dubai.
We recommend you, entrepreneurs, respect and follow the laws. The DED is against any action of business at an unregistered location. If so, you will pay a penalty of AED 1,000. The location is important while selecting and at most care should give while choosing one. Always engage yourself in an area in which business activity permits under the trade license.
Changing or Adding Business Activity without Approval:
When you are starting a business in Dubai, learn and put in place the exact business activity. DED is generous in allowing more than 2000 activities. Entrepreneurs can choose whatever they desire and the best that dits their business. The companies are also permitted to make changes in the trade license for their business activities with permission. Besides, amending business activity without any permission is a punishable crime with a penalty of AED 2,000 in Dubai.
A company that lacks credibility:
Banks refuse to provide banking facilities if they lack credibility. They refuse to open corporate banks for businesses based in specific jurisdictions. It becomes worthless if a newly formed corporation is unable to open banking accounts. Before you commit to something, double-check that you will have the right banking options for your business.
Inadequate Planning for Worst-Case Scenarios:
Anything can happen at any time, this goes the same with your business but” Prevention is better than cure”. Prepare yourself with knowledge on rules and regulations, required documents, etc for the worst situation. Plan the future of your business and prepare for any obstacles to come. For example, equip yourself with required insurance, well-documented legal contract, etc. The entrepreneurs should invest time and energy and adequate resources to locate troubles and solutions for worst-case scenarios.
Register intellectual property:
Intellectual property/ IP is a very essential component of a new company for its branding and marketing goals. It will aid the owner of the company in potential economic benefits. Intellectual property rights protect the companies properties.
Websites, company logos, colors, and fonts that encompass the marketing and branding materials protect from copying and reuse without permission.
Keep up to date with Recent and Changing Regulations:
Keep an eye on rules and regulations because they are constantly changing. Like any other country, UAE also updates rules and regulations for a better business system. Understand this law and stick close to them for the benefit of your company. In this way, you can avoid fines, jail time, or worse. So please keep yourself updated with the constant changes.