Guide · setting up a company

UAE vs Cyprus: setting up a company

Costs, registration time, destination taxes and yearly duties side by side, from the same official data as the setup cost calculator.

The UAE free zone company and the Cyprus private limited company are two common starting points for a founder abroad. They differ in currency, in what a firm’s price covers, in how profits are taxed and in the paperwork each year brings. A UAE free zone company is priced in dirhams, often as a package with the licence. A Cyprus company is priced in euros, with registry fees paid on top of the firm’s own fee.

This page puts the official facts for both side by side and leaves the choice to you. The right fit turns on where you live, where the company is run from, who its customers are and what it earns. Keep in mind that the country where you live can tax the dividends paid to you, and its rules on controlled foreign companies can also tax the company’s profits in your hands.

At a glance

United Arab EmiratesCyprus
Company typeFree zone company (FZE, FZCO or FZ-LLC)Private limited liability company by shares (Ltd)
Official fees at setupIncluded in firms' packagesEUR 175
Official fees every yearIncluded in firms' packagesEUR 20
Company formation by a firmAED 5,500 to AED 11,000 one-offEUR 1,170 to EUR 1,820 one-off
Accounting and annual accountsAED 5,990 to AED 11,990 per yearEUR 500 to EUR 2,100 per year
Registration timeAbout 1 dayNot published
Minimum share capitalRAKEZ: minimum share capital of an FZ-LLC AED 10,000, higher for some activities; Meydan Free Zone requires no paid-up share capitalNo minimum share capital for a private company
Corporate tax0% up to AED 375,000 of taxable income, 9% above; 0% on qualifying income of a Qualifying Free Zone Person, with conditions15% from 1 January 2026
Tax on dividends to a non-resident individual0% withholding on payments to non-residentsNo Special Defence Contribution for a non-resident individual
VAT5%; registration above AED 375,000 of taxable supplies (the threshold does not apply to foreign businesses)19%; registration above EUR 15,600 of taxable supplies in 12 months

Firms' figures are starting prices published by firms on Accountanty (the lower to the upper quartile with at least 8 firms; "from" with 5 to 7; on request below 5). Tax lines are summaries: the full rules and sources are further down.

Cost to set up and run the company

The calculator's estimate for each company type with its default services: company formation, accounting and the services the law requires.

United Arab Emirates

Setup cost AED 5,500 to 11,000 about EUR 1,340 to 2,670
Every year AED 5,990 to 11,990 about EUR 1,460 to 2,910
Open the calculator for United Arab Emirates

Cyprus

Setup cost EUR 1,350 to 2,000
Every year From EUR 1,140
Open the calculator for Cyprus

Taxes on the destination side

Your country of residence may tax the dividends you receive, and it may also tax the company's profits under its rules on foreign companies controlled by its residents. A company managed from your country may be treated as resident there. This is general information, not tax advice.

United Arab Emirates

Corporate tax

  • Corporate tax 0% on the part of taxable income up to AED 375,000. mof.gov.ae
  • Corporate tax 9% on taxable income above AED 375,000. mof.gov.ae
  • A Qualifying Free Zone Person pays 0% on qualifying income and 9% on other taxable income; it must keep adequate substance in the UAE, earn qualifying income and meet the transfer pricing and audited accounts rules. mof.gov.ae
  • Small Business Relief: a resident company with revenue of AED 3,000,000 or less in the current and each previous tax period may elect to be treated as having no taxable income. mof.gov.ae
  • Small Business Relief applies to tax periods ending on or before 31 December 2029. mof.gov.ae

Tax on dividends paid abroad

  • Withholding tax on UAE-sourced income of non-residents without a permanent establishment is 0%. mof.gov.ae

VAT

  • VAT standard rate 5%. mof.gov.ae
  • VAT registration is mandatory above AED 375,000 and voluntary from AED 187,500 of taxable supplies, imports or expenses in 12 months; the mandatory threshold does not apply to foreign businesses. tax.gov.ae

Example: profit of AED 411,500, all paid out

Standard rates (0% up to AED 375,000, 9% above)
Corporate taxAED 3,285 (0.8%)
Tax withheld on the dividendAED 0
Dividend received, before any tax in your countryAED 408,215

Cyprus

Corporate tax

  • From 1 January 2026 Cyprus companies pay corporate income tax at 15%. gov.cy

Tax on dividends paid abroad

  • Individuals who are not Cyprus tax resident, or not domiciled in Cyprus, are not subject to Special Defence Contribution on dividends. gov.cy
  • Dividends paid to a non-resident company carry Special Defence Contribution only if that company is resident in a jurisdiction on the official lists: 5% or 17% depending on the list. gov.cy

VAT

  • VAT standard rate 19%; reduced rates 9% and 5%; super reduced rate 3%. europa.eu
  • VAT registration when taxable supplies exceed EUR 15,600 in the last 12 months or are expected to in the next 30 days. companies.gov.cy

Example: profit of EUR 100,000, all paid out

Corporate income tax (15%)
Corporate taxEUR 15,000 (15%)
Tax withheld on the dividendEUR 0
Dividend received, before any tax in your countryEUR 85,000

Destination taxes only, before tax treaties and before any tax in your country of residence. Assumption: one shareholder, an individual not resident in the destination, holding 100% of the company; EUR 100,000 converted at the ECB rate. Try your own figure in the calculator.

Registration: steps and time

United Arab Emirates

About 1 day. Meydan Free Zone: standard applications typically completed within 24 hours, depending on the activity and documents.

  1. Determine the nature of the business activity moet.gov.ae
  2. Determine the company's legal structure moet.gov.ae
  3. Register the trade name moet.gov.ae
  4. Select the business space and location moet.gov.ae
  5. Obtain the initial approval moet.gov.ae
  6. Register and pay the fees moet.gov.ae
  7. Register for corporate tax within three months of incorporation tax.gov.ae

Cyprus

Not published. Registration is generally completed within a few days; the Registrar offers an accelerated procedure for an extra fee.

  1. Apply to the Registrar of Companies for approval of the company name companies.gov.cy
  2. A lawyer licensed by the Cyprus Bar Association prepares and signs the memorandum, articles and form HE1 investcyprus.org.cy
  3. File the incorporation through e-filing within six months of the name approval companies.gov.cy
  4. Register with the Tax Department and obtain a tax number within 60 days of incorporation companies.gov.cy
  5. Enter the beneficial owners in the register within 90 days of incorporation companies.gov.cy
  6. Register with the Social Insurance Services when the company becomes an employer companies.gov.cy

Every year after registration

United Arab Emirates

  • Corporate tax return within 9 months from the end of the tax period mof.gov.ae
  • Late corporate tax registration carries an administrative penalty of AED 10,000 mof.gov.ae
  • Records and documents kept for 7 years after the end of the tax period mof.gov.ae
  • Audited financial statements required for a Qualifying Free Zone Person and for revenue over AED 50,000,000 tax.gov.ae
  • Mainland LLC: accounts audited every year by one or more auditors elected by the partners moet.gov.ae
  • RAKEZ: audited financial statements by a RAKEZ approved auditor within six months of the financial year end; late filing fine AED 2,500 rakez.com
  • DMCC: accounts approved by the directors and reported on by a DMCCA approved auditor within six months of the financial year end dmcc.ae
  • RAKEZ: licences are generally valid for one year; late renewal penalty AED 50 per day rakez.com

Cyprus

  • First annual return made up 18 months after incorporation, then yearly, filed within 28 days of its drafting date companies.gov.cy
  • Late annual return: up to EUR 50, plus EUR 1 a day, to a maximum of EUR 150 companies.gov.cy
  • Every private company's financial statements are audited by a statutory auditor cylaw.org
  • A review may replace the audit where turnover and balance sheet stay within EUR 300,000 and EUR 500,000 for two consecutive years cylaw.org
  • From tax year 2026 every Cyprus company files a tax return, whatever its income, by 31 January of the second following year gov.cy
  • Beneficial owner details confirmed each year between 1 October and 31 December companies.gov.cy

Documents and requirements

United Arab Emirates

  • Mainland: a memorandum of association (MOA) or a local service agent agreement (LSA) moet.gov.ae
  • DMCC: articles of association, prepared as part of the registration dmcc.ae
  • Beneficial owner records and the register of partners or shareholders, filed with the registrar within 60 days of licensing dda.gov.ae
  • Foreign investors can fully own mainland companies; activities of strategic impact may face restrictions on foreign ownership u.ae
  • One person may incorporate and own a mainland limited liability company moet.gov.ae
  • In a free zone, an FZE allows a single shareholder and an FZCO allows several shareholders jafza.ae
  • A beneficial owner is a natural person holding 25% or more of the capital or voting rights, directly or indirectly dda.gov.ae
  • Meydan Free Zone: no mandatory requirement to lease a physical office meydanfz.ae

Cyprus

  • Memorandum and articles of association, signed in Greek companies.gov.cy
  • Statutory declaration form HE1, signed and sworn before the court by the lawyer companies.gov.cy
  • By hand or post: form HE2 (registered office address) and form HE3 (first directors and secretary) companies.gov.cy
  • At least one director, aged 18 or over companies.gov.cy
  • One company secretary aged 18 or over; the director may also be secretary only with one member and one director companies.gov.cy
  • A registered office address is filed with the incorporation (form HE2) companies.gov.cy
  • Only lawyers licensed by the Cyprus Bar Association may prepare and sign the memorandum investcyprus.org.cy
  • Firms that provide administrative services to companies need a CySEC licence cysec.gov.cy

What to weigh between UAE and Cyprus

Formation. In the UAE the official free zone packages are listed for reference only: RAKEZ Basic AED 6,000, Meydan AED 12,500 and DMCC AED 35,484. Firms’ packages usually include the licence, so these are not added to the firms’ prices. Meydan states that standard applications are typically completed within 24 hours and asks for no paid-up share capital, while RAKEZ sets AED 10,000 for an FZ-LLC. In Cyprus the name approval costs EUR 10 and the online incorporation EUR 165. There is no minimum share capital, and a lawyer licensed by the Cyprus Bar Association prepares and signs the memorandum.

People and offices. A free zone FZE can have a single shareholder, and an FZCO can have several. Meydan has no rule that you lease a physical office. A Cyprus company needs at least one director aged 18 or over, a company secretary and a registered office address filed at incorporation.

Firms’ prices. On Accountanty, 94 firms publish a formation price for a UAE free zone company, from AED 5,500 to AED 11,000. For Cyprus, 19 firms publish one, from EUR 1,170 to EUR 1,820. Visas, medical tests and Emirates ID are extra in the UAE unless a package says otherwise.

Taxes inside the company. UAE corporate tax is 0% on taxable income up to AED 375,000 and 9% above it. A Qualifying Free Zone Person pays 0% on qualifying income only if it meets the substance, income, transfer pricing and audit conditions, so the calculator does not compute that rate. Small Business Relief lets a resident company with revenue of AED 3,000,000 or less elect to have no taxable income, for tax periods ending on or before 31 December 2029. Cyprus charges 15% from 1 January 2026. A dividend paid to a non-resident individual carries no withholding tax in either country in the cases shown.

Every year. A UAE company files its corporate tax return within 9 months of the end of the tax period and keeps records for 7 years. A Qualifying Free Zone Person needs audited accounts, and RAKEZ and DMCC each ask for them within six months of the year end. In Cyprus the accounts are audited, or reviewed below EUR 300,000 of turnover and EUR 500,000 of balance sheet for two years running, and from tax year 2026 every company files a tax return.

Next steps

United Arab Emirates

Get quotes from firms in the United Arab Emirates

Cyprus

Get quotes from firms in Cyprus

UAE vs Cyprus: questions and answers

How fast can a company be set up in the UAE or in Cyprus?

Meydan Free Zone says standard applications are typically completed within 24 hours, depending on the activity and the documents. Cyprus does not publish a fixed time; registration is generally completed within a few days, and the Registrar offers a faster procedure for an extra fee. Gathering documents and due diligence come first in both.

Do I need a minimum share capital in the UAE or Cyprus?

Cyprus sets no minimum share capital for a private company. In the UAE it depends on the free zone: Meydan requires no paid-up share capital, while RAKEZ sets a minimum of AED 10,000 for an FZ-LLC, higher for some activities. Check the rule of the free zone you pick.

How are company profits taxed in the UAE and in Cyprus?

The UAE charges 0% on taxable income up to AED 375,000 and 9% above it. A Qualifying Free Zone Person pays 0% on qualifying income only when it meets set conditions, and Small Business Relief is available until 2029. Cyprus charges 15% from 1 January 2026. Your own country may also tax dividends and, under its rules, the company's profits.

Why are the UAE free zone fees not added to firms' prices?

Firms' free zone packages usually include the licence. The official packages of RAKEZ, Meydan and DMCC are shown for reference only, so that the same cost is not counted twice. Visas, medical tests and Emirates ID are extra unless a package says otherwise, so ask what a quote covers.

Which is better for my company, the UAE or Cyprus?

This page does not pick one. It depends on your country of residence, where the company is managed, where its customers are and the income it earns. Read the facts side by side, run your own numbers in the calculator for each country, and ask firms in both for a quote and a view on your case.

Sources and notes

  1. meydanfz.ae read 2026-10-23
  2. rakez.com read 2026-10-23
  3. rakez.com read 2026-10-23
  4. meydanfz.ae read 2026-10-23
  5. dmcc.ae read 2026-10-23
  6. u.ae read 2026-10-23
  7. moet.gov.ae read 2026-10-23
  8. dlp.dubai.gov.ae read 2026-10-23
  9. moet.gov.ae read 2026-10-13
  10. tax.gov.ae read 2026-10-23
  11. dda.gov.ae read 2026-10-13
  12. u.ae read 2026-10-13
  13. jafza.ae read 2026-10-13
  14. mof.gov.ae read 2026-10-13
  15. mof.gov.ae read 2026-10-23
  16. mof.gov.ae read 2026-10-13
  17. tax.gov.ae read 2026-10-23
  18. dmcc.ae read 2026-10-23
  19. mof.gov.ae read 2026-10-23
  20. mof.gov.ae read 2026-10-23
  21. mof.gov.ae read 2026-10-23
  22. mof.gov.ae read 2026-10-23
  23. tax.gov.ae read 2026-10-23
  24. investcyprus.org.cy read 2026-10-13
  25. companies.gov.cy read 2026-10-13
  26. companies.gov.cy read 2026-10-13
  27. companies.gov.cy read 2026-10-13
  28. companies.gov.cy read 2026-10-13
  29. companies.gov.cy read 2026-10-13
  30. companies.gov.cy read 2026-10-13
  31. companies.gov.cy read 2026-10-13
  32. cysec.gov.cy read 2026-10-13
  33. companies.gov.cy read 2026-10-23
  34. companies.gov.cy read 2026-10-23
  35. cylaw.org read 2026-10-23
  36. gov.cy read 2026-10-23
  37. gov.cy read 2026-10-23
  38. gov.cy read 2026-10-23
  39. gov.cy read 2026-10-23
  40. europa.eu read 2026-10-23

Official figures checked up to 2026-10-23. General information, not legal or tax advice: check the official sources and confirm costs with a firm before you act.