Biggest Challenges Of Setting New Business in UAE

The UAE is known for its beautiful business environment, its legal framework, government support for companies, a fair tax system, and much more.

Entrepreneurs and startups in UAE face several challenges due to dynamic and fast-moving business scenarios.

Biggest Challenges of Business setup in UAE

Creating something of your own is both a gift and a chance to achieve a work-life balance as you pursue your passions. But it's not that easy.

• Finding Office Space
  An organization established in the UAE is always a combination of licenses, legal entities, and institutions. The UAE is a property driven economy, and it is a legal requirement that a company license stuck to physical office space.
  
  Many free zones offer flexible desks or business center solutions to provide businesses with affordable office space options. Minimum office space requirements vary across countries, and the amount of office space is related to visa quotas/allowances for companies.

• Language Issue
  Arabic is the official language, but English is only in business meetings and transactions in the UAE. All employment documents, including contracts and other documents, such as B. Instructions for employees, must be in Arabic. It is the primary language if there are inconsistencies in terms used in the English document.
  
  
• Get Local Sponsor
  For continental company ownership, foreigners must work with nationals. The majority share goes to local sponsors. Developing trust, reliability, and connections with local sponsors and growing the company is quite a challenges.
  
  The UAE free zone highly encourages foreign investment due to its 100% foreign ownership, tax-free policy, and many other advantages for investors.However, Freezone companies have fixed visa quotas and small office space compared to the mainland.

• Understand UAE Culture
  The UAE has different business rules in other emirates. Business permits, visa requirements, regional marketing specifications, etc.
  
  Therefore, beginners and entrepreneurs alike need to be aware of changing regulations, legal and administrative guidelines.
  
  Expert business consultants like Aurion will provide you with basic UAE business practices and the best place to build your business most conveniently based on your business activity, requirements, and budget.
  
  
• Get Work Permit and Visa
  UAE is a relatively young country with a diverse population. All foreign workers need a work permit or residence permit to live and work in the UAE. Therefore, it is essential to take care that you comply with all Directorate General of Housing and Foreign Affairs regulations and the Ministry of Human Resources and the Emirates.
  
  
• Implication of Tax
  
  The 5% VAT rate has a significant impact on small and medium businesses and startups. All transactions in the UAE, as well as other GCC countries, are subject to VAT.
  
  They affect VAT. Therefore, when planning your business, be sure to check the VAT refund data to avoid penalties.

• Time Planning
  Some business support services in the UAE are estimated to take longer than expected to open a bank account. So you need to plan for delays in advance and make sure your business isn't affected by this order.
  
  
• Planning of Expenses
  Carefully calculate your costs before starting your dream business. There are many cost components to starting your business, from licensing fees, hiring and paying employees.
  
  Cost planning is essential for the UAE business case. Businesses in the UAE are bound to spend a fortune on office space, interior decoration, stationery, administrative tasks, IT software, marketing, and more.
  
  
• Project Funding
  Financing is a significant challenge for beginners. Today very few venture capitalists and incubators support businesses here. Funding a bank in UAE is a tedious process.
  
  Banks are particular when it comes to issuing business loans. Startups are required to provide documents showing their source of income and the growing amount of bank deposits
  
  The UAE market is networked, comprehensive, and dynamic. Therefore, despite these challenges, needs are beneficial.

Conclusion
Financing is a significant challenge for beginners. Today very few venture capitalists and incubators support businesses here. Funding a bank in UAE is a tedious process.

Finding a local sponsor, managing your finances, and getting a clear picture of the rules and regulations can be daunting. And often, the business needs you to encounter can be misleading and incomplete.

Banks are particular when it comes to issuing business loans. Startups are required to provide documents showing their source of income and the growing amount of bank deposits.

The UAE market is networked, comprehensive, and dynamic. Therefore, despite these challenges, needs are beneficial.