Working in Dubai as a professional requires you to obtain a trade license or freelance permit. The recent years have seen a rise in the number of freelancers and entrepreneurs in Dubai with its emergence as one of the fastest-growing business hubs in the world. This wave of modernization and globalization of Dubai also sparked the establishment of different business zones – the mainland zone and free zone.
If you are also planning to be a part of this development and globalization phase of Dubai, you must have a trade license or freelance permit. While a trade license is relevant for those business ventures that have a trade-like model with various members in staff, the freelance permit is for the freelancers that work individually.
In the following discussion, we are going to share all the important facts that you must know about the application process of these licenses and what are the various benefits they offer. We are also going to share the other important facts that you must know about both the documents. So, read carefully and make sure you make the right choice for your profession.
What is a freelance permit?
A freelance work permit Dubai identifies you as a freelancer or a self-employed person. So, if you are a sole practitioner that is running the business in his name, then you must apply for this permit. If your business is mainly online that doesn’t require any staff, such as content writing etc, then a freelance work permit is perfect for you.
However, when your earnings reach the taxation limit or you start working with big companies that ask for TRN or Tax Registration Number, you face troubles. This is because TRN is not applicable to the freelancers. Further, the freelancers are not allowed to open a corporate bank account in the UAE.
Why should you go for Freelance Permit in UAE?
Getting a freelance permit in Dubai is relatively easier and requires only a few documents and processes. While the freelance permits might become restrictive if you start earning well and your income becomes taxable, you might require a trade license, until then, the freelance permit works just fine.
Further, the UAE government offers various lucrative packages for freelance work permits. Any freelance work permit costs you anywhere in between AED 10000 and AED 25000. If you wish to work as a freelancer without a freelance work permit in Dubai, you must have a resident visa and a work permit. You must also remember that you have to renew your freelance permit annually, and the cost of this renewal varies across different regions.
Apart from this fee, you require supporting documents for obtaining a freelance work permit in Dubai. Some of the most common ones are mentioned below, while you might also require some additional documents depending on the type of work you are doing.
Supporting Documents required for obtaining a Freelance Work Permit in Dubai:
- The business plan
- Copy of NOC from the current sponsor
- Degree certificate or CV profile (attested as per the standard procedure for international usage)
- Copy of passport
Why not choose a Freelance Permit?
- If you are confused about the scenarios when you should not opt for a freelance permit, take a look at the following reasons for a better understanding.
- You are never ever able to hire any kind of employees as the freelance permit is issued to a person (only you).
- A freelance permit is issued for businesses in only a few domains, namely – media, fashion and education.
- You will not be issued a TRN by the Federal Tax Authority as a freelancer. So, you might never be able to work with big corporate setups.
Now, let us move on to learn how to get a trade license in Dubai and the benefits it offers.
What is a Trade License?
A Trade License allows a business person to carry out various trading activities, hire staff, and obtain various licences and numbers related to taxation and different types of trading. The traders can operate in one or many industries in the UAE and also get involved in major trading activities, such as import and export etc. They don’t have to limit themselves to a few categories, like the freelancers.
If you wish to work as a wholesaler, you must have a general trade license. But, the regulated products, such as beverages, frozen goods, and pharmaceuticals etc require special approvals from the authorities. So, all in all, the ability to operate locally, nationally and internationally is one of the benefits of trade license.
Why should you go for a Trade License in UAE?
A trade license in UAE allows you to operate more freely and doesn’t impede your growth. You can hire employees whenever you need them. You can work with any type of business organizations and large corporations as well. If you are working as a freelancer, once your business grows, you have to deregister yourself as a freelancer and apply for a trade license in Dubai. So, in short, the trade license cuts the trouble short.
A trade license allows you to operate freely across the nation and even internationally. You can enjoy trading within the free zones, mainland zone and with any other business organization.
Trade license increases your credibility as a businessman and you become more trustworthy. This also shows that you have a refined business structure which boosts your case as a vendor when it comes to working with big organizations.
Why not choose Trade License Permit?
If you lack funds, you should not opt for a trade license permit. A trade license comes with a cost of AED 30,000 to AED 40,000 and might come as an added expense. So, if you have limited means, we recommend starting humbly as a freelancer.
The documentation and approval process for some business domains might be lengthy and tiring. This is certainly off-putting and might come as an added pressure. So, approach the application process with the help of some reliable agency for better and swift approval.
How to get a trade license in Dubai?
- Finalize the business domain and name
- Outline the business activities (10 activities are allowed on one license)
- Submit the applications, remit the fee, and complete the additional tasks such as attestations
- Specify a business location and get a contract for the lease
- Finally, submit the application to DED, or the Department of Economic Development (DED)
- Remit the various fees and obtain the trade license
Wrapping-it-up!
If you are planning to launch a big setup with various employees and more functionality, opting for a trade license is a better option. However, if you lack proper vision, funds and are still unclear of the kind of workforce you require, a freelance work permit suits you better.
We hope the discussion proves helpful for all our readers. For more guidance and expert suggestions, please contact Kiltons .
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