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Dubai has become an attractive destination for Turkish investors seeking tax efficiency, commercial flexibility, and international credibility. The city offers a supportive business environment through its free zones, low tax rates, and streamlined incorporation processes. This article outlines the key phases of setting up a company in Dubai, including tax considerations, bank account opening, and the structuring of service contracts with Turkish companies.
Investors can choose from different company types depending on their goals. Free zone companies, such as those established in IFZA, DMCC, or Meydan, allow 100% foreign ownership and often eliminate the need for a local sponsor. These zones are commonly used for consultancy, software, trading, and holding activities. Mainland companies, on the other hand, may be more suitable for those targeting direct business within the UAE. The incorporation process generally takes 1–2 weeks and requires identification documents, business activity details, and a registered office address.
Once the company is formed, the next step is opening a corporate bank account in the UAE. This step often requires more preparation than the incorporation itself. Banks request detailed documentation about the company’s operations, ownership structure, and business model. For service-based businesses, demonstrating actual commercial activity is important. Some banks may require in-person meetings or proof of a physical office, while others accept co-working space leases. If traditional banks prove challenging, fintech solutions offering multi-currency digital accounts can be a useful alternative.
After the company is operational and the bank account is active, attention must shift to the structuring of service agreements, particularly when the Dubai-based entity will be providing services to companies located in Turkey. These contracts are essential for both legal and tax compliance purposes. A properly drafted agreement should outline the nature of the services (e.g., consultancy, management, software development), the pricing model, payment terms, and dispute resolution clauses. If the Dubai company is part of the same group as the Turkish client, compliance with transfer pricing rules becomes particularly important. For payments to be accepted and traceable, the contract should reflect a genuine commercial transaction supported by deliverables, invoices, and reporting. Turkish tax authorities may scrutinize such transactions if they are not properly documented or priced at arm’s length. Therefore, legal review of the service contracts is strongly recommended to ensure compliance with both Turkish and UAE tax regulations.
In conclusion, establishing a company in Dubai can offer Turkish investors multiple strategic advantages. However, to fully benefit from the structure, it is essential to plan each step carefully—from choosing the right free zone to ensuring the proper legal framework for invoicing and payment. Working with legal advisors familiar with both jurisdictions can significantly reduce risks and help ensure long-term success.
At SKA Law, we provide legal support to Turkish investors seeking to establish a presence in Dubai. We assist clients in selecting the most suitable free zone or mainland structure based on their intended business activity, and manage the full incorporation process from start to finish. Our services also cover all related steps, including bank account opening, drafting compliant service agreements, and ensuring proper documentation for cross-border transactions. With a clear and practical approach, we help investors navigate the regulatory landscape and set up their operations with confidence.
Investors can choose from different company types depending on their goals. Free zone companies, such as those established in IFZA, DMCC, or Meydan, allow 100% foreign ownership and often eliminate the need for a local sponsor. These zones are commonly used for consultancy, software, trading, and holding activities. Mainland companies, on the other hand, may be more suitable for those targeting direct business within the UAE. The incorporation process generally takes 1–2 weeks and requires identification documents, business activity details, and a registered office address.
Once the company is formed, the next step is opening a corporate bank account in the UAE. This step often requires more preparation than the incorporation itself. Banks request detailed documentation about the company’s operations, ownership structure, and business model. For service-based businesses, demonstrating actual commercial activity is important. Some banks may require in-person meetings or proof of a physical office, while others accept co-working space leases. If traditional banks prove challenging, fintech solutions offering multi-currency digital accounts can be a useful alternative.
After the company is operational and the bank account is active, attention must shift to the structuring of service agreements, particularly when the Dubai-based entity will be providing services to companies located in Turkey. These contracts are essential for both legal and tax compliance purposes. A properly drafted agreement should outline the nature of the services (e.g., consultancy, management, software development), the pricing model, payment terms, and dispute resolution clauses. If the Dubai company is part of the same group as the Turkish client, compliance with transfer pricing rules becomes particularly important. For payments to be accepted and traceable, the contract should reflect a genuine commercial transaction supported by deliverables, invoices, and reporting. Turkish tax authorities may scrutinize such transactions if they are not properly documented or priced at arm’s length. Therefore, legal review of the service contracts is strongly recommended to ensure compliance with both Turkish and UAE tax regulations.
In conclusion, establishing a company in Dubai can offer Turkish investors multiple strategic advantages. However, to fully benefit from the structure, it is essential to plan each step carefully—from choosing the right free zone to ensuring the proper legal framework for invoicing and payment. Working with legal advisors familiar with both jurisdictions can significantly reduce risks and help ensure long-term success.
At SKA Law, we provide legal support to Turkish investors seeking to establish a presence in Dubai. We assist clients in selecting the most suitable free zone or mainland structure based on their intended business activity, and manage the full incorporation process from start to finish. Our services also cover all related steps, including bank account opening, drafting compliant service agreements, and ensuring proper documentation for cross-border transactions. With a clear and practical approach, we help investors navigate the regulatory landscape and set up their operations with confidence.
