Setup guide
How to start a software or IT company in the UAE
Software development is normally a professional licence and is one of the least restricted activities in the country — no sector regulator, no premises requirement, and licensable in almost every free zone. Expect AED 15,000–30,000 in year one, or considerably more inside the technology clusters.
What it costs
The cost drivers for this trade.
Software demand is driven by government digitisation, a national target of 90% cashless transactions by 2026, and a fintech sector alone worth around USD 52bn in 2026 heading to USD 90bn by 2031.
Figures on this page
UAE fintech market around USD 52bn in 2026, forecast USD 90bn by 2031 (11.6% CAGR). Digital payments account for roughly 57% of the market; Dubai holds close to 60% share, supported by DIFC and the VARA regime.
Mordor Intelligence, 2026
How the business makes money here
Recurring revenue with high gross margin, front-loaded acquisition cost, and a regional wrinkle: enterprise sales cycles here are relationship-driven and longer than product-led growth assumes. Arabic localisation and data residency are engineering costs that are cheap to build in and expensive to retrofit.
What it costs to start
Published "from" prices compare licence fees and ignore everything that actually moves the total. These are the variables that decide what a software & it business pays in year one.
- Licence category
- Writing and selling your own software is professional; reselling somebody else's is commercial. The distinction affects the code and, on the mainland, the ownership route.
- Cluster premium
- Dubai Internet City costs multiples of a general free zone. You are buying neighbours and their procurement teams, which is either worth it or is not.
- Visa count
- Engineering teams scale headcount fast. Size the premises for year two, not year one.
- IP structuring
- If the code will be owned by a holding entity and licensed to the operating company, that structure costs more to build and more to document.
We quote a single all-in figure with every government fee itemised beside our own, before you commit. Ranges published anywhere — including here — are indicative.
Why here
Regional advantages
Government digitisation is funded
Public sector modernisation pulls private spending behind it and creates genuine budgets.
No personal income tax aids recruitment
Competing for engineering talent is easier when net pay materially exceeds equivalent gross elsewhere.
Almost every zone licenses it
Software is one of the least restricted activities — the jurisdiction decision is about cost, not permission.
And the other side
Regional disadvantages
Small domestic market
Ten million people will not sustain a large software business. Regional expansion is a requirement.
Long enterprise sales cycles
Relationship-driven procurement takes longer than most cash plans assume.
Tax characterisation of software revenue
Royalty versus service treatment affects free zone qualifying income and should be settled at incorporation.
Approvals
Beyond the trade licence.
- Telecom-adjacent services
- TDRA, for anything touching voice, messaging or spectrum — including VoIP.
- Cybersecurity services
- Increasingly subject to federal and emirate-level registration; confirm before quoting government work.
The sequence
How the setup runs.
Confirm the activity and the licence category
Map what you actually do onto the authority's activity schedule and identify any external approval it triggers, before a name is reserved or a fee is paid.
Choose the jurisdiction
Free zone or mainland, decided by who receives your invoices — then narrowed by visa quota, premises need and cost.
Reserve the trade name and obtain initial approval
Three candidate names checked against the register and the naming rules, then initial approval confirming no objection to you owning this business.
Prepare and notarise the incorporation documents
Memorandum of association, shareholder resolutions, attestations where required, and a power of attorney if you are not in the country.
Take the licence, establishment card and immigration file
The company now exists, can contract and can sponsor residence visas.
Complete residence, banking and registrations
Medical and Emirates ID, corporate bank account, corporate tax registration and any VAT, ESR or UBO obligation the structure carries.
Shortlist
Where to license it.
Four worth looking at for this activity, and why each one is on the list. All 12 are in the finder.
Questions
No sector regulator governs general software development. A professional licence naming software development or IT services is sufficient. Telecom-adjacent services touching voice, messaging or spectrum need TDRA approval on top.
Only if it is qualifying income and the company meets the substance tests. Software revenue characterised as royalty or intellectual property income is treated differently from service revenue, so the contract structure matters. Take advice before the first invoice.
Yes — in every free zone, and on the mainland for software and IT activities since the 2021 amendment to the Commercial Companies Law.
One question
Who will be paying your invoices?
Ask the regulator question first. Whether your activity is regulated matters more than where clients sit, because regulated activity needs DFSA, FSRA, Central Bank or SCA authorisation before the jurisdiction question even arises.
Compare the two routesOr just ask usServing UAE retail clients almost always means onshore regulation rather than a free zone licence. The Central Bank and SCA govern that, and a professional licence naming financial consultancy does not substitute.
Compare the two routesOr just ask usFor regulated firms the DIFC or ADGM decision usually settles this before the market question does. Both apply common law with their own regulator, and permissions travel differently from trade licences.
Answer five questions insteadOr just ask us