The UAE has become one of the most trusted global hubs for holding companies, thanks to its tax efficiency, business-friendly laws, and access to international markets. A holding company in UAE allows investors to own shares in subsidiaries, manage assets, and centralize business operations under a single structure.
As 2025 approaches, new updates in corporate tax, economic substance rules, and UBO regulations make it essential for investors to understand how to structure their holding company effectively.
What is a Holding Company in the UAE?
A holding company is a parent entity established primarily to own and manage other companies, assets, or investments. Unlike operating companies, it doesn’t sell goods or provide services directly. Instead, it oversees subsidiaries, ensuring financial stability and long-term growth.
In the UAE, holding companies play a major role in asset protection, tax optimization, and centralized management. Investors can register a holding company as a mainland, free zone, or offshore entity, each offering distinct benefits in ownership, taxation, and governance.
1. Holding Company vs Operating Company
- Holding Company: Owns shares and assets, focuses on control and strategic decisions.
- Operating Company: Actively manages daily business operations, hires staff, and generates revenue.
2. Common Purposes of Holding Companies
- Safeguard assets and intellectual property.
- Simplify management across multiple entities.
- Facilitate international expansion and investment diversification.
Why Set Up a Holding Company in UAE in 2025?
The UAE continues to be a magnet for investors seeking flexible business ownership, low taxation, and a stable regulatory system.
- Full Foreign Ownership: Most free zones and mainland jurisdictions now allow 100% foreign ownership.
- Tax Benefits: The UAE’s 9% corporate tax applies only under specific conditions, and there are over 130 double taxation treaties in place.
- Business Stability: Strong banking systems and easy repatriation of profits.
- Strategic Location: The UAE offers access to Asian, European, and African markets.
In 2025, compliance with economic substance rules and UBO reporting will be more crucial than ever, ensuring transparency while maintaining investor protection.
Types of Holding Companies in UAE
Holding companies in the UAE can be structured under three main jurisdictions: Mainland, Free Zone, and Offshore, each tailored to different investor goals.
1. Mainland Holding Company
Mainland holding companies are regulated by the Department of Economic Development (DED). They can hold shares in local or foreign subsidiaries and own real estate in the UAE.
Ideal for: Investors managing local assets or companies operating across multiple emirates.
2. Free Zone Holding Company
A free zone holding company provides 100% ownership, zero import/export tax, and no currency restrictions.
Best free zones for 2025:
- DMCC: Best for global trading groups.
- Meydan Free Zone: Offers fast licensing and low cost.
- IFZA: Ideal for flexible business categories.
- RAKEZ: Budget-friendly with easy bank account setup.
3. Offshore Holding Company
An offshore holding company (like those in JAFZA Offshore or RAK ICC) is suitable for investors who wish to manage international assets, intellectual property, or global investments from the UAE. It has minimal costs but limited local operation rights.
Step-by-Step Process to Set Up a Holding Company in UAE
Establishing a holding company setup in Dubai or any UAE jurisdiction involves clear steps and compliance with legal procedures.
Step 1 – Choose Jurisdiction and Legal Structure
Select between Mainland, Free Zone, or Offshore based on your target markets and tax goals. Free zones suit foreign investors, while mainland companies fit local expansion.
Step 2 – Prepare Required Documents
Documents typically include:
- Passport copies of shareholders and directors
- Proof of address
- Memorandum and Articles of Association
- Business plan (for some free zones)
Step 3 – Apply for the License
Submit your application to the relevant authority, DED for the mainland or the respective Free Zone Authority. After approval, you’ll receive your UAE holding company license UAE.
Step 4 – Open a Corporate Bank Account
Select a UAE-based bank experienced with holding companies. Prepare documents like the trade license, MOA, and shareholder details.
Step 5 – Compliance with Economic Substance Regulations (ESR)
All UAE holding companies must file ESR notifications and UBO reports annually.
- UBO Requirements UAE: Identify all ultimate beneficial owners.
- ESR: Ensure the company maintains sufficient management and control within the UAE.
Cost of Setting Up a Holding Company in UAE 2025
The cost of establishing a holding company in the UAE in 2025 generally ranges between AED 15,000 and AED 50,000, depending on the jurisdiction, license type, and additional business services you choose.
Estimated setup costs by structure:
- Free Zone Holding Company: AED 15,000 – AED 50,000 (approx.)
- Mainland Holding Company: AED 20,000 – AED 50,000 (approx.)
- Offshore Holding Company: AED 10,000 – AED 50,000 (approx.)
These prices exclude visa processing, office space, and bank account opening fees, but they provide a realistic benchmark for your 2025 investment planning. Free zones such as DMCC, IFZA, and RAKEZ continue to offer competitive packages for international investors seeking flexibility and tax advantages.
Taxation and Legal Requirements for Holding Companies
In 2025, corporate tax (9%) will apply to qualifying income exceeding AED 375,000. However, dividends and capital gains from subsidiaries are typically exempt, making holding companies highly tax-efficient.
Legal requirements include:
- Filing annual ESR reports
- Maintaining UBO disclosure
- Complying with AML (Anti-Money Laundering) standards
These measures enhance global credibility and transparency.
Benefits of Establishing a Holding Company in UAE
- Tax Efficiency: Reduced or zero taxation on foreign income and dividends.
- Asset Protection: Safeguard valuable IP and real estate assets.
- Centralized Control: Simplify management across multiple subsidiaries.
- Investment Opportunities: Access to regional and international markets.
- Risk Management: Limit liability to specific entities.
Free Zone vs Mainland Holding Company: Which is Better?
| Feature | Free Zone Holding Company | Mainland Holding Company |
| Ownership | 100% Foreign | 100% Foreign (most cases) |
| Tax | 0% in most zones | 9% Corporate Tax if applicable |
| Market Access | Global | Local + International |
| Cost | Lower | Moderate |
| Control | Complete | Requires local regulation compliance |
For global investors, free zones are typically more cost-effective and flexible, while mainland structures suit those managing UAE-based businesses.
Ripple Business Setup – Your Trusted Partner for Holding Company Formation
Ripple Business Setup provides expert support for entrepreneurs and investors looking to establish holding companies in the UAE. From legal documentation to licensing and ESR compliance, Ripple ensures your business is structured efficiently and compliantly.
Partnering with Ripple means you get:
- Tailored consultation and business strategy
- Fast-tracked licensing and bank account assistance
- End-to-end compliance with UBO and ESR regulations
www.ripplellc.ae | info@ripplellc.ae | +971 4 250 0833
FAQ
1. Can a holding company own real estate in UAE?
Yes. Mainland and certain free zone holding companies can own and manage property assets legally.
2. How long does it take to open a bank account for a holding company?
Usually between 2–4 weeks, depending on the bank and the completeness of documentation.
3. Can a foreigner own a holding company in the UAE?
Yes. Most jurisdictions now allow 100% foreign ownership, especially in free zones.
4. Do holding companies need to pay corporate tax in UAE?
Only if the income exceeds AED 375,000 or falls under the qualifying criteria. Many holding companies remain tax-exempt.
Final Thoughts
Setting up a holding company in UAE in 2025 offers unmatched opportunities for global investors. With a favorable tax regime, asset protection laws, and investor-friendly free zones, the UAE remains a top choice for wealth and business management.
Disclaimer: This article is for informational purposes only and does not constitute legal or financial advice. Readers are encouraged to consult professional advisors or contact Ripple Business Setup for personalized guidance on UAE company formation and compliance.