One Person Company Dubai 2025: OPC Setup Guide & Benefits

Can you form a limited liability company with just one shareholder in Dubai? Yes! The One Person Company (OPC) structure, introduced under UAE Companies Law 2021, allows solo entrepreneurs to establish a limited liability company with 100% single ownershipcombining the liability protection of an LLC with the simplicity of sole proprietorship. This game-changing structure has enabled over 15,000 solo entrepreneurs to formalize their businesses in Dubai since 2021.

As Ministry-approved business consultants with 37 years of Dubai experience (having formed over 3,500 OPCs since 2021), we've helped solo entrepreneurs navigate the OPC structure's unique benefits and requirements. This comprehensive guide explains everything you need to know: OPC vs other structures, setup process, costs, benefits, limitations, and whether OPC is right for your solo business.

What is a One Person Company (OPC)?

Legal Definition

A One Person Company (OPC) is a limited liability company owned by a single natural person (individual), recognized under UAE Federal Decree-Law No. 32 of 2021 on Commercial Companies.

Key Characteristics:

Single shareholder (100% ownership)
Limited liability protection (personal assets protected)
Corporate legal entity (separate from owner)
Can hire employees
Can sponsor visas
Suitable for commercial, professional, industrial activities

Dubai Context: Before 2021, solo entrepreneurs needed either a partner (51% UAE national for mainland) or form in a free zone. OPC changed this, enabling 100% foreign-owned single-shareholder mainland companies.

OPC vs Other Business Structures

OPC vs Sole Proprietorship

Sole Proprietorship (Sole Establishment):

Owner has unlimited liability (personal assets at risk)
Must be UAE national OR requires UAE sponsor
Lower initial costs (AED 15,000-25,000)
Simpler compliance
Limited growth potential
Not suitable for foreigners (requires sponsor)

One Person Company (OPC):

Owner has limited liability (only capital at risk)
Can be 100% foreign-owned
Higher costs (AED 25,000-40,000 setup)
Corporate compliance requirements
Unlimited growth potential
Can convert to multi-shareholder LLC later
Ideal for foreigners

Key Difference: Limited liability protection. If OPC faces debts or lawsuits, your personal house, car, savings are protected (only company capital at risk).

OPC vs Limited Liability Company (LLC)

Traditional LLC:

Requires 2-50 shareholders minimum (pre-2021)
Now allows single shareholder (essentially same as OPC)
Shared ownership and decision-making
More complex shareholder agreements

One Person Company (OPC):

Single shareholder only
Full control (no partner disputes)
Simpler governance
Easier decision-making

Practical Reality: Under current UAE law, OPC and single-shareholder LLC are functionally identical. "OPC" is the preferred term for clarity, but legally both are LLCs with one shareholder.

OPC vs Free Zone Establishment (FZE)

Free Zone Establishment (FZE):

Single shareholder (similar to OPC)
Limited to free zone premises
Cannot trade directly with UAE mainland
Lower costs (AED 20,000-40,000)
0% corporate tax (if qualifying)
Simpler setup process

Mainland OPC:

Single shareholder
Can trade anywhere in UAE + internationally
Higher costs (AED 30,000-50,000+)
Subject to 9% corporate tax (after AED 375K profit)
More complex setup (DED, Ejari, etc.)

Decision Factor: If you need UAE mainland market access, choose mainland OPC. If primarily exporting/international, choose FZE.

Who Should Form an OPC?

** Ideal for:**

Solo consultants (management, IT, financial consulting)
Professional service providers (accountants, lawyers, architects)
E-commerce entrepreneurs (selling online, dropshipping)
Content creators/influencers (monetizing digital content)
Small-scale traders (import/export businesses)
Service businesses (marketing agencies, design studios)
Technology freelancers (software developers, designers)

** Not suitable for:**

Businesses requiring UAE national partner (strategic sectors)
Those wanting to share ownership with partners (use multi-shareholder LLC)
Purely international businesses with no UAE presence (consider offshore)
Businesses expecting rapid multi-shareholder expansion (start as LLC)

Benefits of One Person Company Structure

1. Limited Liability Protection

The Primary Advantage

What it means:

Company debts ≠ personal debts
Creditors cannot seize personal assets
Liability limited to capital invested in company
Legal disputes against company, not you personally

Example:

OPC owes supplier AED 500,000
Company only has AED 100,000 capital
Supplier can claim company's AED 100,000
Cannot claim your personal villa, car, savings

Compare to Sole Proprietorship:

Unlimited liability
Creditor can seize personal assets
No separation between business and personal

Dubai Context: With UAE's strong creditor rights, limited liability is crucial. We've seen cases where sole proprietors lost personal property due to business debtsOPC structure prevents this.

2. 100% Ownership & Control

No partner disputes, no profit sharing

Benefits:

All profits belong to you
No partner disagreements on strategy
Complete control over business decisions
Easy decision-making (no shareholder meetings required)
No need to consult partners on expenditures

vs Traditional LLC:

Must coordinate with partners
Shareholder meetings for major decisions
Profit distribution per shareholding agreement
Potential disputes on business direction

3. Foreign Ownership Permitted

Since June 2021: 100% foreign ownership allowed

For Foreign Entrepreneurs:

No UAE national sponsor required
No local partner taking 51% ownership
Complete ownership rights
Full profit repatriation
Direct bank account control

Pre-2021 Scenario:

Required 51% UAE national partner (mainland)
"Silent partner" arrangements (risky)
Free zones only option for 100% ownership

Impact: This change unlocked mainland business for thousands of foreign solo entrepreneurs previously forced into free zones.

4. Corporate Credibility

OPC provides corporate legitimacy vs sole trader

Perception Benefits:

Trading as "ABC Consultancy LLC" vs "Ahmed Trading"
Corporate bank account (not personal)
Professional invoicing
Better client confidence
Easier to win contracts (especially government/large corporate)

Banking:

Corporate bank accounts offer better services
Higher transaction limits
Multi-currency accounts
Payment gateways easier to obtain
Business credit cards

Government Contracts:

Many UAE government tenders require corporate entities
Sole proprietorships often excluded
OPC qualifies for most tenders

5. Scalability & Growth

Start solo, expand later

Growth Path:

Year 1: Solo entrepreneur operating OPC
Year 2-3: Hire employees (OPC can sponsor staff)
Year 4+: Convert to multi-shareholder LLC (add partners/investors)

Employee Sponsorship:

OPC can hire employees
Sponsor work visas
Build team as business grows

Conversion to LLC:

When ready to add partners/investors
Simple amendment process (AED 3,000-5,000)
Add shareholders without forming new company

vs Sole Proprietorship:

Cannot have partners/shareholders
Limited visa quota
Difficult to scale

6. Separate Legal Entity

Company exists independently of owner

Legal Benefits:

Contracts in company name (not personal)
Company can sue/be sued (separate from you)
Business continuity beyond owner
Estate planning: OPC shares transferable to heirs

Succession Planning:

OPC shares pass to heirs upon death
Company continues operating
Vs sole proprietorship: Business ends when owner dies

Compliance:

Corporate financial statements
Corporate tax filing
Professional appearance

7. Tax Efficiency

Potential tax benefits vs sole proprietorship

Corporate Tax (9%):

OPC: First AED 375,000 profit at 0%, then 9%
Sole Proprietorship: Same rates apply

Expense Deductibility:

OPC: Can deduct business expenses (rent, salaries, travel)
Clearer separation of business vs personal expenses
Better audit trail

Dividend vs Salary:

OPC owner can take salary (tax-deductible expense)
Or take dividends (0% personal income tax in UAE)
Flexibility in profit extraction

Professional Accounting:

OPC requires audited accounts (mainland)
Better financial management
Clearer tax compliance

Requirements for OPC Formation

1. Shareholder Requirements

Must be Natural Person (Individual)

** Eligible:**

UAE nationals
GCC nationals
Foreign individuals (any nationality)
Individuals aged 21+ years

** Not Eligible:**

Corporate entities (companies cannot own OPC)
Government entities
Partnerships
Trusts

Critical: Only one individual can own OPC. Cannot have company as shareholder.

2. Minimum Capital Requirements

Depends on Activity

Most Commercial/Professional Activities:

No minimum capital required
Declare any amount in MOA (can be AED 1,000)
No requirement to deposit capital

Professional Services (Some):

Legal firms: AED 300,000 minimum
Accounting firms: AED 300,000 minimum
Auditing firms: AED 500,000 minimum

Financial Services:

Banking: AED 10 million+ (CBUAE regulated)
Investment advisory: AED 1 million+
Insurance: AED 5 million+

Dubai Context: >90% of OPCs have no minimum capital requirement. Only specific regulated professions require minimum capital.

3. Manager Appointment

OPC must have appointed Manager

Manager can be:

The owner (shareholder) themselves
Third-party individual appointed by owner
Must be natural person (individual)

Manager Responsibilities:

Day-to-day business operations
Signing contracts on behalf of company
Banking authority
Legal representative

Typical Structure:

Owner = Manager (most common for solo entrepreneurs)
Simplifies operations
Owner has full control

4. Office Space Requirement

Physical office mandatory

Mainland OPC:

Ejari-registered office space required
Minimum 100-300 sq ft (depending on activity)
Options:
- Dedicated office (AED 25,000-70,000/year)
- Flexi-desk in business center (AED 12,000-25,000/year)
- Home office (limited activities, requires approvals)

Free Zone FZE (Alternative):

Office/flexi-desk provided by free zone
Included in license package
Simpler process

No Virtual Offices:

UAE does not recognize virtual offices for licensing
Must have physical space (even if flexi-desk)

5. Business Activity Selection

Choose from DED-approved activities

Commercial License:

Trading (general or specific goods)
Import/export
E-commerce
Retail (if premises suitable)

Professional License:

Consultancy (management, IT, financial, etc.)
Professional services (accounting, legal, engineering)
Technical services

Industrial License:

Manufacturing
Production
Processing

Restrictions:

Some activities require external approvals
Some activities still require UAE partner (strategic sectors)
Choose all relevant activities during formation (adding later costs AED 3,000-5,000 each)

6. Trade Name Requirements

Unique name required

Naming Rules:

Must include "LLC" or "Limited Liability Company"
Cannot include "OPC" (not officially used in UAE)
Must relate to business activity
Cannot be similar to existing companies
Arabic translation required
Cannot include religious terms or "UAE"/"Dubai" without permission

Examples:

"Summit Consulting LLC"
"Apex Trading LLC"
"Summit OPC" (OPC not used)
"Dubai Excellence LLC" (requires Dubai approval for "Dubai")

OPC Formation Process: Step-by-Step

Timeline: 18-25 Days

Phase 1: Pre-Formation (Days 1-3)

Day 1: Decide Structure & Location

Confirm OPC is right structure (vs FZE, LLC)
Choose mainland or free zone
Identify business activities
Prepare 5 potential trade names

Day 2: Document Preparation

Gather passport copy (color, valid >6 months)
Proof of address (utility bill, bank statement)
Passport photos (white background)
UAE address (if available)

Day 3: Name Reservation

Submit name reservation to DED
Propose 3-5 names ranked by preference
Pay AED 620 fee
Receive approval within 24-48 hours

Phase 2: License Application (Days 4-14)

Days 4-5: Initial Approval

Submit initial approval application
Upload passport, name reservation
Specify business activities
Pay AED 1,000-2,000

Days 6-7: Memorandum of Association (MOA)

Draft MOA (single shareholder)
Include: Company name, address, activities, capital, manager appointment
Notarize MOA at approved notary public
Cost: AED 2,000-4,000

Days 8-9: Office Space

Secure Ejari-registered office or flexi-desk
Sign tenancy agreement
Register Ejari (AED 220)
Obtain landlord NOC

Days 10-12: Complete Application

Submit full application to DED
Upload all documents
DED review (may raise queries)
Respond to queries within 48 hours

Days 13-14: License Issuance

Pay license fees (AED 15,000-30,000)
Receive trade license (digital + physical)
License valid 1 year

Phase 3: Post-License (Days 15-25)

Day 15: Chamber of Commerce

Register with Dubai Chamber
Submit license + passport
Pay AED 1,000-2,500
Receive membership certificate

Days 16-18: Visa Processing

Apply for investor visa (owner)
Medical fitness test (AED 350-500)
Emirates ID application (AED 770)
Cost: AED 5,000-8,000

Days 19-22: Bank Account

Apply for corporate bank account
Submit: License, MOA, Emirates ID, passport, business plan
Bank visit for signatures
Approval: 5-10 days
Initial deposit: AED 5,000-25,000

Days 23-25: Tax Registrations

Corporate tax registration (EmiraTax portal)
VAT registration (if applicable)
Setup accounting system

OPC Setup Costs: Complete Breakdown

Mainland OPC Costs

Government Fees:

Name reservation: AED 620
Initial approval: AED 1,200-2,000
Trade license: AED 15,000-30,000 (depending on activity)
Chamber membership: AED 1,500-2,500
Government Total: AED 18,320-36,120

Legal & Documentation:

MOA drafting & notarization: AED 2,000-4,000
Typing center: AED 500-1,000

Office Space (Annual):

Flexi-desk: AED 12,000-25,000
Small office: AED 25,000-60,000
Ejari registration: AED 220

Visa (Owner):

Medical + Emirates ID + visa: AED 5,000-8,000

Professional Services:

PRO/consultancy: AED 8,000-12,000

TOTAL YEAR 1:

Minimum (flexi-desk): AED 46,000-62,000
Realistic (proper setup): AED 60,000-85,000
Premium (dedicated office): AED 80,000-120,000

YEAR 2+ Recurring:

License renewal: AED 15,000-30,000
Office rent: AED 12,000-60,000
Visa renewal: AED 5,000-7,000
Audit: AED 5,000-12,000
Annual: AED 37,000-109,000

Free Zone FZE Costs (Alternative)

Example: Dubai Silicon Oasis (DSO)

Year 1:

License: AED 15,000-18,000
Flexi-desk: AED 12,000-15,000
Visa: AED 6,000-7,500
Total: AED 33,000-40,500

Savings vs Mainland: ~30-40% cheaper

Trade-off: Cannot trade directly with UAE mainland

OPC vs FZE: Detailed Comparison

Scroll to see all columns →

Factor	Mainland OPC	Free Zone FZE
Ownership	100% single owner	100% single owner
Initial Cost	AED 46,000-85,000	AED 33,000-50,000
Annual Cost	AED 37,000-109,000	AED 24,000-40,000
UAE Market Access	Full access	Limited (needs distributor)
International Trade	Allowed	Allowed
Corporate Tax	9% (>AED 375K profit)	0% (if qualifying)
Setup Complexity	Higher (DED, Ejari, etc.)	Lower (free zone handles)
Visa Quota	Based on office size	Fixed per package
Audit Required	Yes (mainland)	Often not required
Government Contracts	Eligible	Limited eligibility

Decision Guide:

Choose Mainland OPC if: Need UAE market access, government contracts, unlimited flexibility
Choose FZE if: Primarily exporting, want 0% tax, prefer lower costs

Common Mistakes in OPC Formation

Mistake 1: Choosing OPC When Partnership Needed

What happens: Form OPC, then discover business requires multiple stakeholders

Example: Tech startup forms OPC, then seeks investor 6 months later. Must convert to multi-shareholder LLC (AED 3,000-5,000 + delays).

Solution: If you anticipate partners/investors within 12-18 months, form multi-shareholder LLC from the start.

Mistake 2: Insufficient Business Activity Selection

What happens: Select only primary activity, need to add activities later

Cost: AED 3,000-5,000 per activity + 7-14 days delay

Solution: Select all potentially relevant activities during formation (free to add during setup, expensive to add later).

Mistake 3: Wrong Office Size (Visa Quota Issues)

What happens: Rent smallest flexi-desk, discover you need more visas for staff

Example: Flexi-desk allows 1-2 visas. Business grows, need 5 employees. Must upgrade office (AED 15,000-30,000 additional/year).

Solution: Project hiring needs for 18-24 months, size office accordingly.

Mistake 4: Underestimating Compliance Requirements

What happens: Assume OPC is "simple" like sole proprietorship

Reality: OPC requires:

Annual audited financial statements
Corporate tax return filing
Proper accounting (not personal accounts)
Statutory registers

Cost of non-compliance: AED 10,000-50,000 penalties

Solution: Budget for professional accounting (AED 12,000-30,000/year)

Professional OPC Formation Services

We provide end-to-end OPC setup:

Structure Consulting: Confirm OPC is right for your needs Document Preparation: MOA, applications, all paperwork Government Liaison: DED submissions, approvals, follow-ups Office Solutions: Pre-approved flexi-desks and business centers Visa Processing: Complete visa and Emirates ID support Banking Support: Bank introductions and account opening Post-Setup Compliance: Accounting setup, tax registrations

Timeline: 18-22 days (vs 25-35 days DIY)

Cost: AED 8,000-12,000 professional fees

Package Includes: License, flexi-desk, 1 visa, all government fees, PRO services

Call: +971 42 500 251 Email: info@auditfirmsdubai.ae

Frequently Asked Questions

Q: Can a foreigner form OPC in Dubai? Yes, 100%. Since June 2021, foreigners can own 100% of mainland OPC. No UAE sponsor required.

Q: What's the difference between OPC and sole proprietorship? Limited liability. OPC protects personal assets from business debts. Sole proprietorship has unlimited liability (personal assets at risk). Also, sole proprietorship requires UAE sponsor for foreigners; OPC doesn't.

Q: Can OPC have employees? Yes, OPC can hire employees and sponsor work visas (based on office size quota).

Q: Can I convert OPC to multi-shareholder LLC later? Yes, simple amendment process. Add shareholders anytime (AED 3,000-5,000 + license amendment).

Q: Does OPC require annual audit? Mainland OPC: Yes, annual audit required. Free Zone FZE: Many free zones don't require audit (cost saving).

Q: Can OPC do business outside Dubai? Yes, mainland OPC can operate anywhere in UAE and internationally. Free zone FZE can operate internationally but limited mainland UAE access.

Q: What's the minimum cost for OPC setup? Mainland: AED 46,000-62,000 (realistic: AED 60,000-85,000) Free Zone FZE: AED 33,000-40,000

Q: How long does OPC formation take? 18-25 days for straightforward setups. Can extend to 30-40 days if external approvals required or documentation issues.

Your OPC Action Plan

Week 1: Planning

Confirm OPC is right structure for your business
Decide mainland vs free zone
List all business activities
Prepare 5 potential trade names
Budget AED 60,000-85,000 for Year 1

Week 2: Documentation

Gather passport (valid >6 months)
Proof of address
Draft business plan (for banking)

Week 3-4: Formation

Week 5-6: Post-License

Ready to form your One Person Company?