🇦🇪 EOR Guide —
United Arab Emirates
Everything you need to know about using an Employer of Record in United Arab Emirates — provider fees, compliance risks, hire speed, and EOR vs direct employment.
Income tax
0% (no personal income tax)
DEWS contribution
5.83% employer (free zone)
Gratuity (mainland)
21 days/yr (first 5 yrs)
Minimum annual leave
30 calendar days
Corporate tax rate
9% (above AED 375,000 profit)
EOR providers active
Deel, Remote, Velocity Global, Oyster
Our Recommendation
EOR well-suited for UAE market entry
The UAE is one of the simplest EOR markets globally. Zero income tax eliminates a major layer of payroll complexity. The main considerations are the DEWS pension scheme for free zone employees and the mainland vs free zone distinction. EOR providers handle both well.
EOR provider fee range for United Arab Emirates
Rates vary by provider, headcount, and benefits scope. Always request itemised quotes from at least three providers.
EOR vs Direct Employment
EOR advantages in United Arab Emirates
- No UAE entity required
- Provider handles DEWS contributions
- Fast onboarding — days
- No income tax simplifies payroll significantly
EOR limitations in United Arab Emirates
- 10–16% markup
- Provider controls employment contract
- Free zone vs mainland status still relevant
Direct employment advantages
- No income tax on employees
- Full operational control
- Free zone entity options available
Direct employment limitations
- Mainland vs free zone entity decision complex
- DEWS pension scheme for free zone employees
- Local sponsor requirement for mainland entities
Local Entity Options
Setting up a legal entity in United Arab Emirates.
If you outgrow EOR or prefer direct employment, these are the main legal structures available in United Arab Emirates for foreign companies.
Free Zone Company (FZCO / FZE)
Setup time
7–21d
Est. cost
$3,000
Min. capital
None
Corp. tax
0%
Div. WHT
0%
VAT rate
5%
Annual obligations
- Annual financial statements (Free Zone Authority)
- Corporate tax return (FTA)
- VAT returns (if registered)
- Trade licence renewal
Overview
40+ Free Zones in the UAE offer 0% corporate tax for qualifying activities, 100% foreign ownership, no customs duties on imports/exports, and full profit repatriation. Key Free Zones: DIFC (financial services), ADGM (financial services), DMCC (commodities), IFZA (general), JAFZA (logistics). Qualifying Free Zone Persons (QFZP) pay 0% tax on qualifying income. Free Zone companies cannot trade directly with UAE mainland (requires distributor or mainland licence).
Mainland LLC (Limited Liability Company)
Setup time
14–30d
Est. cost
$5,000
Min. capital
None
Corp. tax
9%
Div. WHT
0%
VAT rate
5%
Annual obligations
- Annual financial statements (DED)
- Corporate tax return (FTA) — from June 2023
- VAT returns (quarterly)
- Payroll WPS compliance
- Trade licence renewal (annual)
Overview
UAE introduced 9% corporate tax from June 2023 (on profits above AED 375,000). Free Zone companies may be eligible for 0% if they meet qualifying activities and substance requirements. Minimum capital requirements abolished in most emirates. No UAE national shareholder required since 2021 Companies Law reform (FDI law — 100% foreign ownership permitted for most activities). Registered office (Ejari) in UAE required. Trade licence from relevant emirate DED. VAT 5% — registration required if taxable supplies exceed AED 375,000/year.
Branch of Foreign Company
Setup time
3000d+
Est. cost
—
Min. capital
$42
Corp. tax
9%
Div. WHT
0%
VAT rate
5%
Annual obligations
- Annual financial statements (parent)
- UAE corporate tax return (FTA)
- VAT registration (if applicable)
- Trade licence renewal
Overview
Foreign companies can register a branch in the UAE. Ministry of Economy approval required before emirate-level DED registration. Local service agent (UAE national) required for some activities. No separate legal entity — parent fully liable. Branch profits subject to UAE corporate tax (9% if above AED 375,000 threshold). Branch remittances face no UAE withholding tax (0% dividend withholding).
Compliance Risks
Key EOR compliance risks in United Arab Emirates.
Discuss each of these with your chosen provider before signing.
DEWS end-of-service gratuity
MediumEmployees in UAE free zones are covered by DEWS (Daman), a mandatory savings scheme. Employer contributions are 5.83% of monthly salary. Your EOR must enrol eligible employees.
Mainland vs free zone distinction
MediumEmployment law and entity requirements differ between mainland UAE and free zones. Confirm with your EOR which jurisdiction your employees will be employed in.
Visa and work permit management
HighAll expatriate employees require a UAE residence visa and work permit. Processing takes 2–4 weeks. Your EOR will sponsor the visa but you must provide required documents promptly.
End-of-service gratuity (mainland)
MediumMainland employees are entitled to an end-of-service gratuity of 21 days pay per year for the first 5 years, then 30 days per year after.
Cost Estimator
Estimate your United Arab Emirates EOR cost.
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