Feb 18, 2021

Dubai has one of the most famously dynamic economies in the world. As a rapidly modernizing economy, Dubai is in demand of skilled workers who can quickly produce contract work. Freelancing is becoming more common in the Dubai especially with the younger generation. So if you’d like to settle in and live in Dubai for a long time and have marketable skills, there are boundless opportunities to make a decent living in Dubai while you work on your own.

In most circumstances, you must be employed by a UAE company to work from Dubai. However, for certain in-demand industries, the UAE government issues temporary work visas for special, tax-exempt “free zones” within the city. The Government initiatives and various cost-effective freelance permits issued by the various Free zones is supporting the new trend.

The Freelancer License Permit allows many individuals who are keen on working as individuals and not under any company. The Freelancer Permit enables them to have legal support for their job identity and gain credibility among clients. The Freelance Permit is aimed for promoting freelancers to expand their network, gain more acceptance and establish their own companies in Dubai for the future.

What is a free zone?

A free zone is a geographical area that allows foreign workers to establish businesses for a specific business sector, such as design, development, and media. The following are some of free zones.

  • Dubai Media City
  • Dubai Studio City
  • Dubai Production City
  • Dubai Knowledge Park
  • Dubai Design District
  • Dubai International Academic City

How can you become a Licensed Freelancer?

To become a licensed freelancer, you must first register your enterprise as a business and apply for a Trade License that pertains to your business sector from the Department of Economic Development. Aside from the basic Trade License fee, each of Dubai’s 27 free zones has its own registration procedures and fee structure. Some also require an entrepreneur to have a minimum amount of startup capital. One of the most attractive aspects of the Dubai Free Zone model is that all income is tax-exempt for the first 50 years a business is in operation. Additionally, freelancers aren’t required to submit a tax return or keep accounts, and they’re not subject to audits. The government just wants you to focus on building your business and generating deliverables.

What are the top freelancing professions in Dubai?

  • Web development and designing
  • E-learning and Guest Lecturing
  • Copy-writing and guest blogging
  • Sales and Marketing
  • Graphics Designing
  • Mobile App Development
  • Search engine optimization (SEO). Search engine marketing (SEM)
  • Branding
  • Computer-Aided-Design and 3D Modelling
  • Language translation and interpretation
  • Legal services

What are the benefits of freelancing?

  • Flexibility to work anytime from anywhere
  • Gain Self-Sufficiency
  • Work-life Balance
  • Lower the expenses and raise the Profit
  • Option to carry out multiple projects simultaneously
  • Building one’s own Brand
  • No Office Space Required

Do freelancers need to register for VAT?

You might not be aware, but Freelancers are required to register for VAT and follow the VAT rules if your operation is generating any economic consideration.

Advantages of VAT registered for Freelancers

Getting registered for VAT is one of the ways to build your credibility.  It is notable that a VAT Registered freelancer creates a positive market impression by promoting.

  • Stability

An entity can only register for VAT if it reaches a threshold of 375,000AED or at least 187,500AED. This means you are financially stable and can deliver the work without any delay due to lack of funds.

  • Legitimacy

One of the draw backs of hiring a freelancer is the legitimacy of relationship, which may leave a client to hire licensed company instead. A freelancer with VAT registration, in addition to other licenses required by the government, provides access to larger companies.

  • Compliant to the law

As a VAT registered Freelancer means you are abiding by the law, which gives your client an impression that you are trustworthy and will remain a sustainable partner.

What happens if you fail to Register? 

If you reached the mandatory threshold and fail to register for VAT, you will be subject to administrative penalties. Failure or late registration will be subjected to a 20,000AED penalty.

To avoid future issues with the Federal Tax Authority, it is advisable to keep track of your transactions and financial records, register for VAT and be complaint with UAE VAT rules.

 

 

If you need support in financial records and VAT obligations as a freelancer, Beyond Numbers can help you in setting up your financial needs.