United Arab Emirates or Cyprus: where should you start a business?
The United Arab Emirates ranks higher in the index, 01 against 11. Which suits you depends on where the owners live, what the company is for and how it will be run.
Pillar by pillar
Doing business, side by side
Tax
Profits up to AED 375,000 are taxed at 0%. In a free zone the 0% rate reaches qualifying income only, and VAT is charged at 5%.
Corporate income tax rose from 12.5% to 15% on 1 January 2026. VAT is 19%, and deemed dividend distribution no longer applies to profits after 2025.
Set-up
Set-up typically costs AED 10,000 to 50,000 in total, depending on mainland or free zone, the activity and any licences. Capital must be fully paid at incorporation.
Online registration costs €165 and name approval €10, with a lawyer signing the application. The annual return costs €20, and no minimum capital applies.
On the ground
A mainland company needs no resident director or secretary, but it must appoint an auditor. Free zone requirements vary from one zone to another.
A company needs a registered office in Cyprus, which cannot be a mailbox, at least one director and a company secretary.
Ownership
The beneficial ownership register is open to the authorities only. Each company must name a UAE-resident individual as the contact for its register.
Public access to the beneficial ownership register was suspended on 28 November 2022. Companies must confirm their beneficial owners each year.
Residence
An investor or partner can hold a five-year green residence visa on the trade licence. A ten-year golden visa needs capital or a partner's share of AED 2 million.
A foreign-owned company whose beneficial owner invests €200,000 can register with the Business Facilitation Unit, giving its staff access to permits.
Living and working
Currency
UAE dirham, pegged to the US dollar.
Euro.
Time zone
UTC+4.
UTC+2, or UTC+3 in summer.
Personal tax
The UAE does not levy income tax on individuals.
Top rate 35% on income of €72,001 and above from 2026. A 20% capital gains tax applies only to Cyprus property; no inheritance tax.
Flights
Dubai International served 217 destinations in 99 countries at the end of H1 2026; London is 6 hrs 50 mins by British Airways.
Larnaka and Pafos airports served 165 destinations in 42 countries in August 2026; Larnaka handled 9.91 million passengers in 2025.
Language
Arabic is the official language; English is allowed in some Dubai Courts circuits, and the DIFC Courts sit in English.
Greek and Turkish are the official languages and are used in the courts. Most people speak another language, usually English.
United Arab Emirates vs Cyprus: common questions
The United Arab Emirates: Profits up to AED 375,000 are taxed at 0%. In a free zone the 0% rate reaches qualifying income only, and VAT is charged at 5%. Cyprus: Corporate income tax rose from 12.5% to 15% on 1 January 2026. VAT is 19%, and deemed dividend distribution no longer applies to profits after 2025.
The United Arab Emirates: Set-up typically costs AED 10,000 to 50,000 in total, depending on mainland or free zone, the activity and any licences. Capital must be fully paid at incorporation. Cyprus: Online registration costs €165 and name approval €10, with a lawyer signing the application. The annual return costs €20, and no minimum capital applies.
The United Arab Emirates: A mainland company needs no resident director or secretary, but it must appoint an auditor. Free zone requirements vary from one zone to another. Cyprus: A company needs a registered office in Cyprus, which cannot be a mailbox, at least one director and a company secretary.
The United Arab Emirates: The beneficial ownership register is open to the authorities only. Each company must name a UAE-resident individual as the contact for its register. Cyprus: Public access to the beneficial ownership register was suspended on 28 November 2022. Companies must confirm their beneficial owners each year.
The United Arab Emirates: An investor or partner can hold a five-year green residence visa on the trade licence. A ten-year golden visa needs capital or a partner's share of AED 2 million. Cyprus: A foreign-owned company whose beneficial owner invests €200,000 can register with the Business Facilitation Unit, giving its staff access to permits.
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