Sharjah stands as the UAE’s third-largest emirate since it possesses a robust economy with provisions that are beneficial for business operations. Therefore, entrepreneurs and businesses frequently select LLC companies in Sharjah for their operations in the region. However, before creating an LLC in Sharjah, you must follow several mandatory steps. So, in this guide, we’ll discuss a step-by-step guide on LLC company formation in Sharjah to help you get the knowledge essential for incorporating your company.
What is a Limited Liability Company Structure in the UAE?
The Limited Liability Company (LLC) stands as one of the most popular legal business entities in the United Arab Emirates, and it is especially designed to benefit foreign investors. A minimum of two and a maximum of 50 members establish LLCs in the UAE, where foreign ownership of specific sectors might reach 100%. Entrepreneurs choose LLCs because they provide an ideal foundation for business entry into the UAE market.
Benefits of LLC Company Formation in Sharjah
The city of Sharjah presents perfect conditions for establishing an LLC company formation through various advantages:
- Limited Personal Liability: An LLC’s main benefit lies in its shielding mechanism, which protects members’ assets from judicial proceedings. The members of LLC maintain protection over their private assets, so they face financial responsibility only up to their investment level in the business. The protection system gives businesses financial security as well as an opportunity to conduct high-risk investments.
- 100% Company Ownership: Economic control stands as an important advantage for foreign investors since they now possess the ability to hold 100% ownership of commercial and industrial LLCs based on a new Sharjah policy. The government of Sharjah gives foreign companies unrestricted authority to make and manage their business operations throughout the emirate.
- Flexible Management Structure: An LLC provides members with multiple options to create their management framework. Members have the freedom to select an organisational leadership approach which fits their operational requirements. The adaptable structure of LLC helps organisations create customised strategies for leadership, which in turn allows businesses to work together more effectively while making their decisions efficiently.
- Tax Advantages: An LLC in the UAE benefits from profitable tax policies as part of its establishment. The UAE requires LLC business owners to pay corporate tax only after their net profits rise above AED 375,000*. The competitive corporate tax rate amounts to 9% despite reaching the tax threshold.
- Competitive Taxation: Sharjah stands out among UAE regions because of its advantageous tax regulations. The favourable tax regulation environment of Sharjah makes it an attractive spot that reduces corporate tax expenses for businesses operating there.
- Strategic Location: The advantageous positioning of Sharjah makes it an excellent strategic location. Businesses can access widespread logistical resources along with customers and suppliers through Dubai International Airport and the Jebel Ali Free Zone, which are accessible through the strategic positioning of Sharjah.
- Supportive Government: The Sharjah government exists as a supportive entity which develops business-friendly conditions for the local industry. The emirate provides different programs and incentives that aim to boost the development and achievement of businesses within its borders.
- Affordable Costs: Running an LLC in Sharjah proves more affordable than starting a business within other emirates, particularly Dubai. A favourable business climate arises from reduced office and personnel expenses, along with other operational costs.
Documents Required for LLC Formation in Sharjah
Below, we’ve mentioned the documents required for LLC formation in Sharjah:
- Copies of valid passports and visas for all shareholders and directors of the company are required. This documentation proves shareholders’ residence status through legal verification procedures.
- Every person with ownership in the LLC is required to submit their passport documentation.
- A certified copy of the lease agreement shows that your company occupies office space in Sharjah to establish physical presence in the emirate.
- The license form, together with a completed trade license application, stands as a mandatory requirement. You can obtain this form at the Sharjah Department of Economic Development (SEDD).
- A company bank account statement can be required for certain situations when establishing operations in Sharjah. The statement provides evidence of an organisation’s financial standing.
- Your business requires legal approval components, as your business activity demands particular licenses from various government departments that operate in Sharjah. The documents needed for each government approval depend on your specific industrial sector.
- The trade name certificate enables faster registration since it provides advanced confirmation of your business name. Moreover, this certificate proves your business name is available for selection.
Step-by-Step Procedure to Form an LLC in Sharjah
The procedure for LLC Company formation in Sharjah is as follows:
Step 1: Select a Distinct Business Name
Find a specific business name that matches your brand character and your business operations. Business names for your enterprise can be verified through the registration system of the Sharjah Department of Economic Development (SEDD).
Step 2: Choose a Business Location
When establishing your company, it becomes crucial to choose between operating in the Mainland area or a Freezone because this decision affects both setup procedures and business operational aspects.
Companies established as Mainland entities function freely in every area of Sharjah and the United Arab Emirates. A business setup through the Mainland requires a sophisticated and costly setup procedure while providing higher operational flexibility.
On the other hand, business entities located within Sharjah free zones benefit from tax-free status, along with complete foreign business control (for particular sectors), and simplified operating procedures. Moreover, the business territory of free zone companies is limited to their designated free zone operational area. The popular free trade zones in Sharjah include Sharjah Airport International Free Zone (SAIF Zone), Hamriyah Free Zone and Sharjah Media City (SHAMS).
Step 3: Business Registration and Obtaining a Trade License
Submit the application form and attachments of required documents to the Sharjah Department of Economic Development (SEDD). Your submitted application undergoes evaluation by the SEDD at the free zone. Your Sharjah LLC receives its trade license after approval, which marks official business registration within the region. Moreover, your business activity will determine whether or not you need extra approvals or licenses, which must come from appropriate governmental departments.
Step 4: Open a Corporate Bank Account
You should choose a reliable bank to establish a corporate banking account in the UAE to set up your LLC operations.
Step 5: Select Physical Office Space
Select office premises for setting up a business while following the official rules and necessary criteria that govern your chosen business activity. The owner converses with the landlord to finalise a lease document, which contains all corresponding terms and conditions.
Step 6: Visa and Employee Registration
Operating a business through your LLC makes it possible for your employees to obtain residency visas. However, your business must adhere to all UAE labour laws in all its employee sponsorship and hiring activities.
Cost of Setting up an LLC company in Sharjah
The cost of an LLC license in Sharjah relies on three different business elements: business type, company size and location type, which can be either within the mainland or a free zone. A basic business trade license in Sharjah normally starts at AED 14,900* for general business operations. There are additional expense categories which include:
- Business name reservation fee
- Bank account opening fee
- Legal fees
- Other expenses (e.g., office space rental, visa fees, etc.)
Final Words
LLC company formation in Sharjah provides foreign investors with both business advantages and budget-friendly possibilities when entering the UAE marketplace. Sharjah offers LLC businesses a perfect atmosphere by allowing for flexible organisational methods, tax benefits, helpful governmental programs, and key transportation centres for successful commercial development.
Are you in need of specialised help to address legal documents and obtain both licenses and required approvals? Xpert Advisory helps you. We provide comprehensive assistance for your UAE LLC setup process, which covers both legal documentation needs and approval acquisition. So, reach out now to get continuous support, which will help your business structure thrive in the long run.
FAQs
What Amount of Minimum Capital is required to start an LLC Business in Sharjah?
Every Sharjah LLC formation has abandoned fixed minimum capital requirements. A business must declare its capital amount in the Memorandum of Association after making sure it covers tactical targets, but without any specific threshold.
What is the Timeline for LLC Registration in Sharjah?
The registration duration of an LLC company setup in Sharjah spans 7 to 10 working days when both documentation submission and time-based approvals from relevant authorities are maintained.
Can I Obtain a Residence Visa Using my LLC as Sponsorship?
Yes, through company sponsorship, LLC operators and staff members qualify to obtain residence visas in the UAE.
