You may have heard that moving to Dubai means no taxes, and felt interested.

In fact, the difference in the tax burden on individual salaries and certain investment income is a major reason why affluent individuals consider Dubai. When thinking about asset management after selling a company, starting a business overseas, or providing for a family's lifestyle, it can be a compelling option.

However,Money received by individuals, profits earned by companies, and tax relations remaining in Japan are separate matters. Just creating a company in Dubai does not mean a system where taxes disappear while living in Japan.

This paper explains the reasons why Dubai is chosen, focusing primarily on cases where wealthy Japanese individuals and owner-executives actually relocate their living bases, and sequentially covers free zones, corporate establishment, residency visas, bank accounts, and Japanese taxation.

1. The appeal of Dubai is that you can consider tax rates and business locations together.

Dubai is one of the emirates that make up the United Arab Emirates (UAE). The corporate tax and other matters covered in this paper are primarily based on the UAE federal system, while Dubai authorities are also involved in company licensing and immigration procedures.

One of the attractions is how personal income is handled. Explanation by the UAE Federal Tax Authority (FTA) Then, we exclude salaries, certain personal investment income, and certain personal real estate investment income from business activities subject to corporate tax. A system that does not levy a general personal income tax Combined with this, it is significant for workers and asset managers when considering the money they have left over.

Another is the presence of an international business and financial hub. The financial regulatory authority of the Dubai International Financial Centre (DIFC)Publication of DFSA's 2025 performance results According to the report, the number of registered and authorized entities subject to regulation has reached 1,050. This shows that businesses such as banks, asset management firms, and insurance companies are concentrated there.

Also, Emirates' international network This serves as material for business owners with customers and investments in multiple regions to consider Dubai as their operational base.

Beyond the tax burden, where to work, with whom to trade, and how to live with family—for those whose combination fits, there is a reason to choose Dubai.

2. The difference between Singapore and Dubai as seen on a globe

Singapore is the gateway to Asia, and Dubai is the global hub connecting Europe, Asia, and Africa. This is a perspective that views the locations of both cities in terms of the scope of a business executive's activities. Singapore is also a global hub, but when you look at a globe, you can see the differences in the regions that are easy to connect.

A conceptual diagram explaining spatial relationships. The lines are intended to show connections to regions, and do not indicate actual air routes or flight distances.

Singapore is located in Southeast Asia, making it an easy choice as a base for expanding business in Japan, China, India, and ASEAN. On the other hand, Dubai is located on the Arabian Peninsula, situated between Europe, Africa, and South Asia. For those whose customers and investment targets span multiple continents, this geographical positioning is significant.

The number of passengers Ministry of Transport, Singapore and Dubai Airports' 2025 results According to. This is the total number of people who used the airport, not the number of residents or wealthy individuals. As of the end of 2025, Dubai International Airport connects to 291 destinations in 110 countries.

Comparing only tax rates makes you overlook this difference.Which markets you frequently visit, where your customers and family are. You choose a destination for relocation taking that movement into account as well.

3. Why is it possible to run a government without personal income tax?

"If they don't take income tax, where does the government's money come from?" The answer is revenue sources other than income tax. First, let's look at the track record of the Government of Dubai.

Source: Ministry of Finance revenue table published in the Dubai government funding materials is. The composition ratios are calculated from the same table.

Fees and dividends from government-related enterprises account for approximately 75% of revenue. Fees related to real estate registration, visas, tourism, and transportation are also government revenue sources. Dividends are distributions received from government-invested enterprises, and not all of those enterprises' sales go to the government.

If you think, “It’s because of oil,” you’ll misunderstand this structure. The Dubai government’s oil and gas revenue shown in this table is approximately 4%. Tax revenue also amounts to about 21%, so it’s not as if there are no taxes at all. The fact that people and businesses gather in the city and engage in economic activity is what generates revenue sources such as fees and corporate dividends.

Also, Dubai is not an independent country but part of the UAE. UAE Federal Government Budget for 2026 Also, it is supported not only by tax revenues, but also by service fees, investment returns, and contributions from the emirates and others. This is the federal budget and is accounted for separately from the Dubai government's performance mentioned above.

In other words,Not having personal income tax is different from having no burden on daily life and business. When comparing relocation, you need to consider expenses such as licenses and visa renewals, housing, and schooling, in addition to taxes.

A city where about 90% of the residents are of foreign nationality

Dubai population demographics by nationality (revised 2024 values) Then, out of a total population of about 4.25 million, non-UAE nationals number about 3.95 million. Calculating that,Approximately 931 TP3T are foreign nationalsis. This is not the ratio for the entire UAE, but the figure for the resident population of the Emirate of Dubai.

Foreigners are not limited to a small number of expats; they make up the majority of the city's population. However, these figures represent the nationality breakdown and do not mean everyone is wealthy. Having a large foreign-born population is also separate from everyone being able to obtain permanent residency, and individuals must secure residency qualifications for themselves and their families.

First, separate "migration for starting a business" from "migration centered on asset management"

When considering relocation, people tend to first research "which free zone to set up a company in." However, not everyone needs a company.

For example, if someone sells their company and takes a break from business, but sets up a company solely for the sake of a visa, administrative burdens such as license renewals, accounting, and tax filings will continue. On the other hand, if they are genuinely conducting business locally, they need to obtain permits that suit those activities.

Instead of choosing a product based on the idea that "buying a company allows you to migrate," the starting point is to choose the necessary procedures based on your life and work after migration.

5. What is a Free Zone? — It is not a place where you can do business freely and tax-free

A free zone is an area where a dedicated authority handles company registration, business licenses, and other matters. There are establishment options depending on the business sector and required facilities.

When considering a company in Dubai, keep the following differences in mind.

Explanation of foreign company ownership in the UAE government That said, on the mainland as well, foreign ownership of 100% is permitted in many businesses. The statement that “on the mainland, 51% must always be transferred to local residents” cannot be applied as is. Different conditions apply to strategically important industries and the like.

Compare candidates from IT, digital, FinTech, and blockchain companies side-by-side.

Company incorporation locations are not limited to DMCC, DIFC, and JAFZA. Depending on your specific business activities—such as software development, IT consulting, financial systems, or blockchain—you can compare the following alternatives.

Based on our firm's support experience, many IT and digital clients choose DMCC or IFZA. However, the most suitable establishment location varies depending on the nature of the business.Even with the same "FinTech," the required licenses differ between companies that develop software for financial institutions and those that hold customer funds for payments and investments.

For example, DWTC crypto asset business guide Now, the mechanism combining a free zone commercial license and VARA approval is shown. Description of IFZA IT Consulting License Also, it distinguishes between consulting and software production and sales. Not only the name of the establishment destination, but also the scope of the applied business is important.

Other than Dubai, there are also ADGM and RAK DAO.

RAK DAO's Legal notices It also clearly states the restrictions on regulated activities. This does not mean that, because it is a digital asset free zone, exchange and custody services can be conducted freely.

Choosing a free zone begins with your industry and specific business activities. However, it is not automatically determined that "for this industry, it's this single location." If there are multiple candidates that can accommodate the same operations, we narrow them down based on the customer's location, facilities, additional approvals, recruitment, and costs.

This is not a ranking. For example, a consulting firm that does not handle physical goods and a company that handles import/export and storage require different locations and facilities.

DMCC incorporation package Also, the conditions vary depending on the period and content. For comparison, we provide quotes under the same conditions not only for the first-year advertising price, but also for renewals from the second year onward, office space, number of visas, and accounting/tax returns.

Operating outside the free zone is a licensing issue.

The explanation that "Free Zone companies cannot conduct any business within the UAE mainland" is also too simplistic. DET announced a licensing system in October 2025 for Free Zone companies to operate on the mainland am doing.

What is necessary is to check which permits are required for our business operations under the current system.Whether a business activity is recognized as such and whether corporate income tax rate 0% applies to the income from that activity are two separate matters.

In addition, an offshore company cannot be treated in the same way as a regular company for immigration and employment purposes. Explanation of JAFZA company types For example, you can check for a system that suits your purpose.

6. If you're a tech entrepreneur, you should also compare Abu Dhabi's Hub71.

Even if you are considering moving to Dubai, depending on the nature of your business, the neighboring emirate of Abu Dhabi may be an option. A prime example of this is Hub71 It is a hub that connects investors, large corporations, local governments, experts, and startups to support their growth.

Here, it will be easier to understand if you separate the names.

The choice to relocate in order to gain capital and business opportunities

Hub71 Access Program is a selective 12-month support program targeting companies from the early startup stage to Series A. It offers the equivalent of 250,000 dirhams in-kind services and 250,000 dirhams in cash via SAFE. At least one founder is expected to relocate to Abu Dhabi long-term and build a local team.

SAFE is a financing agreement involving future equity stakes. Hub71 FAQ It also explains it as a mechanism for granting shares in the future. This is not about getting subsidies unconditionally just by starting a company. We will make a decision after checking not only the funding, but also the impact on equity and the conditions for participation.

For Web3 and blockchain businesses, Hub71+ Digital Assets There is also such specialized support. However, participation in the support and licensing for financial and crypto-asset services are separate matters.

Japanese Entrepreneur Participation Cases: bitgrit and Startale

There are also real-world examples by Japanese entrepreneurs.bitgrit, an AI company led by Katsuya Akinawa, operates out of Hub71. Interview with him by JETRO and the background is introduced in Hub71 Company Profile is also listed as a company originating from Japan.

Additionally, Startale Group, founded by Sota Watanabe, announced its selection for Hub71"s Digital Assets cohort in April 2026. Participation in Hub71+ Digital Assets can also be confirmed through Hub71's corporate profile. Although it is a company founded by a Japanese entrepreneur, its headquarters are in Singapore.

Our firm has supported both bitgrit and the Startale Group. Abu Dhabi is indeed a chosen base for businesses originating in Japan and Japanese entrepreneurs. However, the timing of participation and the programs for the two companies are not the same, which does not mean that the aforementioned support amount applies directly to both companies.

It's not like "any IT company will do"

ADGM Tech Startup License Then, innovative and high-growth business models and the like are required, and a letter demonstrating Hub71 eligibility is also necessary. It is clearly stated that mere technology service providers are not eligible. You must not assume that this letter and acceptance into Access follow the same procedure.

In other words, even for the same "IT company," your options will change depending on what kind of services they provide and what business model they use.Instead of choosing a country just for tax savings, choose a location to meet customers and funding sources. Hub71 is an option that can be considered from that perspective.

7. It is easier to understand Dubai's taxes if you separate "individuals" and "companies"

When was corporate tax introduced — It's different from the "old Dubai"

The UAE's tax system has changed over the past few years. While there has been taxation at the emirate level on natural resource businesses and foreign banks for some time, a federal corporate tax broadly targeting business profits is a new system.

The announcement in January 2022 the Ministry of Finance's explanation at the time, and the start of application is Current Corporate Tax System Guide You can check with. This does not mean that prorated taxation was applied to all companies simultaneously starting from June 1, 2023.

Also, Provisions on natural resource business under the Federal Corporate Tax Act Well, it carries over the old system Dubai foreign bank taxation law You can also check the conventional taxation.

Then why did you introduce it? Ministry of Finance 2022 Annual Report is explaining the securing of stable revenues, economic diversification, and compliance with international tax transparency.

2025's Domestic minimum top-up tax As a general rule, this applies to multinational enterprise groups and others where the consolidated worldwide revenue for two or more of the immediately preceding four fiscal years is 750 million euros or more. The tax rate for general entrepreneurs did not all become 15%.

You need to look at the current tax rates and applicable conditions rather than deciding to establish a company based on the old image that Dubai companies are exempt from corporate tax.

Even individuals, if they are "conducting business," are evaluated separately.

FTA materials for individuals Therefore, if an individual conducts business in the UAE and their total business revenue exceeds 1 million UAE Dirhams (AED) in a calendar year, they are subject to corporate tax. Even though it is called "corporate tax," the targets are not limited to corporations.

Meanwhile, certain salary, personal investment, and personal real estate investment income are excluded from the determination of business sales. Regarding personal investments, it is presupposed that they are activities conducted as an individual and do not fall under activities through licenses or activities requiring licenses.Operating without a license does not mean it is tax-exempt.

The general corporate income tax rate is 0% on taxable income up to 375,000 dirhams, and 9% on the portion exceeding that amount.

Explanation of the UAE Ministry of Finance's general tax rate has the following structure.

This is not a calculation where you multiply revenue by 9%. It applies to the profit after tax adjustments, which is taxable income.

For example, assuming the annual taxable income of a company subject to the general regime is 2 million dirhams, the corporate tax amount without considering any special exemptions or reductions would be(2,000,000 - 375,000) * 9% = 146,250 dirhamsIt is. The ratio to the total taxable income is approximately 7.31%.

This is a hypothetical example showing how the calculation works. Assuming that the Free Zone qualified system or tax reductions for small businesses do not apply, the tax amount will not be the same for the entire company. In addition, for large multinational enterprise groups, alternative minimum tax system There are also.

The 0% in the free zone applies to qualifying income.

In the free zone, there is a system called QFZP (Qualifying Free Zone Person). Under this system, qualifying income that meets the conditions is taxed at 0%, while taxable income that does not qualify is taxed at 9%.You cannot directly use the 0% allowance of 375,000 dirhams from the general system for this 9% portion.

FTA Free Zone Guide And the subsequent Decision on Eligible and Excluded Activities for 2025 Based on this, the points that need to be checked are as follows:

For example, even for a company providing consulting services to Japanese clients, you cannot simply say it is an overseas sale just because of 0%. You need to apply the content and party of the transaction to the classification under the system.

For non-qualified sales, there is a de minimis threshold set at the lower of 5% of total sales or 5 million dirhams. However, because there are special rules for aggregation, this does not mean that “any amount up to this limit is tax-free regardless of the circumstances.”Failure to meet the requirements may result in the loss of eligibility for that tax period and the four subsequent tax periods.

Decision on Audits for 2025 Therefore, QFZP is required to prepare and maintain audited financial statements regardless of its sales. If you are aiming for 0%, you should calculate not only the tax rate but also the maintenance costs required for it.

VAT (Value Added Tax) is also separate. The standard tax rate is 5% And not all transactions are exempt from VAT simply because they are in a free zone.

8. How to get a residency visa—Comparing the corporate route and the investor route

A visa is a matter of "what status you live under." It must be checked separately from business licenses or tax residency determinations.

The above explanation regarding the Golden Visa is based on the application guidelines provided by the Dubai Land Department (DLD). This does not mean that the investor scheme is uniform across the entire UAE.

2 million dirhams isAssuming 1 dirham is 40 yen, that's 80 million yen.This conversion is a hypothetical assumption to get a sense of the amount, not the current exchange rate. In addition to the property price, costs for acquisition, ownership, and application will be incurred.

However, being able to get a visa does not mean that the real estate is a good investment. Whether you will live in it or rent it out, how much the management fees are, and whether you can sell it when you want to, should be considered separately from the visa.

The Golden Visa also has a pathway for entrepreneurs.

The appeal of the Golden Visa is that you can obtain a long-term residency permit by meeting the conditions. With the DLD real estate investor scheme mentioned above, it can be renewed every 10 years. Unlike acquiring permanent residency or citizenship, this requires condition checks, including at the time of renewal.

When purchasing real estate with a mortgage, the DLD guides you to provide a bank letter or similar documentation confirming the down payment amount of 2 million dirhams. Do not make decisions based solely on the listed price of the property; check the mortgage terms, down payment amount, and required bank documents as well.

Also, Dubai's GDRFA offers a 10-year Golden Visa for entrepreneurs We also guide you through this. Because it involves business details, track records, and recommendations/screening by regulatory authorities, this is not a status that can be acquired simply by establishing a normal company. Acceptance into Hub71 also does not mean automatic visa issuance.

Just as people who live mainly off asset management have qualifications for investors, and people who build growth companies have qualifications for entrepreneurs,What you do after immigration will also change how you choose your residency status.

There are also procedures for a spouse and children.

General family sponsorship system of the UAE government Then, in addition to a valid residence status, conditions such as a minimum monthly salary of 4,000 dirhams, or 3,000 dirhams plus housing, are indicated. For schemes like the Golden Visa, family conditions are also checked individually.

We will prepare documents proving marriage and birth, required certifications, medical examinations, housing, health insurance, etc. If you only start looking into family procedures after the principal applicant's company or visa is ready, the schedules for schooling and moving in may not align.

used by residents Emirates ID is the official identification card of the UAE. I will schedule your relocation, including procedures for visas, ID, and family.

9. Corporate establishment, visa, and bank account have separate screenings

If you are migrating to start a business, preparing in the following order will make it easier to organize. The actual application order is adjusted depending on the chosen system and bank.

Emirates NBD Corporate Account Guide However, the submission and review of company licenses, IDs of related parties, company-related documents, and bank statements are required. Being able to set up a company and being able to open a bank account are not the same thing.

I will organize documents that can explain where the funds came from before relocating. For example, if it is proceeds from the sale of a company, contract and deposit documents; if it is assets from investments, acquisition and transaction histories, etc. I will submit them according to what the bank requires.

Do not make the company establishment completion date the start of business or the date of large remittances. I will prepare for it, including the time required for account screening and additional documents.

Cryptocurrency businesses are subject to different regulations than general company establishment.

Holding and managing crypto assets as one's own assets is different from providing services such as trading and custody to others.

VARA License Guide requires firms conducting regulated crypto asset business in or from Dubai, excluding the DIFC, to obtain authorization prior to commencing operations. It cannot be assumed that "because it's a crypto-friendly country, setting up a normal company will also allow you to provide financial services."

10. Do not put Japanese taxation on the back burner after relocation

Getting an overseas visa does not necessarily make you a non-resident of Japan.

The National Tax Agency determines an address based on where a person's life is centered, evaluated through objective facts. and explains that it considers where the center of actual life lies, including Japanese residence, family, and occupation.

Submitting a notification of moving abroad, obtaining a UAE visa, and registering a foreign corporation are each meaningful procedures, but they do not by themselves complete the determination of Japanese income tax liability.

The UAE also has criteria for tax residency. FTA Tax Residency Guide describes paths combining conditions such as a residence permit valid for a stay of 183 days or more in a consecutive 12-month period, or a stay of 90 days or more, housing, or employment.

Whether you spent how many days in the UAE, where you established your center of vital interests for living in Japan, and whether the tax treaty can be applied are separate issues to be confirmed. Tax Residency Certificate from the FTA Also, we separate the purposes for tax treaties and other uses. Simply having the certificate does not automatically determine your non-resident status in Japan.

Owner-operators should be mindful of the exit tax and compensation from Japan.

Exit tax This becomes an issue when the target securities, etc., are valued at 100 million yen or more, and certain conditions are met, such as having had a domicile or residence in Japan for a period exceeding 5 years within the 10 years prior to departure in principle. It is a system under which unrealized gains are taxed, even on unsold shares, etc.

Business owners who hold company shares need to calculate the share price and tax implications at the time of departure before deciding on the sequence of events, such as "we can just sell the company after relocating." Tax payment deferral has conditions, such as the notification of a tax administrator and collateral.

Also, even after becoming a non-resident, Japanese taxation may still apply to executive compensation and other income received from Japanese companies. National Tax Agency's explanation of executive compensation However, working abroad does not automatically make you exempt from taxes in Japan.

If you accumulate profits in a UAE corporation while living in Japan, Controlled Foreign Company (CFC) rules are also under consideration. If a Japanese corporation holds a UAE subsidiary, apart from the owner's personal relocation, the application of CFC (Controlled Foreign Company) taxation rules to that Japanese corporation will also be considered.Changing the name on the invoice to a foreign corporation and actually moving your business or life are different things.

Inheritance tax is also separate from income tax. Taxation of heirs living abroad Now, depending on nationality and past addresses, overseas assets may also be subject to Japanese taxation. Immediately after migrating, family asset succession does not necessarily escape Japanese taxes.

11. Consider the difference in taxes after subtracting living expenses and maintenance costs.

To see the economic impact of migration, looking at tax rate differences alone is not enough. We will create an annual budget for Japan and Dubai, assuming the same family and the same standard of living.

The Dubai government Guide to medical insurance as a necessary system I am doing this. I will make sure not to calculate family medical expenses assuming Japanese insurance can be used as-is.

Tuition costs can be seen specifically from the figures published by the school. For example, Dubai College tuition fees for the 2026–2027 academic year is AED 97,415 per year for Years 7–11, and AED 110,305 per year for Years 12–13.

Assuming 1 dirham equals 40 yen, this is about 3.9 million to 4.41 million yen per person annually. This is an example of tuition fees at the same school and is not the average for all of Dubai. New students are also informed about a 30,000 dirham Personal Debenture, which is refunded upon withdrawal after deducting any unpaid amounts, etc. Tuition fees and the refundable deposit will also be separated.

Even if the tax burden decreases, family education and housing costs may increase. Conversely, even if costs increase, deciding to relocate to obtain desired educational or business opportunities is entirely possible.It is important to think not only about the tax savings, but also about what you want to gain as a family, together with the numbers.

12. When comparing with Singapore, look at the type of income and the location of the work

Tax rates and investment income in Singapore are determined by IRAS (Inland Revenue Authority of Singapore)individual income tax rate and Capital gains from investment assets and Corporate tax rate Based on. Neither explains the exemption of taxation occurring in other countries.

For those whose main focus is salary, differences in personal income tax become important. If individual investment is the main focus, you look not only at the heading "income tax rate," but also at how the profits from held assets are classified. If you run a company, you look at the combined tax burden on both the company and the individual.

Procedures in Singapore are covered in another article. Why are the wealthy moving to Singapore now? explains in.

13. Moving to Dubai is an option for those who can relocate their lives and businesses.

Dubai's tax system holds enough appeal for the wealthy and entrepreneurs to consider. However, whether you can benefit from it depends on the type of income, the substance of your business, and your relationship with Japan.

What we want to decide first is not the name of the free zone.What to do to make a living after relocating, what assets to hold, and where to live with familyOnce that is decided, it will be easier to choose the necessary companies, licenses, visas, and accounts.

There are limits to seeking major tax benefits solely through the registration of a foreign corporation while leaving one's life and work in Japan. On the other hand, for those who can actually relocate their bases of living and business, Dubai is a candidate where tax planning and future business can be designed together.

Our firm has a proven track record of supporting nearly 100 people in relocating to Dubai.

Our firm provides consulting services regarding the determination of residency and non-residency status in Japan, as well as support as a tax representative. Even when considering migration to Dubai, before deciding to establish a company or purchase real estate, let's start by organizing the exit tax, post-migration income, and assets left behind in Japan.