UAE Freelance Hiring Guide: Licenses, Contracts and Compliance 2025

Hiring freelancers offers UAE businesses flexibility and access to specialized skills without full-time employment commitments. However, proper engagement requires understanding license requirements, structuring appropriate service agreements, and avoiding misclassification risks. This guide covers everything businesses need to know about hiring freelancers in UAE.

Aspect	Details
License Required	Yes, for UAE-based freelancers
WPS Applicable	No (service fee, not salary)
Relationship	Client-Contractor (not employer)
Benefits	Not applicable
Taxation	Corporate tax may apply

Freelance Permits

Understanding freelance licenses in UAE.

Types of Freelance Permits

MOHRE Freelance Work Permit for mainland activities. Free zone freelance licenses from various free zones. GoFreelance by DSO (Dubai Silicon Oasis). Dubai Media City and other specialized free zones. Abu Dhabi freelance permits through twofour54 and others.

MOHRE Freelance Permit

Introduced under Ministerial Resolution No. 31 of 2023. Available to UAE residents on valid visa. Allows freelance work alongside regular employment. Professional activities matching qualifications. Annual fee and specific activity categories.

Free Zone Freelance Licenses

Self-sponsored visa included. Specific activity categories permitted. Variable costs by free zone (AED 7,500-15,000 typical). Annual renewal required. Can work with clients across UAE and internationally.

Verification Requirements

Before engaging a freelancer, verify: Valid trade license or freelance permit. Permitted activity matches required services. License validity dates. Immigration status (if UAE-based). Professional qualifications if relevant.

License Type	Issuer	Visa Included	Typical Cost
MOHRE Freelance Permit	MOHRE	No	AED 500-1,500
DSO GoFreelance	Dubai Silicon Oasis	Yes	AED 7,500+
DMC Freelance	Dubai Media City	Yes	AED 15,000+
ADGM Freelance	ADGM	Yes	USD 1,100+
Fujairah Creative City	Creative City	Yes	AED 8,500+

Hiring Process

Steps to properly engage freelancers in UAE.

Step 1: Define Requirements

Scope of work clearly documented. Deliverables specified. Timeline established. Budget determined. Skills and qualifications needed.

Step 2: Source Candidates

Professional networks and referrals. Freelance platforms (Upwork, Fiverr, local platforms). Industry-specific communities. LinkedIn and professional associations. Free zone talent pools.

Step 3: Verify Credentials

Review portfolio and past work. Check references. Verify license and permits. Confirm immigration status. Assess professional qualifications.

Step 4: Negotiate Terms

Project fee or hourly rate. Payment schedule and milestones. Revision and change order process. Intellectual property ownership. Confidentiality requirements.

Step 5: Execute Agreement

Prepare service agreement. Both parties sign. Retain copies for records. Set up payment method. Begin project with kickoff meeting.

Service Agreements

Essential elements of freelance service contracts.

Key Contract Terms

Parties: Client and contractor details with license numbers. Scope: Detailed description of services. Deliverables: Specific outputs required. Timeline: Start, milestones, and completion dates. Fees: Amount, currency, and payment terms.

Intellectual Property

Ownership of created work (typically transfers to client on payment). Pre-existing IP remains with original owner. License grants for background IP. Portfolio rights for freelancer. Third-party IP clearance responsibility.

Confidentiality

Definition of confidential information. Obligations of non-disclosure. Duration of confidentiality. Exceptions (publicly available, legally required). Return or destruction of materials.

Liability and Indemnity

Limitation of liability clauses. Indemnification for third-party claims. Professional indemnity insurance requirements. Warranty of work quality. Remedies for defective work.

Dispute Resolution

Governing law (typically UAE). Dispute resolution mechanism. Negotiation and mediation first. Arbitration or court jurisdiction. Language of proceedings.

Misclassification Risks

Understanding and avoiding employment misclassification.

What is Misclassification?

Treating an employee as an independent contractor. Avoiding employment law obligations. Denying worker protections and benefits. Common issue globally and increasingly scrutinized in UAE.

Red Flags for Misclassification

Control over how work is performed (not just results). Set working hours and location. Exclusive or near-exclusive engagement. Integration into company operations. Provision of equipment and workspace. Long-term indefinite engagement.

Consequences

Reclassification as employee with back-dated rights. Payment of unpaid benefits (leave, gratuity). MOHRE fines and penalties. Visa violations if worker improperly sponsored. Reputational damage.

Best Practices to Avoid

Engage for specific projects with defined scope. Allow control over methods and schedule. Permit work for multiple clients. Use service agreement, not employment contract. Pay per project/deliverable, not monthly salary. Freelancer provides own equipment.

Factor	Employee	Freelancer
Control	Company directs how work is done	Controls own methods
Schedule	Set working hours	Flexible schedule
Exclusivity	Works only for employer	Multiple clients
Equipment	Company provides	Provides own
Integration	Part of company structure	External service provider
Duration	Ongoing indefinite	Project-based

Payment and Compliance

Financial and regulatory requirements for freelance payments.

Payment Methods

Bank transfer (local or international). Payment platforms (PayPal, Payoneer, Wise). Cheque (less common). Cash (not recommended for documentation). Credit card through invoicing platforms.

WPS Not Applicable

Freelancers are not employees. Service fees not subject to WPS. No salary file required. Payment based on invoice. Terms per service agreement.

Invoice Requirements

Freelancer's business name and license number. Client's business details. Description of services rendered. Amount and payment terms. Tax registration number (if VAT registered).

VAT Considerations

Freelancer may be VAT registered (if revenue exceeds AED 375,000). Client claims input VAT if VAT registered. Proper tax invoices required. Reverse charge for certain services. International service VAT rules apply.

Corporate Tax

UAE Corporate Tax effective June 2023. Freelancers with revenue over AED 1 million subject to tax. 9% rate on profits above AED 375,000. Business expense deductions available. Annual filing requirements.

Termination and Disputes

Ending freelance engagements and handling conflicts.

Termination Provisions

Per service agreement terms. Notice period if specified. Payment for completed work. Return of materials and information. Surviving clauses (confidentiality, IP).

Early Termination

Client may terminate for convenience (with payment for work done). Termination for cause (material breach). Cure period for remediable breaches. Kill fee or cancellation payment if agreed.

Dispute Resolution Steps

Step 1: Direct negotiation between parties. Step 2: Mediation if negotiation fails. Step 3: Arbitration per agreement. Step 4: Court action if no arbitration clause. Note: Labor courts do not have jurisdiction over genuine freelance disputes.

Common Dispute Areas

Scope creep and additional work. Quality of deliverables. Payment delays or non-payment. Intellectual property ownership. Confidentiality breaches. Misclassification claims.