Vacation Rental License Dubai: Your 2025 Guide to Setup

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Dubai’s skyline isn’t the only thing reaching new heights. With a staggering 17.15 million international overnight visitors in 2023, the city has firmly cemented its status as a global tourism powerhouse. This unprecedented influx of travellers, combined with a robust real estate market, has created a golden opportunity for savvy investors and property owners: the short-term vacation rental market. As tourists increasingly seek authentic, flexible, and spacious accommodation, the demand for holiday homes has skyrocketed.

However, capitalizing on this lucrative trend requires more than just a beautiful property and an online listing. Dubai operates a highly regulated market to ensure quality and safety for all. This definitive 2025 guide is designed to walk you through every critical step of securing your Vacation Rental License Dubai, transforming your property asset into a high-yielding, legally compliant business venture.

The Regulatory Authority: Understanding the Role of the DET

Before embarking on your journey, it’s crucial to understand the governing body that oversees the entire holiday home sector in the emirate. The Dubai Department of Economy and Tourism (DET), which absorbed the responsibilities of the former Department of Tourism and Commerce Marketing (DTCM), is the sole authority for regulating and licensing all short-term rental activities.

The DET’s mandate is comprehensive and serves several key purposes:

  • Standardization: It establishes and enforces minimum quality standards for all listed properties, covering everything from furniture and amenities to health and safety protocols.
  • Accountability: It creates a transparent framework that holds property owners and operators accountable for the guest experience.
  • Guest Protection: It provides a regulated environment where tourists can book with confidence, knowing their rights are protected.
  • Market Growth: By ensuring a high-quality, reliable offering, the DET helps sustain the long-term growth and reputation of Dubai’s tourism industry.

Operating a holiday home without a valid permit from the DET is a serious violation. The risks are substantial and far outweigh any perceived benefits of circumventing the system. Penalties can include severe fines starting from AED 10,000, the potential for your property to be blacklisted from all booking platforms, and significant legal repercussions. In short, a DET permit is not optional; it is the fundamental requirement for legal operation.

Step-by-Step: How to Get Your Vacation Rental License in Dubai

The process of obtaining your permit is structured and methodical. By following these steps carefully, you can ensure a smooth and efficient setup. We’ve broken down the entire journey, from forming your company to welcoming your first guest.

The very first requirement is that your holiday home business must be operated under a legally registered company in Dubai. You cannot obtain a permit as an individual. This is because short-term letting is a commercial activity that requires a proper trade license. You have two primary pathways for this: a Mainland Company or a Free Zone Company.

Option A: Dubai Mainland Company

A mainland company is registered directly with the Dubai Department of Economy and Tourism. This is often the most direct and recommended route for a vacation rental business.

  • Pros:
    • Unrestricted Operation: You can manage properties located anywhere in Dubai without restrictions.
    • Direct Licensing: The trade license and the DET permit are processed through aligned government bodies, which can streamline the process.
    • Market Access: Full access to the local Dubai market for any future business expansions.
  • Cons:
    • Local Service Agent (LSA): For 100% foreign-owned professional licenses, a UAE national must be appointed as a Local Service Agent. They have no equity in the business but are paid an annual fee.
    • Cost: Setup costs can sometimes be slightly higher than in certain free zones.

For a detailed breakdown of the process, explore our guide on Dubai Mainland Company Formation.

Option B: Free Zone Company

A free zone company offers benefits like 100% foreign ownership without the need for an LSA. However, for a vacation rental business, this route comes with an important caveat.

  • Pros:
    • 100% Foreign Ownership: You retain full control and ownership of your enterprise.
    • Potential Tax Advantages: Free zones often offer guaranteed 0% corporate and personal income tax for a set period (though you must still register and comply with UAE Federal Corporate Tax law).
  • Cons:
    • Operational Restrictions: A free zone company is technically licensed to operate within that free zone. To manage properties on the mainland (where most residential properties are), you will likely need a secondary permit or a service agent agreement, adding a layer of complexity and cost.
    • Suitability: While excellent for many business types, free zones like DMCC may not be the most straightforward choice specifically for a holiday home business that operates across the city.

Our Recommendation: For most investors focused purely on the vacation rental market, a Dubai Mainland company provides the most direct, compliant, and scalable foundation for your business.

Step 2: Initial Application and Document Submission

Once your trade license is issued, you can begin the DET permit application process. This is primarily done through the DET’s dedicated online portal. You will need to prepare a comprehensive file of documents for submission.

Required Documents Checklist:

  • A completed application form.
  • A copy of the valid trade license for your Dubai company.
  • Passport copy of the property owner(s) or company manager.
  • Emirates ID copy (if a UAE resident).
  • The property’s Title Deed (if you own the property).
  • If you are renting the property to then sublet as a holiday home, you need:
    • A valid Ejari (tenancy contract).
    • A No Objection Certificate (NOC) from the property owner explicitly permitting you to use the unit as a holiday home.
  • Recent DEWA (Dubai Electricity and Water Authority) bill for the property.
  • A signed property management agreement between the owner and your licensed company (if you are managing properties for others).

Submitting a complete and accurate file is critical to avoid delays. The DET portal is designed to be user-friendly, guiding you through each section of the application.

Step 3: Property Approval and Classification

After your initial application is accepted, the DET will schedule an inspection of the property. The goal is to ensure your unit meets the required quality and safety standards. This is a non-negotiable step in obtaining your Vacation Rental License Dubai.

DET Property Requirements:

Your property must be fully furnished and equipped to a high standard. While an exhaustive list is provided by the DET, key requirements include:

  • Furniture & Furnishings: Comfortable beds with quality mattresses and linen, adequate seating in living areas, a dining table and chairs, and sufficient wardrobe space.
  • Kitchen & Appliances: A fully equipped kitchen with a refrigerator, cooker, microwave, kettle, toaster, and a complete set of cutlery, crockery, and cooking utensils. A washing machine is also mandatory.
  • Safety & Security: A fire extinguisher, smoke detectors, a fire blanket, and a first-aid kit are all essential.
  • Amenities: High-speed internet (Wi-Fi), a television with a basic subscription, an iron and ironing board, and a hairdryer.
  • General Condition: The property must be clean, well-maintained, and free from any hazards.

During the inspection, a DET official will visit the property and check it against their detailed checklist. Upon a successful inspection, your property will be classified as either Standard or Deluxe. This classification is based on the quality of furnishings, the size of the unit, and the available amenities. The classification impacts the amount of Tourism Dirham you will collect.

Step 4: Obtaining the Final Permit

Once your property passes the inspection and is officially classified, you will proceed to the final stage. This involves paying the required permit fees through the online portal. After the payment is confirmed, the DET will issue your official holiday home permit.

This permit is a digital certificate that includes a unique permit number for your property. This number is your key to the market. Major booking platforms like Airbnb, Booking.com, Vrbo, and others are integrated with the DET system. You must display this permit number on your listings to legally advertise and accept bookings. Operating without it can lead to your listings being removed and penalties being issued.

Step 5: Understanding and Paying the Tourism Dirham Fee

The Tourism Dirham is a minimal fee levied on guests for every night they occupy a room in any hotel or holiday home in Dubai. As a licensed operator, you are legally responsible for collecting this fee from your guests and remitting it to the DET.

How it Works:

  • Calculation: The fee is calculated per bedroom, per night of occupancy.
    • Standard Holiday Home: AED 10 per bedroom, per night.
    • Deluxe Holiday Home: AED 15 per bedroom, per night.
    • Example: A 2-bedroom Deluxe apartment booked for 5 nights would incur a Tourism Dirham fee of (15 AED x 2 bedrooms x 5 nights) = 150 AED.
  • Collection: You must add this fee to your guest’s final bill. It should be clearly itemized.
  • Remittance: You