Starting a Business in Dubai? Understand the Full Cost of Company Formation

Dubai remains one of the top business destinations in the world due to its tax incentives, strategic location, and world-class infrastructure. But before you dive in, it’s important to understand the cost of setting up a business in Dubai. Whether you are forming a company in a free zone, establishing a mainland business, or setting up an offshore company, there are various costs to consider. In this guide, we break down all the key expenses involved in starting a business in Dubai, from license fees to government charges.

All Services

Ready to Set Up Your Business in Dubai? Get a Free Consultation Today!

Starting a business in Dubai can be a rewarding opportunity, but understanding the costs upfront is essential to making an informed decision. If you’re ready to take the next step, contact us today to receive a personalized consultation and detailed cost breakdown tailored to your business needs.

Starting a Business in Dubai? Understand the Full Cost of Company Formation

When setting up a business in Dubai, understanding the full cost of the business setup is essential. Knowing the costs upfront allows you to make informed decisions, avoid surprises, and choose the most cost-effective setup that aligns with your business goals. Here’s why it’s important to understand the cost to start a business in Dubai:

Budget Planning: Setting realistic financial expectations is key. Knowing the Dubai company setup cost allows you to allocate your budget properly, ensuring you have enough funds to cover all costs.
Choosing the Right Setup: Dubai’s free zone business and mainland company setup have different cost structures. Understanding the costs allows you to select the most suitable option for your business.
Efficient Financial Management: By understanding the breakdown of expenses, including business license fees, office space costs, and visa fees, you can plan for a more efficient setup and avoid unexpected costs.

Types of Business Setup Costs in Dubai

When planning your business setup in Dubai, it’s essential to understand that costs vary based on the type of business structure you choose. Below we break down the key costs involved in both free zone and mainland setups:

Free Zone Setup:
Ideal for businesses that want 100% ownership and tax exemptions.
Costs generally range from AED 10,000 to AED 30,000 depending on the free zone and the type of license required.
Includes: License fees, office rental, government registration fees, and visa costs.
Interested in knowing more about Dubai Free Zones?

Mainland Setup:

Suitable for companies that wish to operate throughout the UAE.
Costs are higher due to the need for a local sponsor (for foreign investors).
Typical costs range from AED 15,000 to AED 50,000 or more, depending on the business activity and office location.
You may want to check out the steps to form a company in Dubai for further insights.

LLC Setup:

For businesses that plan to have physical offices in Dubai and employ staff.
Initial costs typically start from AED 20,000 to AED 80,000, depending on your business needs.
Learn more about starting your business in Dubai as an expat if you are an expatriate planning to set up.

Step-by-Step Guide to Starting a Company in Dubai

Setting up a business in Dubai can be a rewarding opportunity, but understanding the full process helps you avoid delays and manage costs effectively. Here’s a clear, step-by-step breakdown:

1. Choose Your Business Activity

The first step is to define your business activity, whether it’s commercial, professional, or industrial. This will determine your business license type and legal requirements.

2. Reserve a Trade Name

Choose a unique trade name that meets government naming criteria. The Department of Economic Development (DED) or your chosen free zone authority will approve the name.

3. Decide on a Legal Structure

Your business can be formed in one of three jurisdictions:

Mainland business setup in Dubai

Freezone business setup in Dubai

Offshore business setup in Dubai

Each option has specific ownership rights, visa rules, and tax benefits.

4. Apply for a Business License

Apply for your license through the relevant authority. Learn about the different types of business licenses in UAE or explore the Dubai business license guide for in-depth information.

5. Secure Office Space or a Virtual Office

Whether you’re going for a mainland business setup or freezone business setup, you’ll need a business address. If budget is a concern, consider low cost business setup in Dubai options with shared desks or virtual spaces.

6. Submit Required Documents & Get Approvals

You’ll need to submit documents such as the MOA, shareholder details, and passport copies. For complete guidance, visit our page on steps to form a company in Dubai.

7. Pay Government and Registration Fees

Government fees vary based on jurisdiction and business type. Refer to the complete business setup cost in Dubai for updated figures and what’s included.

8. Apply for Establishment Card & Visas

Apply for your company’s immigration (Establishment) Card and relevant visas:

Planning a business setup without visa in Dubai?

Or setting up as an expat? Learn more about starting your business in Dubai as an expat

You can also explore 100% ownership options in Dubai for full control over your business.

9. Open a Corporate Bank Account

Once your business is licensed, open a corporate bank account. Our business setup consultants in Dubai can help you through the process smoothly and efficiently.

Cost Breakdown by Business Type and Location

Understanding the cost of business setup in the UAE requires considering several key factors, such as business type, company location, and the services you require. Below is a detailed breakdown of the main costs you can expect:

1. Free Zone Company Setup (Dubai and Other Emirates)

Starting a business in one of the UAE’s popular free zones offers significant cost savings and a streamlined process. However, fees vary by free zone.

Average Setup Cost: AED 10,000 – AED 20,000

Key Costs:

License Fee: AED 7,000 – AED 15,000
Visa Fee: AED 3,000 – AED 5,000 per employee
Office Space: Starting from AED 5,000 annually
Registration & Documentation: AED 2,000 – AED 3,000

Looking for a more specific breakdown for free zones in Dubai? Check out our Dubai Free Zone Company Setup Guide.

2. Onshore Company Setup (Dubai, Abu Dhabi, Sharjah)

An onshore company setup allows you to operate directly within the UAE market, but it comes with higher costs due to local sponsorship and additional regulations.

Average Setup Cost: AED 15,000 – AED 30,000

Key Costs:

Trade License Fee: AED 10,000 – AED 20,000
Local Sponsor Fee: AED 5,000 – AED 10,000 annually
Visa Fee: AED 5,000 per employee
Office Rent: AED 10,000 – AED 25,000 annually

If you’re interested in setting up a mainland business in Dubai, visit our page on Mainland Business Setup in Dubai.

3. Offshore Company Setup

Offshore companies in the UAE allow for international trade but restrict local business operations. These are typically cheaper and quicker to set up.

Average Setup Cost: AED 8,000 – AED 15,000

Key Costs: