How Much Does It Cost to Set Up a Business?
Introduction
Setting up a business in Dubai is a dream for many entrepreneurs around the world. The city offers great opportunities, a strong economy, and a business-friendly environment. But before you start your journey, one important question comes to mind — how much does it cost to set up a business in Dubai?
In this blog, we will explain everything you need to know about the cost of starting a business in Dubai. We’ll keep the language simple, the tone friendly, and break down every part so it’s easy to understand.
Note:- Start your business in Dubai with ease. Dubai offers 100% foreign ownership, tax benefits, and a strong economy. Whether it’s a mainland, free zone, or offshore setup, we help you choose the right path to grow your business quickly and legally. Get expert help today and set up your business in Dubai without hassle.
Why Do People Want to Start a Business in Dubai?
Dubai is one of the fastest-growing business hubs in the world. People from all over come here to build their dreams. Here are some reasons why:
Business-Friendly Rules
Dubai has very friendly rules and policies for business owners. The government supports entrepreneurs and allows 100% foreign ownership in many areas.
Strong Economy
Dubai has a powerful and growing economy. It has many sectors like tourism, trade, real estate, technology, and more. This gives you many chances to grow your business.
No Personal Income Tax
One of the best things about Dubai is that there is no personal income tax. That means you can keep more of the money you earn.
Location Advantage
Dubai is in a great location between Europe, Asia, and Africa. This makes it a perfect place for import and export businesses.
Types of Business Setup Options in Dubai
Before we look at the costs, it’s important to understand the different types of business setup options. The cost depends on the type of company and location you choose.
Mainland Company
A mainland company lets you do business anywhere in the UAE and outside the country. You will need to get a license from the Department of Economic Development (DED). You may also need office space and a local sponsor for some activities.
Free Zone Company
A free zone company allows 100% foreign ownership. You can do business inside that specific free zone and internationally. Each free zone has its own rules and fees.
Offshore Company
An offshore company is set up for international trading or holding assets. You cannot trade within the UAE. It’s good for people who want to do business globally with fewer requirements.
What Are the Main Costs of Starting a Business in Dubai?
Let’s now look at the different types of costs you should expect when setting up a company in Dubai.
1. Business License Cost
This is the first and most important cost. You need a license to operate legally. The cost depends on your business activity and the area (mainland or free zone).
- Mainland license: AED 10,000 to AED 15,000 (on average)
- Free zone license: AED 5,000 to AED 15,000 (varies by free zone)
- Offshore license: AED 10,000 to AED 12,000
2. Trade Name Registration
You need to choose a name for your company and register it. This usually costs around AED 600 to AED 1,000. If you want a special name or one with foreign words, it may cost more.
3. Initial Approval Fee
You have to get an initial approval from the government to start your business. This is usually around AED 100 to AED 1,000.
4. Office Space or Virtual Office
If you choose a mainland company, you must have a physical office. Free zones may allow shared desks or virtual offices.
- Small office in mainland: AED 15,000 to AED 30,000 per year
- Shared desk in free zone: AED 8,000 to AED 15,000 per year
- Virtual office: AED 4,000 to AED 10,000 per year
5. Visa Costs
You will need a visa for yourself and maybe for your employees. This includes medical tests, Emirates ID, and residency fees.
- Investor visa: AED 3,500 to AED 7,000
- Employee visa: AED 5,000 to AED 7,000 (per person)
6. Local Sponsor or Service Agent Fee
If your business requires a local sponsor (in some mainland activities), you may have to pay an annual fee.
- Sponsor fee: AED 8,000 to AED 20,000 per year (depending on the sponsor)
7. Other Government Fees
There are other small fees like:
- Document attestation
- MOA (Memorandum of Association) drafting
- Notary fees
- Commercial registration
These may cost around AED 2,000 to AED 5,000.
Estimated Total Cost Based on Business Type
Now let’s look at rough total costs for each type of business setup. These are only average values and can change depending on your case.
Mainland Company Setup
- License Fee: AED 12,000
- Office Rent: AED 20,000
- Visa Cost (1 person): AED 5,000
- Sponsor Fee: AED 12,000
- Other Fees: AED 3,000
Estimated Total: AED 52,000
Free Zone Company Setup
- License Fee: AED 10,000
- Virtual Office: AED 8,000
- Visa Cost (1 person): AED 5,000
- Other Fees: AED 2,000
Estimated Total: AED 25,000
Offshore Company Setup
- License Fee: AED 11,000
- No office needed
- No visa needed (usually)
- Other Fees: AED 2,000
Estimated Total: AED 13,000
Things That Can Change Your Business Setup Cost
Every business is different. There are a few things that may increase or decrease your cost.
Number of Visas
The more people you need visas for, the higher your costs will be. Each visa has its own charges.
Office Size and Location
If you choose a bigger office or one in a premium location, rent costs will go up.
Business Activities
Some activities (like medical or food-related businesses) need extra approvals and inspections. These can cost more.
Type of License
There are different types of licenses like commercial, industrial, or professional. Each has different fees.
Ways to Save Money When Starting a Business
It is always good to keep your costs low, especially when you are just starting. Here are some tips:
Choose a Free Zone
Free zones often offer packages that include license, office, and visa in one cost-effective bundle.
Go for a Virtual Office
If your business does not need a physical location, choose a virtual office to save rent.
Pick the Right Business Activity
Be clear about what you want to do. Choose the right business activity to avoid extra charges or license changes later.
Use a Business Consultant
Business setup consultants can guide you and help avoid costly mistakes. They also know where to find the best deals and offers.
Is It Worth Setting Up a Business in Dubai?
Yes, even though the initial cost may seem high, setting up a business in Dubai is often worth it. You get access to a global market, no personal tax, and full ownership in many areas. With the right planning, you can grow your business fast and make good profits.
Final Thoughts
Setting up a business in Dubai involves some cost, but the benefits are great. Whether you choose a mainland, free zone, or offshore setup, there are options to fit your budget and needs.
To quickly recap:
- Free zone setups are more affordable and allow 100% foreign ownership.
- Mainland companies let you trade anywhere in the UAE.
- Offshore companies are good for global trading and holding assets.
Always plan ahead, understand your needs, and speak with a professional if needed. With the right help, you can start your business smoothly and begin your journey toward success in Dubai.
For more insightful articles related to this topic, feel free to visit future tech radar.