Dubai’s strategic position, tax advantages, and business-friendly atmosphere make it an expanding economic hub that draws businesses from all over the world. Comprehending the expenses associated with setting up a business in Dubai is essential in order to prevent unforeseen costs. To assist you in estimating and reducing costs, this guide breaks down the costs, key factors, and techniques
Factors Affecting Business Setup Costs in Dubai
Business Type (LLC, Sole Proprietorship, etc.)
The type of business entity you choose significantly impacts costs. Limited Liability Companies (LLCs) are among the most common structures due to flexibility and legal advantages but tend to have higher setup costs than sole proprietorships.
Free Zone vs. Mainland Setup
- Free Zone Setup: Ideal for companies targeting international markets, free zones offer tax exemptions and simplified procedures. However, businesses cannot directly trade within the UAE market.
- Mainland Setup: Offers access to UAE’s local market but comes with higher costs, including trade licen
- ses and office requirements.
Considering different business structures? Learn about the pros and cons of Free Zones vs. Mainland companies
License Type (General Trading, Consultancy, E-commerce, etc.)
The type of business license determines your operational scope. General trading licenses often cost more than consultancy or e-commerce licenses.
Business Setup Cost in Different Free Zones
IFZA Free Zone License Cost
Starting at AED 12,500, IFZA offers competitive pricing for entrepreneurs, making it an attractive choice for startups.
DMCC Free Zone License Cost
One of the most prestigious free zones, DMCC license costs start from AED 20,000, varying based on the business activity and office requirements.
RAK Free Zone License Cost
RAKEZ provides economical options for startups, with business licenses starting at AED 11,990, inclusive of a visa package.
JAFZA Company Setup Cost
Known for its strategic location, JAFZA setup costs begin at AED 15,000, suitable for logistics and manufacturing companies.
Explore the advantages of setting up in a Dubai Free Zone
Costs for Setting Up a Limited Liability Company (LLC)
The cost for forming an LLC in Dubai ranges from AED 15,000 to AED 35,000. This includes:
- Trade license fees
- Local sponsor or partner fees (if applicable)
- Additional approvals or certifications, depending on the business activity
Additional Costs in Business Setup
Visa and Immigration Costs
Visa costs range from AED 4,000 to AED 10,000 per employee or partner, depending on the visa type and validity.
Office Space and Infrastructure Costs
- Free zones often provide flexible office packages starting at AED 5,000 annually.
- Mainland businesses typically require physical office space, with rents starting at AED 30,000 per year for smaller spaces.
Bank Account Setup Costs
While opening a corporate bank account in Dubai is essential, some banks may require a minimum deposit ranging from AED 10,000 to AED 50,000.
How to Start a Business on a Budget in Dubai
- Opt for free zones offering discounted license packages.
- Consider shared or virtual office spaces to reduce rental costs.
- Work with experienced business setup consultants to identify cost-saving opportunities and promotions.
Key Considerations When Estimating Business Startup Costs
- Government fees and approvals can change; always check for updates.
- The nature of your business activity may require additional permits or certifications.
- Factor in operational expenses like utilities, employee salaries, and marketing costs.
FAQs
Is it possible to establish a low-investment business in Dubai?
Yes, certain free zones like SHAMS and RAKEZ offer affordable packages for startups.
How much does a mainland license cost in Dubai?
The cost ranges between AED 15,000 to AED 35,000, depending on the license type and approvals.
Do I need to pay the Dubai trade license cost upfront?
Yes, trade license fees are generally paid upfront during the registration process.
Which is the cheapest free zone in Dubai?
SHAMS offers license packages starting at AED 5,500, making it one of the most affordable options.
How Raes Associates Can Help You
Managing the difficulties of business setup in Dubai can be difficult without proper help. With years of experience, Raes Associates offers a smooth setup procedure adapted to your company’s demands and budget. Our staff provides end-to-end support to make your entrepreneurial journey in Dubai as smooth as possible, from deciding on the best jurisdiction to handling documentation. Contact Raes Associates today to get started.
