Starting a business in Dubai offers unmatched access to global markets, tax advantages, and a dynamic business environment. But before setting up, you need a clear understanding of the Company Formation Cost in Dubai—whether in the mainland or within one of its free zones.
This guide walks you through every cost component, jurisdiction-specific pricing, and budgeting tips to help you build a smart financial foundation.
Understanding Dubai’s Business Jurisdictions
Before discussing actual costs, it’s essential to grasp the two primary business environments in Dubai:
Mainland Dubai
Companies licensed by the Department of Economic Development (DED). These businesses have full access to the UAE market and can open offices anywhere in the country.
Free Zones
These are dedicated areas offering 100% foreign ownership, tax exemptions, and fast-track processes. However, free zone businesses can’t trade directly in the mainland without a local agent or distributor.
Company Formation Cost in Dubai Mainland: Breakdown of Expenses
Starting a company in the Dubai mainland involves several key expenses. These include license fees, local sponsorship charges, office rent, visa processing, and admin costs. Your total setup cost depends on your business activity, location, and size. Planning each expense carefully helps avoid delays and ensures a smoother business launch.
Initial License Fees
- Commercial license: AED 10,000–15,000
- Professional license: AED 15,000–20,000
- Industrial license: AED 15,000–25,000
Local Sponsorship Fees
- Annual cost: AED 15,000–50,000
Factors that influence cost: - Business activity
- Company structure
- Annual turnover
Office Space Requirements
- Premium areas (DIFC, Downtown): AED 100–200/sq.ft
- Mid-range zones (Business Bay): AED 70–120/sq.ft
- Budget areas (Deira): AED 40–80/sq.ft
Administrative Costs
- Name reservation: AED 200–600
- Initial approval: AED 100–300
- MOA notarization: 0.25% of share capital (min AED 500)
- Chamber of Commerce: AED 1,000–2,500
- Establishment card: AED 600–1,200
Visa Allocation and Processing
- Entry permit: AED 500–700
- Change of status: AED 650–750
- Medical test: AED 300–500
- Emirates ID: AED 300–370
- Visa stamping: AED 500–700
Other Mandatory Fees
- Trade name: AED 1,000–2,000
- Signboard approval: AED 300–3,000
- Ejari (tenancy contract registration): AED 220
Free Zone Company Formation Cost in Dubai: Full Breakdown
Each free zone has its own authority and fee structure. Below is a detailed comparison:
DMCC
- License: AED 20,000–50,000
- Registration: AED 10,000–15,000
- Office: AED 15,000–30,000+
Dubai Silicon Oasis (DSO)
- License: AED 12,000–25,000
- Registration: AED 3,500–5,000
- Office: AED 22,000–50,000+
Dubai South
- License: AED 15,000–30,000
- Registration: AED 5,000–10,000
- Office: AED 15,000–40,000
Jebel Ali Free Zone (JAFZA)
- License: AED 17,500–35,000
- Registration: AED 5,000–10,000
- Facility: AED 20,000–60,000+
Dubai Internet/Media City
- License: AED 15,000–30,000
- Registration: AED 7,500–12,500
- Office: AED 25,000–90,000+
Workspace Options in Free Zones
Free zones in Dubai offer flexible workspace options for every budget. You can start small with a flexi-desk, upgrade to a fixed desk, or rent a private office as your team grows. Each option affects your visa quota and overhead, so choose based on your needs, not just the price.
Flexi Desk
- Shared workspace
- Cost: AED 15,000–25,000
- Visa quota: 1–3
Fixed Desk
- Dedicated desk
- Cost: AED 25,000–35,000
- Visa quota: 2–5
Small Office
- Cost: AED 35,000–100,000+
- Visa quota: Based on office size (approx. 1 visa per 9 sq.m)
Additional Free Zone Visa Expenses
- Entry permit: AED 500–700
- Status change: AED 650–750
- Medical test: AED 300–500
- Emirates ID: AED 300–370
- Visa stamping: AED 500–700
Mainland vs. Free Zone: Cost Comparisons
| Factor | Mainland | Free Zone |
| Setup Cost | Higher (due to sponsorship) | More predictable |
| Market Access | Full UAE access | Limited without agent |
| Renewal Cost | License + sponsor fees | Often bundled |
| Workspace | Physical office required | Flexible options |
Hidden Costs to Watch For
Many entrepreneurs overlook hidden costs like bank account fees, annual audits, document attestations, or office fit-outs. Even small things like signboard approval or visa deposits can add up quickly. It’s important to plan ahead and include these extras in your budget to avoid surprises later during your Dubai company setup.
Banking
- Account setup: AED 500–3,000
- Minimum deposit: AED 10,000–50,000
Compliance
- Audit: AED 5,000–15,000
- VAT services: AED 2,000–10,000
- Certifications: Depends on industry
Insurance
- Employee coverage: AED 500–1,500
- Liability: Starting at AED 2,500
Marketing
- Website: AED 5,000–30,000
- Branding: AED 5,000–20,000
Smart Ways to Save on Company Formation
Starting smart means spending smart. You can cut costs by choosing the right jurisdiction, starting with a flexi-desk instead of a full office, or applying during promotional periods. Bundled packages and expert consultants also help avoid mistakes, saving you time and money during the business setup process in Dubai.
Choose the Right Jurisdiction
Match your activity to the most cost-effective location.
Scale Gradually
Start with minimal visas or shared workspaces.
Watch for Promotions
Many free zones offer seasonal discounts or bundled packages.
Sector-Specific Cost Considerations
Different industries in Dubai face different startup costs. For example, a tech startup may only need a flexi-desk, while a retail or manufacturing company might need warehousing, licenses, and product registrations. Understanding your industry’s specific requirements helps you plan your budget more accurately and avoid unexpected expenses during setup.
E-Commerce
- Minimal office space
- May need digital certifications
Manufacturing
- Higher warehouse/factory setup
- Environmental compliance
Professional Services
- Fewer permits
- Professional license costs may apply
Retail/Trading
- Storage space required
- Product registration and customs
Step-by-Step Budgeting Guide
- Define your business goals and activity
- Choose jurisdiction and compare packages
- List every setup and operational cost
- Include a 15–20% contingency fund
- Seek expert support for compliance and paperwork
Recent Regulatory Cost Updates
- Relaxed capital rules
- More 100% ownership options
- Lower admin costs
- Multi-year license validity (cost savings)
- Competition among free zones drives better pricing
Conclusion
Understanding the Company Formation Cost in Dubai—whether in the mainland or a free zone—is vital to planning and launching your business successfully. While free zones offer attractive entry points for global traders and SMEs, mainland licenses provide unrestricted local access for high-growth potential.
To make the right decision, analyze your business model, expected market, and long-term goals—and align your setup accordingly.
For expert guidance tailored to your budget and activity, speak to a trusted consultant in Business Setup Cost in Dubai today.
FAQs
What is the minimum capital required to start a company in Dubai?
Most activities have no minimum capital requirement today, but regulated sectors may still require capital proof.
How much is a Dubai mainland trade license?
It ranges from AED 10,000 to AED 15,000, depending on activity type.
Can local sponsor fees be negotiated?
Yes. Fees can range widely and are based on activity, projected revenue, and sponsor involvement.
Which is the cheapest free zone in Dubai?
Zones like IFZA, RAK ICC, and SHAMS offer entry packages starting at AED 15,000–20,000 for service businesses.
Are there hidden costs?
Yes. Budget for bank setup fees, audit requirements, VAT services, and office fit-outs.
