How much does it really cost to set up a business in Dubai? While advertisements claim "AED 5,000 company setup," the reality involves license fees, office space, visas, and numerous compliance costs that push total first-year expenses to AED 30,000-120,000 depending on structure and location. Hidden costs and unexpected fees catch most first-time entrepreneurs off-guard, leading to budget overruns of 40-60% on average.
As Ministry-approved business consultants with 37 years of Dubai experience (having formed over 28,000 companies), we've helped businesses navigate Dubai's complex fee structures. This comprehensive guide provides transparent, itemized cost breakdowns for every license type, location, and business structureso you can budget accurately and avoid the expensive surprises that derail most startup plans.
Understanding Dubai Business Setup Cost Structure
Dubai business setup costs break into five major categories:
1. Government Fees (Non-Negotiable)
What's Included:
- Trade license fee
- Registration fees
- Name reservation
- Initial approval fees
- Immigration card (free zones)
Cost Range: AED 10,000-50,000 (depending on license type, location)
Dubai Context: These are fixed government fees set by Dubai Economic Department (mainland) or specific free zone authorities. No negotiation possible.
2. Office Space (Largest Ongoing Cost)
What's Included:
- Physical office rent or flexi-desk
- Ejari registration (mainland)
- Office setup/furnishing
- Utilities deposits
Cost Range: AED 10,000-150,000 annually
Critical: Every UAE company must have physical office space. No exceptions. "Virtual offices" aren't legally recognized for license purposes.
3. Visa & Immigration Costs
What's Included:
- Visa processing fees
- Medical fitness tests
- Emirates ID fees
- Typing center charges
- Entry permits
Cost Range: AED 5,000-10,000 per person
4. Professional Services
What's Included:
- PRO (Public Relations Officer) services
- Document preparation
- Government liaison
- Consultancy fees
- Legal documentation (notarization)
Cost Range: AED 5,000-20,000 (one-time)
5. Post-Setup Compliance
What's Included:
- Corporate bank account opening
- Accounting software
- VAT/Corporate tax registration
- Initial accounting setup
Cost Range: AED 5,000-15,000 (one-time)
Mainland Business Setup Costs (DED)
Commercial License (Trading)
Government Fees:
- Name reservation: AED 620
- Initial approval: AED 1,200
- Trade license (commercial): AED 18,000-30,000
- Chamber of Commerce membership: AED 2,500
- Subtotal Government: AED 22,320-34,320
Office Space (Annual):
- Business center flexi-desk: AED 15,000-35,000
- Small office (100-200 sq ft): AED 30,000-70,000
- Medium office (200-500 sq ft): AED 50,000-120,000
- Ejari registration: AED 220
- Subtotal Office: AED 15,220-120,220
Legal & Documentation:
- MOA drafting & notarization: AED 4,000-7,000
- Typing center services: AED 800-1,500
- Subtotal Legal: AED 4,800-8,500
Visa (per person):
- Medical fitness test: AED 350-500
- Emirates ID (3 years): AED 770
- Visa processing: AED 4,000-6,000
- Typing services: AED 600-1,000
- Subtotal Visa (1 person): AED 5,720-8,270
Professional Services:
- PRO services (formation): AED 8,000-15,000
- Bank account opening support: AED 2,000-5,000
- Subtotal Professional: AED 10,000-20,000
TOTAL YEAR 1 (Commercial License, 1 Shareholder):
- Minimum (flexi-desk): AED 58,060
- Realistic (small office): AED 85,000-100,000
- Premium (medium office): AED 110,000-150,000
YEAR 2+ RECURRING COSTS:
- License renewal: AED 18,000-30,000
- Office rent: AED 15,000-120,000
- Visa renewal: AED 5,720-8,270
- Annual Total: AED 38,720-158,270
Professional License (Consultancy/Services)
Government Fees:
- Name reservation: AED 620
- Initial approval: AED 1,500
- Trade license (professional): AED 15,000-25,000
- Chamber membership: AED 2,000
- Subtotal Government: AED 19,120-29,120
Office Space:
- Same as commercial (AED 15,220-120,220)
Legal & Documentation:
- MOA drafting: AED 4,000-7,000
- Professional qualifications attestation: AED 1,000-3,000
- Subtotal Legal: AED 5,000-10,000
Visas & Professional Services:
- Same as commercial (AED 15,720-28,270)
TOTAL YEAR 1 (Professional License):
- Minimum: AED 55,060-67,610
- Realistic: AED 75,000-95,000
- Premium: AED 100,000-140,000
Key Difference from Commercial:
- Lower license fees
- Professional qualifications required (degrees, experience certificates)
- May need qualified partner in some professions (legal, medical)
Industrial License (Manufacturing)
Government Fees:
- Name reservation: AED 620
- Initial approval: AED 2,000-5,000
- Trade license (industrial): AED 25,000-45,000
- Chamber membership: AED 3,000
- Dubai Municipality approval: AED 2,000-10,000
- Civil Defense approval: AED 1,000-5,000
- Subtotal Government: AED 33,620-68,620
Facility Space:
- Industrial warehouse (minimum 500 sq ft): AED 60,000-150,000/year
- Ejari registration: AED 220
- Facility modifications/compliance: AED 10,000-50,000 (one-time)
- Subtotal Facility: AED 70,220-200,220
Machinery & Equipment:
- Depends entirely on manufacturing type
- Budget: AED 50,000-500,000+
Total Industrial Setup:
- AED 150,000-350,000+ (highly variable)
Note: Industrial licenses are most expensive due to facility requirements, safety compliance, and equipment needs.
Free Zone Business Setup Costs
Free zone costs vary significantly by zone. Here's a breakdown of major free zones:
DMCC (Dubai Multi Commodities Centre)
Most Popular Free Zone - Premium Pricing
License Fees:
- Company registration: AED 10,000-15,000
- License fee (single activity): AED 12,500
- License fee (multiple activities): AED 18,000
- Immigration card: AED 3,500
- Subtotal License: AED 26,000-36,500
Office Space (Annual):
- Flexi-desk: AED 20,000-30,000
- Small office (150 sq ft): AED 45,000-65,000
- Medium office (300 sq ft): AED 80,000-120,000
- Subtotal Office: AED 20,000-120,000
Visa Package (per person):
- All-inclusive visa: AED 7,500-9,000
- Includes: Medical, Emirates ID, visa stamping
Share Capital:
- Minimum: AED 50,000 (must be deposited)
- Can be used for operations after deposit
TOTAL YEAR 1 (DMCC, 1 Shareholder):
- Minimum (flexi-desk): AED 53,500-75,500
- Realistic (small office): AED 85,000-110,000
- Premium (medium office): AED 135,000-170,000
Plus: AED 50,000 share capital (refundable/usable)
Dubai Silicon Oasis (DSO)
Best for Startups/Tech - Lower Cost
License Fees:
- Company registration: AED 5,000
- License fee: AED 8,500-12,000
- Immigration card: AED 2,000
- Subtotal License: AED 15,500-19,000
Office Space (Annual):
- Flexi-desk: AED 12,000-18,000
- Small office: AED 25,000-40,000
- Medium office: AED 45,000-75,000
Visa Package:
- All-inclusive: AED 6,000-7,500
TOTAL YEAR 1 (DSO, 1 Shareholder):
- Minimum: AED 33,500-44,500
- Realistic: AED 50,000-70,000
- Premium: AED 75,000-100,000
Advantage: ~40% cheaper than DMCC while offering similar benefits
DIFC (Dubai International Financial Centre)
Financial Services Focus - Highest Cost
License Fees:
- Company registration: AED 31,000
- DFSA authorization (if regulated): AED 75,000-200,000
- Annual operating fee: AED 10,000-50,000
- Subtotal License: AED 116,000-281,000
Office Space:
- Minimum requirement (regulated firms): AED 80,000-150,000/year
Professional Requirements:
- Compliance officer salary: AED 180,000-300,000/year
- Regulatory consultancy: AED 50,000-150,000
TOTAL YEAR 1 (DIFC Financial Services):
- AED 350,000-750,000+ (for regulated financial firms)
Note: DIFC is expensive but provides common law jurisdiction and global credibility for financial services.
JAFZA (Jebel Ali Free Zone)
Manufacturing/Logistics - Variable Costs
License Fees:
- Registration: AED 8,500
- License fee: AED 10,000-15,000
- Immigration card: AED 3,000
Facility Space:
- Office (small): AED 20,000-35,000/year
- Warehouse (500 sq m): AED 80,000-150,000/year
- Land plot (for manufacturing): AED 150,000-500,000/year
TOTAL YEAR 1:
- Office-based: AED 40,000-60,000
- Warehouse operation: AED 100,000-180,000
- Manufacturing facility: AED 200,000-550,000+
Dubai CommerCity
E-Commerce Focus - Competitive Pricing
License Fees:
- Registration: AED 7,500
- License fee: AED 9,500-14,000
- Immigration card: AED 2,500
Office/Warehouse:
- Flexi-desk: AED 15,000-22,000
- Small warehouse: AED 35,000-55,000
- Medium warehouse: AED 60,000-95,000
TOTAL YEAR 1:
- Flexi-desk: AED 34,500-48,500
- Warehouse setup: AED 60,000-95,000
Advantage: E-commerce specific services, logistics support included
Cost Comparison: Mainland vs Free Zones
Budget Analysis (Single Shareholder, Year 1)
Scroll to see all columns →
| Setup Type | Minimum | Realistic | Premium |
|---|---|---|---|
| Mainland (Commercial) | AED 58,000 | AED 85,000-100,000 | AED 110,000-150,000 |
| DMCC (Free Zone) | AED 54,000 | AED 85,000-110,000 | AED 135,000-170,000 |
| DSO (Free Zone) | AED 34,000 | AED 50,000-70,000 | AED 75,000-100,000 |
| JAFZA (Warehouse) | AED 100,000 | AED 120,000-160,000 | AED 200,000-300,000 |
| DIFC (Financial) | AED 350,000 | AED 500,000-600,000 | AED 750,000+ |
Key Insights:
- Cheapest option: Dubai Silicon Oasis free zone (AED 33,500-44,500)
- Most expensive: DIFC for regulated financial services (AED 350,000+)
- Mainland vs DMCC: Similar total costs but different benefits
- Free zones: 20-50% cheaper than mainland initially
Hidden Costs & Unexpected Fees
Based on 37 years forming 28,000+ companies, these are the costs that surprise entrepreneurs:
1. Bank Account Minimum Deposits
What: Banks require initial deposits to open corporate accounts
Cost:
- Local UAE banks: AED 5,000-25,000
- International banks (HSBC, Citi): AED 50,000-100,000
- Islamic banks: AED 10,000-25,000
Impact: Ties up capital for 3-6 months minimum
Dubai Context: This isn't a "fee" but impacts cash flow significantly
2. Office Furnishing & Setup
What: Ejari-registered offices often come unfurnished
Cost:
- Basic furnishing (desk, chairs): AED 5,000-15,000
- Full office setup (meeting room, etc.): AED 20,000-50,000
- IT infrastructure: AED 3,000-10,000
Flexi-desks include: Furniture, internet, utilities (better value)
3. Attestation & Translation Fees
What: Foreign documents require UAE legalization
Cost per document:
- UAE embassy attestation (in home country): AED 200-800
- Ministry of Foreign Affairs (UAE): AED 150-300
- Arabic translation: AED 100-500 per page
- Notarization: AED 200-500 per document
Total for typical setup: AED 2,000-5,000
Most affected: Educational certificates, POAs, foreign incorporation documents
4. External Approvals
What: Certain activities require regulatory authority approvals
Costs:
- Dubai Municipality (food): AED 2,000-10,000
- Dubai Health Authority (medical): AED 5,000-25,000
- KHDA (education): AED 10,000-50,000
- Dubai Police (security): AED 3,000-8,000
- DTCM (tourism): AED 5,000-15,000
Timeline impact: 14-45 days additional processing
5. Compliance Software & Systems
What: Modern businesses need digital infrastructure
Costs:
- Accounting software (annual): AED 3,000-12,000
- HR/Payroll system: AED 2,000-8,000/year
- CRM system: AED 2,000-15,000/year
- VAT compliance software: AED 1,500-5,000/year
Total annual tech stack: AED 8,000-40,000
6. Annual Audit Requirements
What: Mainland companies require audited financial statements
Cost (depending on company size):
- Small company (<AED 5M revenue): AED 5,000-12,000
- Medium company (AED 5-50M): AED 12,000-30,000
- Large company (>AED 50M): AED 30,000-100,000+
Free zones: Many don't require audit (cost saving)
Related: External Audit Requirements UAE
7. Visa Quota Expansion
What: Need more visas as you hire? Must upgrade office.
Cost:
- Office size upgrade: AED 15,000-50,000/year additional rent
- License amendment: AED 3,000-5,000
- New visa processing: AED 5,000-8,000 per employee
Example: Small office (2-4 visas) → Medium office (5-10 visas) = AED 20,000-40,000 additional cost
Cost Optimization Strategies
Strategy 1: Flexi-Desk for Year 1
Instead of: Dedicated office (AED 30,000-70,000) Choose: Business center flexi-desk (AED 12,000-25,000) Savings: AED 18,000-45,000
When it works:
- Solo entrepreneur or 2-person team
- Client meetings off-site
- Remote/digital business model
When it doesn't:
- Need meeting rooms frequently
- Client-facing business requiring professional space
- Plan to hire 5+ staff within 12 months
Strategy 2: Start with Single Activity License
Instead of: Multi-activity license (AED 20,000-30,000) Choose: Single activity (AED 12,000-18,000) Savings: AED 8,000-12,000 initially
Add activities later when revenue justifies (AED 3,000-5,000 per activity)
Strategy 3: Free Zone vs Mainland for Startups
If your business:
- Primarily exports/international
- Online/digital services
- No mainland UAE customers initially
Choose: Lower-cost free zone (DSO, CommerCity) Savings: AED 20,000-50,000 vs mainland
Form mainland later when scaling requires it
Strategy 4: Delay Family Visas
Instead of: Sponsoring family immediately (AED 15,000-30,000) Choose: Delay 6-12 months until business stable Cash flow benefit: AED 15,000-30,000 preserved for operations
Consideration: Family remains in home country temporarily
Strategy 5: Use Pre-Approved Business Centers
Instead of: Individual office + Ejari hassle Choose: Pre-approved business center Benefits:
- Faster processing (no Ejari delays)
- All-inclusive pricing (utilities, internet)
- Flexibility (upgrade/downgrade easily)
Complete Budget Planning Template
Startup Budget (Mainland, 1 Shareholder)
One-Time Costs:
- Government fees (license, approvals): AED 22,000-35,000
- Legal & documentation: AED 5,000-10,000
- Office setup (deposit, furnishing): AED 5,000-20,000
- Visa processing: AED 6,000-9,000
- Professional services (PRO, consultancy): AED 10,000-20,000
- Bank account opening: AED 2,000-5,000
- One-Time Total: AED 50,000-99,000
Annual Recurring:
- Office rent: AED 15,000-70,000
- License renewal: AED 18,000-30,000
- Visa renewals: AED 6,000-9,000
- Accounting/audit: AED 12,000-30,000
- Software/systems: AED 8,000-20,000
- PRO services (ongoing): AED 6,000-15,000
- Annual Recurring: AED 65,000-174,000
Total Year 1: AED 115,000-273,000 Total Year 2+: AED 65,000-174,000
Cash Flow Considerations
Month 1-2 (Formation):
- Pay: Government fees, professional services
- Cash out: AED 40,000-70,000
Month 2-3 (Office & Visas):
- Pay: Office deposit (2-3 months rent), visa fees
- Cash out: AED 35,000-80,000
Month 4+ (Operations):
- Monthly burn: AED 5,000-15,000 (rent, utilities, software)
Recommended cash reserve: 6 months operating costs = AED 50,000-120,000
Industry-Specific Cost Analysis
E-Commerce Business
Optimal Setup: Dubai CommerCity Free Zone
Year 1 Costs:
- License & registration: AED 20,000
- Flexi-desk: AED 18,000
- Visa (1 person): AED 7,000
- Professional services: AED 8,000
- E-commerce platform: AED 5,000-15,000
- Total: AED 58,000-68,000
Advantage: Logistics support, lower costs, e-commerce focus
Professional Consultancy
Optimal Setup: Mainland Professional License
Year 1 Costs:
- License & fees: AED 25,000-35,000
- Flexi-desk: AED 15,000-25,000
- Visa: AED 7,000
- Professional services: AED 10,000
- Total: AED 57,000-77,000
Advantage: Can work anywhere in UAE, government contracts eligible
Trading Company (Import/Export)
Optimal Setup: DMCC or JAFZA (depending on scale)
DMCC (small-scale trading):
- Year 1: AED 75,000-110,000
- Advantage: Prestigious address, easier banking
JAFZA (large-scale, warehousing):
- Year 1: AED 120,000-200,000
- Advantage: Port proximity, lower warehouse costs
Tech Startup
Optimal Setup: Dubai Silicon Oasis
Year 1 Costs:
- License & registration: AED 18,000
- Flexi-desk: AED 15,000
- Visas (2 founders): AED 14,000
- Professional services: AED 8,000
- Tech infrastructure: AED 10,000-20,000
- Total: AED 65,000-75,000
Advantage: Tech ecosystem, startup support, 40% cheaper than DMCC
Mistakes That Increase Costs by 40-60%
Mistake 1: Underestimating Office Space Needs
What happens: Rent smallest office to save money, hit visa quota limit in 6 months
Cost impact:
- Office upgrade: AED 20,000-40,000 additional/year
- License amendment: AED 3,000-5,000
- Moving costs: AED 5,000-10,000
- Total waste: AED 28,000-55,000
Solution: Project hiring for 18-24 months, size office accordingly
Mistake 2: Wrong Free Zone Selection
What happens: Choose cheapest free zone, then discover can't do intended activity
Example: Form in DSO for trading, discover DSO focuses on tech (trading less supported)
Cost impact:
- Close first company: AED 5,000-10,000
- Form new company: AED 30,000-60,000
- Total waste: AED 35,000-70,000
Solution: Match free zone to business activity (use our comparison guide)
Mistake 3: Skipping Professional Consultancy
What happens: DIY to save AED 10,000-15,000 consultant fee
Common errors:
- Wrong business activity selection (AED 5,000 to fix)
- Insufficient visa quota (AED 8,000-15,000 upgrade)
- Missing external approvals (14-30 day delays + fees)
- Banking documentation issues (21-45 day delays)
Total cost of DIY mistakes: AED 20,000-50,000 + 30-60 day delays
ROI of professional help: AED 10,000-15,000 investment saves AED 20,000-50,000
Mistake 4: Inadequate Cash Reserve
What happens: Budget only formation costs, run out of cash at month 4
Reality check:
- Month 1-3: Company formation (no revenue)
- Month 4-6: Ramp-up (minimal revenue)
- Break-even: Month 6-12 (for most startups)
Required cash: Formation costs + 6 months burn rate
Example:
- Formation: AED 60,000
- Monthly burn: AED 12,000
- Total needed: AED 132,000 (not just AED 60,000)
How to Reduce Total Costs by 30-40%
Cost Reduction Checklist
** Choose right free zone** (DSO vs DMCC: 40% savings) ** Start with flexi-desk** (vs dedicated office: AED 20,000-45,000 savings) ** Single activity initially** (vs multi-activity: AED 8,000-12,000 savings) ** Delay family visas** (6 months: AED 15,000-25,000 cash preserved) ** Use pre-approved centers** (vs individual Ejari: AED 3,000-8,000 savings) ** Hire professional consultant** (saves AED 20,000-50,000 in mistakes)
Total potential savings: AED 60,000-150,000 (30-40% reduction)
Professional Cost Consultation
Our business setup services provide transparent, itemized costing:
Free Cost Analysis: Detailed budget for your specific business Fixed-Fee Packages: No hidden surprises Cost Optimization: Identify 20-40% savings opportunities Payment Plans: Spread costs over formation period All-Inclusive Pricing: Government fees + professional services bundled
Typical packages:
- Mainland Commercial: AED 65,000-85,000 all-in (Year 1)
- Free Zone (DSO/CommerCity): AED 40,000-55,000 all-in
- Free Zone (DMCC): AED 70,000-95,000 all-in
Includes: License, flexi-desk, 1 visa, PRO services, consultancy, bank support
Call: +971 42 500 251 Email: info@auditfirmsdubai.ae Get Quote: https://auditfirmsdubai.ae
Frequently Asked Questions
Q: What's the absolute minimum cost to start a Dubai business?
A: AED 30,000-35,000 for basic free zone setup (DSO or CommerCity):
- License: AED 15,000-18,000
- Flexi-desk (annual): AED 12,000-15,000
- Visa (1 person): AED 6,000-7,000
This is bare minimum. Realistic budget: AED 50,000-60,000 including professional help.
Q: Mainland or free zone - which is cheaper?
A: Free zones typically 20-35% cheaper initially:
- Mainland Year 1: AED 60,000-100,000
- Free Zone (DSO) Year 1: AED 35,000-60,000
But consider ongoing costs and business needs, not just setup cost.
Q: Are there any completely free zones (zero cost)?
A: No. All free zones charge fees. "Free" refers to tax-free and ownership freedoms, not zero-cost setup.
Q: Can I pay in installments?
A: Some free zones offer payment plans:
- DMCC: Split over 2-3 payments
- DSO: Payment plan options available
Mainland (DED): Generally full payment required.
Q: What costs can be reduced to lower budget?
A: Flexible costs:
- Office space (flexi-desk vs dedicated): Save AED 15,000-40,000
- Number of visas (delay family): Save AED 15,000-25,000
- Professional services (DIY vs expert): Save AED 10,000-15,000 (but risk mistakes)
Fixed costs (cannot reduce):
- Government license fees (set by DED/free zones)
- Visa fees (set by immigration)
- Emirates ID fees (government-fixed)
Q: Do costs increase every year?
A: License fees typically stable. Annual increases:
- Office rent: 5-10% increases (Dubai real estate market dependent)
- Visa fees: Rarely change (stable)
- New costs: Corporate tax compliance (from Year 2023+)
Q: What's the most expensive mistake startups make?
A: Wrong business structure (40% of startups, based on our experience):
- Form free zone, then discover need mainland access
- Cost to fix: AED 30,000-70,000 (form second company or relocate)
Prevention: Consult expert before formation (AED 10,000-15,000 investment prevents AED 30,000-70,000 waste).
Your Cost Planning Action Plan
Step 1: Define Your Business Model
- Identify primary activities
- Determine target market (UAE vs international)
- Project hiring needs (12-24 months)
- Estimate revenue timeline
Step 2: Calculate Your Budget
- Government fees for chosen structure: AED _____
- Office space (annual): AED _____
- Visas (number of people × AED 7,000): AED _____
- Professional services: AED _____
- Working capital (6 months): AED _____
- TOTAL REQUIRED: AED _____
Step 3: Identify Cost Optimizations
- Can start with flexi-desk? (Save AED 15,000-40,000)
- Free zone cheaper than mainland for my model?
- Need all activities initially or can add later?
- Must sponsor family immediately or can delay?
Step 4: Get Professional Quote
Contact us for itemized cost breakdown specific to your business:
Call: +971 42 500 251 Email: info@auditfirmsdubai.ae
Free 30-minute consultation to review your specific needs and provide accurate budget.
Related Guides:
Important Disclaimer
The information provided in this article reflects the regulatory environment as of 2026. Laws and regulations in the UAE are subject to change. This content is for general information only and does not constitute professional legal or financial advice. We recommend consulting with a qualified auditor or legal advisor for your specific situation.
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