For a strategic leader, the cost of a Dubai business license isn't an expense- it's your initial CAPEX defining market access, tax liability, and scalability. This breakdown moves beyond brochure prices to model the Total Cost of Ownership (TCO) for a tech venture in Dubai, arming you with the data to optimize your market entry strategy.
Navigating the Financial Terrain: Breaking Down Dubai’s Business Set Up Costs
1. Upfront Costs: Business Set Up Fees in Dubai
Before you get your business rolling, there are some upfront expenses you must be already aware of. These costs depend on the type of business you choose. Whether you are going to set up as a Mainland, Free Zone or Offshore company, these upfront costs will vary. Let's break it down:
Mainland LLC Set Up Costs
- Business License is AED 15,000 - AED 20,000
- Office Space renting AED 5,000 - AED 20,000 depending on the location size.
(Total= AED 25,000 - AED 50,000 + )
Free Zone Company Set Up Costs
- Trade License is AED 8,000 - AED 15,000
- Service Fees (varies from one Free Zone to another) AED 2,000 - AED 10,000
(Total= AED12,000 - AED 40,000 +)
Offshore Company Set Up Costs
- License/Fees, AED 7,000 - AED 12,000
- Registered Agent, AED 3,000 - AED 5,000
(Total = AED 10,000 - AED 18,000 +)
Pro Tip: Set up costs can vary, so it’s always a good idea to get a customized quote from the respective authority or free zone.
2. Visa Costs in Dubai: Getting Your Team Onboard
After you have set up your business, the next step is to bring the talent in. Depending on the size of your company, and the number of employees you plan to bring into your company, Dubai has various visa options.
- Investor Visa: AED 3,000 to 5,000 will cost for the Investor Visa
- Dependent Visa: (for family members) AED 2,000 to 4,000 per family member.
- Golden Visa: (for eligible investors and entrepreneurs) Golden Visa Costs AED 3,000 to 10,000. Know more about it.
Pro Tip: Visa costs can stack up quickly if you’re hiring a lot of staff, so always ensure your office space can accommodate the number of visas you’re planning to apply for.
3. Hidden Costs of Business Set Up in Dubai
This is where it can get a little trickier. Many startup entrepreneurs tend to overlook the extra costs, which if unplanned could lead to delays to your set up, and imagine the stress you may experience while in Dubai.
Office-Related Expenses [Cost Breakdown]:
- Office Security Deposit: AED 5,000 - 15,000 (depends on size and location)
- Furnishings & Equipment: AED 5,000 - 20,000 (depends on type of operation and scale)
- Utility Connection: AED 1,000 - 3,000
Legal and Regulatory [Cost Breakdown]:
- MOA (Memorandum of Association): AED 1,000 to 3,000
- Professional Fees (consultant, advisor etc): AED 2,000 to 10,000
Marketing and Branding [Cost Breakdown]:
- Logo: AED 2,000 to 5,000
- Website Development: AED 3,000 to 10,000
- Digital Marketing: AED 1,000 to 5,000 / month
4. Ongoing Business Costs in Dubai
Once your business is running the day to day expenses that you will incur will accumulate and it is always good to plan and have your eyes on the horizon. The following is a succinct overview of some of the costs you should have in mind when it comes to running your ongoing business.
License Renewal:
- Mainland: AED 15,000 to 30,000 per annum
- Free Zone: AED 8,000 to 25,000 per annum
- Offshore: AED 6,000 to 12,000 per annum
Salaries: The average salary of an experienced employee is likely between AED 5,000 and AED 15,000+ per month, and that will depend on industry and experience.
Office Rent:
- Mainland: AED 5,000 to 20,000 (depends on the size and location).
- Free Zone: AED 5,000 to 12,000
Pro Tip: Dubai's real estate market has great vibrancy, and any long-term office lease may help negotiate a fixed rented asset; however, just be mindful that higher demand areas such as Downtown Dubai can be subject to variable rents.
5. Minimize These Expensive Mistakes
There are a couple of hidden costs that may throw you off if they aren't catered for from the start. You make sure you've got that accounted for.
Regulatory Compliance Costs: VAT Registration: A business must register for VAT when the annual turnover is at AED 375,000 and is AED 500+ to register.
Industry Approvals: Government approvals are required (with a few exceptions in teaching) for example: health care, education, hospitality, and food services. The cost of approvals can be AED 2,000 - AED 10,000 or more depending on the industry.
Audit Fees: Most Mainland Companies will need an audit each year that cost between AED 3,000 - 10,000 per year.
License Penalties: If you fail to renew your business license you will incur a daily penalty of AED 1,000 (make sure you are on level to renew in advance).
Custom Duties or Charges: If your company is trading in goods there can be additional costs depending on whether you are liable for customs duty and taxes or shipping charges from 5% - 10% depending on your products.
6. Smart Budgeting: Prepare for the Unexpected
When incorporating a new business in Dubai always include a contingency budget for unexpected expenses. If you can include an additional 20% to 30% for your quoted prices for setting up a business in Dubai, it makes it better to cope with unexpected surprises without exceeding your budget.
Typical additional costs you may incur include: Additional Permits: The country/ government authorities may require some special permits or approvals based on your activities, again more relevant if you are doing registered activities.
Banking & Financial Services: Once you are set up you will need to get a corporate bank account. you may have account set up fees, credit card fees, transactions fees, and other charges to be mindful of, fees can add up very quickly.
Hiring: If you use a recruitment agency or a head-hunter to find your staff (this will happen) the average cost can be AED 5,000 up to AED 15,000 per employee for even, entry-level positions but it is variable based on the level of task that is being filled (e.g. senior level employees can vary due to their high demand by agencies).
Abrupt Expenses: Have a contingency of up to AED 20,000 for sudden issues, unexpected costs, deposits, if you have any.
Pro Tip: Always have some unknowns in your budget and check with a business set up consultant who can give you some indicators to expect.
7. A Comparative Financial Model
| Cost Category | Mainland LLC (Year 1) | Free Zone Co. (Year 1) | Offshore Co. (Year 1) | Notes |
|---|---|---|---|---|
| Set Up & Licensing | AED 25,000 - 50,000 | AED 12,000 - 40,000 | AED 10,000 - 18,000 | Free Zone costs are zone-dependent |
| Office (Flexi-Desk) | Mandatory Physical | Included / AED 5k | N/A | Mainland Ejari is a key cost driver |
| 2 Investor Visas | ~AED 7,000 | ~AED 7,000 | N/A | Includes medical, IDs, permits |
| Gov't & Professional Fees | AED 3,000 - 10,000 | AED 1,000 - 5,000 | AED 2,000 - 4,000 | MOA, notary, consultant fees |
| Estimated Year 1 TCO | AED 35,000 - 67,000+ | AED 20,000 - 52,000+ | AED 12,000 - 22,000 | |
| Annual Renewal TCO | ~AED 15,000 - 30,000 | ~AED 8,000 - 25,000 | ~AED 6,000 - 12,000 | License, office, visas |
Final Takeaway: Plan Smart, Scale Fast
The cost of setting up a business in Dubai is an investment- not just an expense. With the right budgeting, you can tap into one of the world’s most dynamic markets.
Ready to start? [Book a free consultation] or call +971 52 544 1248 today.
Zubair Sultan Mohammed
CEO - MSZ Corporate Services
Zubair Sultan Mohammed is a seasoned business consultant specializing in company formation and regulatory compliance in the UAE and Saudi Arabia. With over 15 years of experience, he has guided entrepreneurs, SMEs, and multinational firms through the complexities of regional business laws and market entry strategies. His deep understanding of local licensing, taxation, and free zone structures ensures clients make informed, strategic decisions. Zubair Sultan Mohammed regularly contributes insights on corporate setup, investment trends, and regional economic developments.
