Dubai is one of the most popular cities in the world to set up business, for very good reason. Low taxation, high quality of life and world-class infrastructure are just a few of the reasons so many entrepreneurs choose Dubai as the launchpad to scale and succeed. So, what’s the catch? Can you really boost the bottom line here, or does it come at a hidden cost?
How much money is required to start a business in Dubai?
As a ballpark figure, starting a business in Dubai typically ranges from AED 12,000 to AED 50,000+, depending on a wide range of factors. The key components that will require upfront capital investment are:
- Trade license fees: Licenses are a legal requirement, but the cost varies depending on the business activity, legal structure and whether it’s a Free Zone or Mainland business. There are six types of licenses, though the most common are Commercial, Professional and Industrial licenses. Licenses tend to range from AED 8,000 to AED 15,000
- Visa and immigration costs: Anyone who operates a business in Dubai, regardless of whether it is in a Free Zone or on the Mainland, will need to ensure they (and any employees or dependents) have the right to live in the country. Costs vary from AED 3,000 to over AED 7,000. This encompasses the visa application, Emirates ID, medical test and a change of status if required.
- Office or workspace rental: Mainland businesses typically require a physical office to register a business, but free zones offer flexi-desk, co-working and even virtual spaces to keep the costs down. Costs range from AED 4,000 to AED 50,000+ per year, depending on the space.
- Initial approvals and government fees: There are other administrative costs to consider in addition to licensing, such as trade name reservations, notarization of documents and other legal fees. Costs may range from AED 1,000 to over AED 5,000 depending on the requirements.
Factors that influence the total cost
Overall, launching a business in Dubai – particularly those launching startups in free zones – has much lower startup costs than those associated with other major cities across the globe. However, it’s important to take into consideration a wide range of factors, as the costs associated with these vary wildly. We’ve summarised some key considerations below, but for a more accurate understanding of how much it will cost to launch your unique business in the UAE, we recommend getting in touch with a reputable business setup consultancy like Set Hub, which can help ensure the process is as affordable and seamless as possible.
Mainland vs Free Zone setup
Generally speaking, free zone setups tend to be more cost-effective than mainland businesses. This is because clients can benefit from packages that include key setup costs, such as trade licenses, visas and workspaces. Free zones also allow for 100% foreign ownership, 0% income tax and a quick and easy setup process. Mainland businesses often require largerupfront capital investments due to requirements like mandatory office space, additional government fees and other approvals. However, it’s worth remembering that mainland companies can operate anywhere in the UAE and with the local market, whereas free zones will usually need a local distributor to do so.
Type of license
All businesses need a license to operate legally in the UAE, but licenses vary in price. Professional licenses, usually required for professionals offering consulting or freelance services, tend to be the most affordable as there are fewer requirements for approval. Commercial licenses, used by those engaging in trading activities, are slightly more expensive, though they can incur extra fees for multiple activities or specialist services. Industrial licenses tend to be the most expensive as there are more regulatory requirements.
Number of visas required
Obviously, the more visas you require, the more expensive the set-up costs. Each visa adds government processing fees and also requires medical testing, Emirates ID costs, and more. If you’re planning to hire multiple employees, this will significantly increase your startup costs.
Physical office vs virtual office or Flexi Desk
If you’re looking to reduce costs, this is a good place to save. Many free zones offer flexi desks and virtual office options that reduce costs significantly. However, this is only an option if you are not planning to open a mainland business, which requires a physical office lease to legally operate.
Low-cost business setup options in Dubai
So, where can savvy entrepreneurs save money at the beginning of their journey? Below, we’ve highlighted several affordable solutions and budget-friendly business setup routes designed to help smaller businesses. For expert insights into more budget-friendly and affordable options, feel free to get in touch with our expert team of advisors at Set Hub, who will be happy to help.
Free zone setup
Free zones offer some of the most affordable and flexible setup options for new businesses, as there is minimal overhead. Entrepreneurs can also benefit from quick setup (sometimes within a few days), full repatriation of profits and capital, and 100% foreign ownership. It’s an ideal option for those working in e-commerce, consulting, design, marketing and tech businesses, but don’t discount just because you’re working in industries such as construction or logistics, as there are dedicated free zones designed to help streamline processes and boost the bottom line.
Zero or virtual office space options
Many free zones allow businesses to register without renting a physical office space. Instead, business owners can choose a cost-effective flexi desk or virtual office package, with shared facilities and access to meeting rooms on an as-needed, rather than permanent, basis. This is a particularly good option for those working online or in service-based businesses.
Single-owner licenses
These are a cost-effective and simple business setup option that allow one person to fully own and operate a business in both Mainland and Free Zones. It means business owners can benefit from lower setup costs, no requirements for multiple shareholders and few visas. It’s easy to scale later too.
Why work with Set Hub?
Set Hub makes business setup in Dubai more affordable by combining transparency, expertise and a commitment to client success. We have served over 25,000 clients in the past decade and have become a trusted name in the UAE’sbusiness landscape. With our clear, zero-hidden-fees approach, you can benefit from personalised, cost-effective solutions that match your business goals.
Our team of over 80 professionals speak over 23 languages too, enabling us to support clients from diverse backgrounds all over the world. From choosing the right license to handling visas, banking, and compliance, Set Hub simplifies every step of the process, helping entrepreneurs focus on growth.
If you’re looking for a reliable and affordable way to start your business in Dubai, get in touch today to find out how we can help.
