Business Setup in Dubai Cost Breakdown: What Investors Should Expect

Understanding the cost of setting up a business in Dubai is one of the most important steps for any investor planning to enter the UAE market. Dubai’s global reputation as a business hub, strategic location, tax-friendly environment, and strong infrastructure make it a magnet for entrepreneurs worldwide.

However, the total setup cost depends on several factors, including the type of business license, mainland vs free zone location, business activity, and government approvals. Knowing these costs upfront helps investors plan smarter and avoid unexpected expenses.

What Determines Business Setup Costs in Dubai?

The cost of starting a business varies based on multiple elements. The main factors include:

Mainland vs Free Zone vs Offshore

Each jurisdiction has different fee structures, visa quotas, office requirements, and approval processes.

Business Activity Type

Some activities require special approvals (tourism, real estate, food trading, healthcare), increasing the cost.

Number of Shareholders

More shareholders may require additional legal documentation and approvals.

Visa Requirements

Investor visas, employee visas, visa quotas, and immigration fees affect the total cost.

Office Space Needs

Flexi desks are cheaper; physical offices increase budget.

Government Approvals

DED, Municipality, RERA, DHA, KHDA, Food Safety, Civil Defense — approvals vary according to activity.

Cost Breakdown for Mainland Business Setup in Dubai

Mainland businesses operate under the Department of Economy and Tourism (DED) and incur several government-related charges.

Trade License Fees

Costs vary based on the license category:

• Commercial License

• Professional License

• Industrial License

Typical range: AED 10,000 – AED 20,000 (before additional services)

Initial Approval Fees

DED charges for granting initial business approval.
Range: AED 120 – AED 300

Trade Name Registration Fees

Includes reservation and approval fees.
Range: AED 700 – AED 800
Premium names cost higher.

Office Space / Ejari Costs

Mainland licenses require either:

• Physical office (AED 20,000 – AED 50,000/year depending on size & location)

• Flexi desk options (AED 4,000 – AED 10,000/year)

Ejari registration is mandatory for physical offices.

MOA / LSA Agreement Costs

Depending on business structure:

• Memorandum of Association (MOA)

• Local Service Agent (LSA) agreement for professional licenses

Notarization and drafting: AED 1,500 – AED 3,000

Additional Government Fees

• Dubai Chamber of Commerce registration

• Municipality fees

• Administrative fees

Total additional charges: AED 2,000 – AED 4,000

Estimated Total Mainland Setup Cost

For 2025, typical mainland setup cost ranges from:
AED 15,000 – AED 35,000
(Excluding office rent and visa charges)

Cost Breakdown for Free Zone Business Setup in Dubai

Free zones offer attractive pricing and simplified setup options for foreign investors.

License Package Fees

Packages vary depending on activity:

• Trading

• Service

• Consultancy

• E-commerce

• Media

• Tech

Typical license packages: AED 8,000 – AED 18,500 (depending on free zone)

Office / Flexi Desk Solutions

Many free zones offer:

• Flexi desks

• Co-working spaces

• Private offices

Cost: AED 4,000 – AED 15,000 annually

Visa Quota Charges

Free zones provide 0–6 visa quotas based on package.
Additional visas may increase the cost.

Establishment Card Fees

Required for issuing visas in free zones.
Cost: AED 500 – AED 2,000

Total Estimated Free Zone Cost

Estimated cost for 2025 varies by free zone:

• IFZA: AED 12,500 – AED 18,000

• Meydan: AED 14,000 – AED 22,000

• DMCC: AED 35,000 – AED 60,000

• SPC Free Zone: AED 8,500 – AED 15,000

Additional Costs Investors Should Consider

Beyond the license and registration fees, several related expenses apply:

Visa Fees

For investors and employees:
AED 3,500 – AED 5,000 per visa

Medical Test & Emirates ID

AED 1,100 – AED 1,500 per person

Immigration Card

Mainland: AED 700 – AED 1,000
Free zone: Included or around AED 500

Bank Account Opening

Some banks require a minimum balance of AED 5,000 – AED 50,000.

Insurance, Accounting & PRO Services

Annual operating costs vary based on business nature.

Hidden Costs Many Investors Miss

Some fees are activity-based or situational. These often surprise investors:

Activity-Specific Approvals

• Food business: Food Safety Department

• Real estate: RERA approvals

• Tourism: DTCM approvals

• Education: KHDA approvals
  Cost may range from AED 2,000 – AED 20,000

Translation & Attestation Fees

Legal documents may need translation or attestation:
AED 100 – AED 500+ per document

Annual Renewals

License renewals can cost the same as initial setup.

Office Expansion or Relocation

Ejari transfers and new office approvals add extra costs.

Mainland vs Free Zone: Cost Comparison Table

How Much Does It REALLY Cost to Start a Business in Dubai?

Here’s what investors can expect across different budget levels:

Low-Cost Options

Free zone packages starting from AED 8,000 – AED 15,000
(ideal for freelancers, consultants, small traders)

Mid-Range Setups

Free zone corporate packages: AED 15,000 – AED 30,000
Mainland commercial licenses: AED 20,000 – AED 35,000

Premium Business Setups

DMCC, DIFC, and large office spaces: AED 50,000 – AED 100,000+

Example Scenarios

• Freelancer consultant: AED 8,000 – AED 12,000

• Small trading company (free zone): AED 15,000 – AED 25,000

• Mainland LLC: AED 25,000 – AED 50,000

• Luxury real estate brokerage: AED 35,000 – AED 80,000

Tips to Reduce Business Setup Costs in Dubai

• Choose cost-efficient free zones

• Opt for flexi desk or co-working offices

• Pick business activities requiring fewer approvals

• Use bundled setup packages from consultants

• Reserve your trade name early

• Avoid premium or restricted trade names

Smart planning can reduce costs significantly.

Frequently Asked Questions (FAQs)

What is the cheapest way to start a business in Dubai?
Choosing a free zone with low-cost packages, such as SPC or IFZA.

How much is a business license in 2025?
Typically between AED 8,000 – AED 25,000, depending on the zone.

Are there hidden fees investors should expect?
Yes — approvals, translations, office rent, and visa expenses.

Can foreigners start a business without a local sponsor?
Yes. 100% foreign ownership is allowed in both mainland and free zones.

How long do approvals take?
Free zone: 3–7 days
Mainland: 5–15 days, depending on activity.

Conclusion

Understanding the cost breakdown of setting up a business in Dubai helps investors plan their budgets, avoid unexpected charges, and choose the best setup structure for their goals. Dubai offers flexible options for every budget—from affordable free zones to premium business hubs. By evaluating costs based on license type, business activity, and long-term plans, investors can confidently build a strong foundation in the UAE market.