When you are doing your research on the cost of establishing a company in Dubai, you must be comparing the expense of formal business registration as compared to the amount of investment you have to make. Dubai has established a reputation as a regional destination that is full of opportunities, but nothing comes at no cost.
Understanding the Cost of Setting Up a Company in Dubai
Whether you choose a free zone, mainland, or offshore business structure, the cost of setting up a company in Dubai hinges on jurisdiction, license type, visa quota, and office requirements.
Free Zone Setup Costs
Free zones are the most budget-friendly option for many international business activities. Based on recent estimates, setting up a company in Dubai in a free zone costs:
- Registration and trademark fees: AED 1,000–2,000, sometimes bundled.
- License fee: ranges from AED 5,750 in certain low-tier zones to AED 20,000 in Dubai free zones.
- Office or flexi-desk: starting at AED 5,500–6,000/year; shared office may cost AED 10,000–15,000.
- Establishment card and admin fees: AED 1,500–2,000.
- Visa charges: AED 3,000–6,000 per visa, depending on the package.
- Overall, many free zone setups on minimal packages cost between AED 12,000 and AED 20,000 for the first year, with higher tiers (e.g., DMCC) reaching AED 30,000–50,000.
- Honest community feedback on Reddit echoes this: one user noted that a full free zone package costs as little as US$5,550 (~ AED 20,400), inclusive of license, visa quota, and address, but excluding medical and Emirates ID. Renewal in year 1 typically AED 16,700.
Mainland Setup Costs
For businesses targeting the local UAE market, a mainland Dubai formation offers market access, but at a higher cost compared to setting up a company in Dubai. Breakdown:
- Trade license (DED): AED 10,000–25,000/year depending on activity.
- Trade name reservation and initial approvals: AED 620–2,000 for name; AED 1,000+ for initial approval.
- Office and Ejari lease: mandatory physical office, with costs ranging from AED 12,000 to 30,000+ for small spaces; prime area offices may exceed AED 50,000.
- MOA drafting and notarization: AED 1,500–5,000.
- Visa and labour cards: AED 3,000–7,000 per visa; establishment card fees ~AED 2,000–3,000
- Optional sponsor fees: AED 5,000–15,000 annually if a local sponsor is necessary.
- Setting up a company in Dubai typically costs between AED 20,000 and AED 70,000+ in the first year, depending on the scope.
Offshore Setup Costs
Offshore companies such as RAK Offshore or JAFZA Offshore are the most economical structure, ideal for asset holding and international trade. Estimated costs:
- Incorporation & agent fees: AED 8,000–15,000
- Annual renewal: AED 3,000–10,000
These entities do not qualify for UAE resident visas or local trade privileges.
Pros of Registering a Business in Dubai
Strategic Location & Market Credibility
Dubai’s global connectivity, robust regulatory infrastructure, and industry-specific hubs, such as the DMCC and DIFC, make it a compelling location. A formal registration offers legitimacy to clients, investors, and partners abroad.
Tax Efficiency & Ownership Flexibility
Free zones grant 100 per cent foreign ownership, permit full profit repatriation, and exempt corporate tax, up to an AED 375,000 profit threshold. Mainland now also allows full ownership in many sectors under recent reforms.
Visa Access & Operational Control
With formal company registration, you gain access to investor and employee visas, opening doors to run operations and hire talent. Mainland companies can issue unlimited visas linked to office space, whereas free zone companies have varying limits depending on their license.
Streamlined Industry-Specific Ecosystems
Certain zones support specific sectors, such as fintech, e-commerce, logistics, or media, and offer tailored infrastructure and networking. The One Freezone Passport initiative now makes cross-zone expansion smoother.
Cons to Consider
Significant Upfront & Renewal Costs
Regardless of the jurisdiction, setting up a company in Dubai entails additional expenses, including license renewals, visa renewals, and PRO or agent fees. Mainland renewals can easily exceed AED 20,000 annually, while free zones may renew in the AED 10,000–20,000 range.
Hidden or Unexpected Fees
Several ancillary fees apply, including medical testing, Emirates ID, audits, bank guarantees, and PRO services. Some free zones require refundable bank deposits. These can add several thousand dirhams after the initial quote.
Limited Trading Privileges in Free Zones
Free zone entities cannot directly trade with the UAE mainland unless using a local distributor. Those seeking local customers may find this limitation restrictive. Mainland setups avoid such constraints but require physical office space and incur higher costs.
Competitive Landscape & Compliance Risks
Dubai’s entrepreneurship scene is saturated in many sectors. New regulations, such as economic substance rules, corporate tax, and VAT, require ongoing compliance. Lack of awareness can result in fines or the suspension or revocation of your license.
Is It Worth It in 2025? Realistic Decision Framework
So, is the cost of setting up a company in Dubai worth it? Let’s break it down by profile.
For Consultancies, Freelancers, Startups Serving Global Markets
A free zone company, costing AED 12,000–20,000 in its first year, is a smart way to access a formal base, receive visas, and conduct business outside the UAE. Many digital nomads and service providers favour IFZA, Meydan, or Sharjah’s SPC.
SPC stands out with a year-one setup of around AED 17,700 for license and two visas, with renewal at AED 5,750/year. Meydan’s similar model costs approximately AED 28,200 in year one, with higher renewals.
For Businesses with Local UAE Clients or Government Contracts
Mainland setup offers full access, unlimited visa scale and credibility in tenders or retail. Please expect setup costs in the range of AED 20,000–70,000. If you don’t need local trade, these costs may not be justified.
For Holding Companies or International Trade Structures
Offshore is best when you don’t need a physical office or local visas. With setup costs as low as AED 8,000 – 15,000 and minimal overhead, it can be an efficient and strategic approach.
Smart Tips to Keep Costs Manageable
- Select the free zone that best suits your visa and activity requirements; some, such as IFZA or SPC, offer significantly lower costs.
- Opt for flexible office solutions, such as flexi-desks, to avoid paying for unused workspace.
- Bundle license, visa, and office fees to access reduced pricing and avoid piecemeal consulting charges.
- Plan your renewal cycle proactively. Late fees or changes in service providers may add unexpected costs.
- Work with an experienced setup partner to minimise hidden fees and compliance issues.
Final Thoughts
Ultimately, the cost of setting up a company in Dubai is not trivial, but for entrepreneurs focused on growth, free zone options offer a pragmatic and tax-efficient platform at a reasonable cost. A mainland license requires a more substantial investment but offers unparalleled access and legitimacy for UAE-based operations.
If your business model relies on international clients or digital delivery, a free zone setup for under AED 20,000 can be a powerful launchpad. If you plan to serve UAE-based consumers, take on contracts, or employ multiple staff locally, the mainland offers superior flexibility and capability, albeit at a higher price tag.
Curious to explore tailored figures for your visa count, activity type, or zone alternatives? We’re happy to build a customised cost estimate and recommend an optimal setup path for your goals.