For a very long time, Dubai has been in the limelight as a successful business destination, pulling in entrepreneurs from all over the globe due to its low taxes, great infrastructure, and the worldwide connectivity it offers. Now, the prime question on the minds of every would-be entrepreneur: What actually is the cost of establishing a business in Dubai? Depending on whether you are going for LLC company formation in Dubai or the Freezone, or the Offshore option, there are several variables determining the entire investment, many of which could easily slip past a first-time founder.
This blog will take you through the setup costs, hidden expenses, and value-added services that you have to account for. Being an expert leading consultant for business setup services in Dubai, Damaar commits to full transparency and support from day one.
Understanding Dubai Jurisdictions: Mainland, Freezone & Offshore
Before we delve into the numbers, we need to understand the three main types of business jurisdictions in the UAE:
Mainland: Provides access to the entire UAE market and allows legal interaction with government entities.
Freezone: A good legal structure for companies that operate internationally or online; under free zones, foreign ownership is 100 percent allowed, and the companies are exempted from paying income tax.
Offshore: Generally stands for asset protection or overseas operations; it cannot be used for trading onshore.
Each one follows different rules regarding costs. Damaar then works with clients to identify the most strategic and lowest cost-worthy jurisdiction for the specific type of business.
Factors That Determine Business Setup Costs
1. Type of Business Activity
The nature of your business—whether it’s foodstuff trading, consultancy, logistics, or retail—dictates the type of license required, and with it, the cost. A commercial license for a foodstuff trading business in the Dubai mainland, for example, requires additional regulatory approvals.
2. Legal Structure
The mainland company formation in Dubai often involves setting up as a Limited Liability Company (LLC), where you can now own 100% of the shares for most activities. This legal flexibility reduces the need for a local sponsor and can save recurring sponsorship fees.
3. Government & Licensing Fees
Your cost breakdown includes trade name reservation, initial approvals, MOA notarization, and license issuance. Based on a recent Damaar client quote, these government-related costs can total around AED 13,500 annually for a commercial license.
4. Office Space
In the mainland, a physical office or shop is mandatory. In Free Zones, virtual office options may be available, making setup more cost-effective. For the case of one foodstuff trading client, a Dubai office address was secured for AED 5,200 (one-time).
5. Visa Processing & Immigration
One of the biggest cost elements for new businesses in the UAE is visas, for both investors and employees. Here’s a typical breakdown:
- Immigration Establishment Card: AED 576/year
- Investor Visa: AED 7,596 (2 years, inside UAE)
- Employment Visa: AED 5,402–7,648 depending on category and location
- E-Signature, Labor Cards: AED 130–690
These costs quickly add up if you’re hiring staff, but are manageable with the right planning.
Optional & Value-Added Services
While licensing and visa costs are expected, here are additional services worth budgeting for:
- VAT Registration: AED 500
- Corporate Tax Registration: AED 750 (mandatory within 60 days)
- Import/Export Code: AED 450
- WPS (Wage Protection System) Setup: AED 250
- Bank Account Setup: AED 2,500–6,000 depending on the bank (WIO, RAK, FAB, Emirates Islamic)
Damaar also provides free value-added services like a company stamp, tax consultation, and WIO bank account assistance, offering added savings and convenience.
Sample Cost Structure (Mainland LLC Setup)
| Category | Estimated Cost (AED) |
| Government & License Fees | 13,500 |
| Office Address (One-time) | 5,200 |
| Service Charges (Company Setup) | 1,500 |
| Visa & Immigration (Investor) | 8,172 |
| VAT, Tax, Import Code, WPS | 1,950 |
| Optional Bank Account Opening | 2,500 – 6,000 |
| Estimated Total | 30,000 – 36,000+ |
Note: Costs will vary depending on business type, number of partners, visa needs, and jurisdiction.
Damaar’s Expertise: More Than Just a Setup Service
Starting a business in Dubai isn’t just about paperwork; it’s about navigating a complex but opportunity-rich ecosystem. Damaar brings years of on-the-ground experience to make your journey smoother and faster.
Here’s what sets us apart:
- End-to-end assistance from licensing to visa processing
- Transparent and itemised pricing, no hidden charges
- Guidance on Freezone company setup in Dubai and offshore options
- Personalised consultation to help you pick the most cost-effective path
- Access to local banks, tax experts, and regulatory authorities
- Optional add-ons like PRO services, bookkeeping, and visa renewals
Whether you’re setting up your first venture or expanding your global footprint, Damaar is the partner that ensures everything is done right, the first time.
Offshore & Freezone Options for Strategic Business Goals
Some clients prefer the flexibility and tax benefits of offshore company formation in Dubai, especially for international operations, asset protection, or holding companies. Others may find Free Zones more beneficial for e-commerce, media, or tech businesses. In both cases, Damaar tailors its services to suit your industry and expansion plans.
Budget Smart, Grow Smarter
Understanding the real costs of company formation in Dubai is essential for any entrepreneur looking to succeed in this competitive market. Whether you’re aiming for a mainland company formation, a Freezone license, or an offshore entity, knowing where your money goes and how to reduce unnecessary expenses can make a world of difference.
Partnering with an expert like Damaar ensures that your business setup process is not only fast and compliant but also aligned with your long-term vision. From licensing to visas, from tax registration to bank account opening, we handle it all, so you can focus on growing your business.
So, if you’re ready to take the leap into one of the world’s most promising business landscapes, let Damaar provide the business setup services in Dubai you can count on.
Visit Damaar for a free consultation or a customized cost breakdown tailored to your needs.
