The city of Dubai is a dream place for expats who want to pursue their career and live better lives. It is also a great place for foreign investment where you have multiple business opportunities and flexible business laws which drive you to setup your business in UAE. If you are new here or if you have been living here for years, establishing your business here is quite a tough task for which there are whole lot of considerations. Having complete knowledge prior to your business setup is must, in order to avoid pitfalls.
One of the major considerations is the cost of your business setup. In this article, we will provide you breakup of costs which will give you broader idea for your own business setup.
The cost of your business depends upon the area that you have chosen for your operational work i.e. Dubai Mainland or Dubai Free Zone. For the establishment of mainland, free zone and offshore company, we have narrowed down list of things that you will have to incur your cost on.
Cost to Setup Free Zone Company
Setting up your business in free zone provides key benefits such as 100% foreign ownership, exemption from personal and corporate tax as well as import duties, complete repatriation of profits, confidentiality of your assets and many others.
There are various free zones in Dubai. Major ones include Jebel Ali Free Zone, Dubai Airport Free Zone, Dubai Multi Commodities Center, Dubai Media City. Less costly free zones are usually outside of Emirate such as Ajman Free Zone, Fujairah Free Zone.
In order to open free zone company, you are likely to be required a minimum share capital, the amount of which can vary greatly. Major costs include,
- One-time free zone business registration fee.
- Yearly free zone license cost
- Yearly free zone visa fees
- Annual or termly office rent
- Yearly bank guarantee for every employee
- One-time registered agent cost with renewal fees
- One-time fee for trade name reservation
- One-time Memorandum of Association Cost
- Postal services cost
- Health insurance
Cost to Setup Mainland Company
Mainland companies in Dubai by law are required to have a local partner who will hold 51% of shares and foreign entrepreneur will hold remaining 49% of shares. The most common form of mainland business is Limited Liability Company. It requires minimum of 2 and maximum of 50 shareholders whose liability is limited to company shares. Just like free zone companies, cost of setting up Mainland companies depends upon various factors like nature, size of business and its premises. Major costs which include for its setup include,
- Instant License fee from Department of Economic Division (one-time cost)
- Fees for reserving trade name (one-time cost)
- Office rent (yearly or termly cost)
- Drafting the Contract (in case of LLC) and Court Agreement Attestation (one-time cost)
- Memorandum of Association attestation fee( one-time cost)
- Registration fee (one-time cost)
- Trade License fee (one-time cost along with renewal fee)
- Commercial License fee (yearly cost)
- Commercial Services Improvement fees (yearly cost)
- Administrative services fee (one-time)
- Market fees (yearly or termly cost)
Cost to Setup Offshore Company
Setting up an offshore company means to incorporate your business outside of your home country. Offshore company in Dubai provides numerous benefits to foreigners such as tax exemption, complete ownership and confidentiality of assets and anonymity of name. The cost to setup an offshore company in Dubai includes,
- Company formation fees
- Share capital
- Office fee
- Cost to open bank account
- Agent fee
- Nominee services
- Business maintenance fees
Whether mainland or free zone, cost of setting up business in Dubai is a tricky and complex process. We recommend you to hire us as your consultant company so that we can provide you in detail about the cost structure according to your business plan. We have been successfully serving in Dubai for more than 10 years and our highly professional team helps entrepreneurs in establishing their business in Dubai with ease and efficiency. Contact our experts at KWSME for detailed information about the exact figures and any other guidance related to your company formation.