Dubai has always been seen as an international business city where those interested in business want to engage. This must be why people are eager to start their companies here: An advantage is a great location, socioeconomic environment, and friendly policies. However, one main point that needs to be highlighted is the cost of registering a business setup in Dubai. Below are some of these costs to ensure that setting up the program is as simple as possible.
Licensing Costs
Many people also consider another thing that could be improved when setting up a business in Dubai, which tends to be related to the license.
Commercial License: This license is compulsory for any business whose operations involve buying and selling goods in the market. As a rough estimate, obtaining a commercial license will set you back anything from AED 10000 to AED 15000 based on the business plan and its nature. This fee is charged at the time of the registration and shall embrace the computer-generated license…Nevertheless, the annual renewal expenses, which are also incurred, vary between AED 10,000 and AED 15,000.
Professional License: This license is for service-providing industries only, which include third-party consultants, marketing & advertisement services, and educational institutions. The professional license price varies from AED 7000 up to AED 10,000 and more. This usually comes with other requirement documents from the owner or key personnel of the business, such as their qualifications and experience. Other fees, such as the annual renewal fees, are comparable.
Industrial License: An industrial license is needed if a business involves production or manufacturing. These licenses are normally charged highly due to the kind of activities and the fact that companies under this category must observe environmental and safety measures. Using it could cost as much as AED 30,000, with the yearly renewals being approximately the same price.
Some extra costs likely to be incurred are fees for the initial approval and name reservation. For instance, the initial approval fee that applicants usually pay is estimated to be around AED 120, and the payment for trade name reservation might cost about AED 620.
Registration Fees
It is noteworthy that the government fees for business registration vary greatly. Here are some typical costs: Here are some typical costs:
Trade Name Registration: Registering a trade name is an important procedure that helps recognize the enterprise’s individuality and protect the name from being used by others. Current charges for trade name registration are AED 620. This fee pertains to searching and booking the business name.
Initial Approval: This involves attaining primary clearance before the actual registration of the business. This step includes filing the business plan and company profiles with regulators for initial approval. The initial approval fee is AED 120.
Memorandum of Association (MOA) Drafting: The MOA is a legal document that identifies how the business organization is structured and the function it is to perform. Drafting this document is likely to cost around AED 2000 to AED 4000. The ‘Memorandum of Agreement‘ (MOA) should be sworn to, which usually entails more expenses.
These fees pay for the official registration of your business and necessary permits and clearances.
Office Space and Location
The cost of office space can vary widely based on location and type: The cost of office space can vary widely based on location and type:
Free Zones: Dubai comprises several free zones to match various sectors of business and commerce. Free zones are a favorite because they offer privileges such as 100% international ownership, no taxation, and fewer restrictions on import/export. The average price for an office in a free zone may vary from AED 15,000 to AED 50,000, depending on its size. For instance, Dubai Silicon Oasis and Jumeirah Lake Towers have relatively affordable rental costs that are suitable for start-ups or, at the very least, small-scale businesses.
Mainland: Trading on the mainland establishes your business in the locality to sell products and services within those markets without much interference. Typically, the cost of office space varies depending on the location, which can be from AED 60,000 to AED 150,000 for commercial areas in Downtown Dubai, Business Bay, or Sheikh Zayed Road. These zones also allow for easy visibility and access, which is important for establishing a local operation.
Coworking Spaces: Coworking spaces are suitable for new firms because they provide cheap work sources. These cost-effective spaces offer more negotiable leasing terms and often have the most common areas within the building or development. Coworking spaces cost reasonably between AED 10,000 and AED 20,000 per year. Some of Dubai’s most well-known coworking spots are Impact Hub, Astro Lab, and We Work.
For instance, if we decide to set up in a free zone, there are advantages such as 100% ownership and free from tax, but on the other hand, the mainland allows us to be involved in the domestic market.
Visa and Immigration Costs
It is important for you as an employer and employees who might be traveling for business or other purposes, requiring them to leave the country for a while. Here’s a breakdown:
Investor Visa: An investor visa enables business people to live in the UAE and manage their businesses effectively. The visa entails fees varying from AED 4,000 to AED 5,500, including the cost of the medical tests and the fees for the Emirates ID. It is granted for a 3-year period, after which one can renew it.
Employee Visa: Employment means obtaining a working permit to allow new employees to work for the new company. The price for each employee visa starts from AED 2500 – 3500 dollars. This covers visa fees, medical tests, and Emirates ID costs. These types of visas may be for the employee for a couple of years or three years, depending on the employment contract period.
Dependent Visa: If you have family members as dependents, you must apply for dependent visas to take them to Dubai. The visa expense for each dependent is between fifteen hundred and two thousand United Arab Emirates dirhams. This fee entails visa charges, medical costs, and the Emirates ID. Depending on the country that has issued a dependent visa, it usually has a two-year validity and can be renewed.
This includes the costs of the visa itself, medical tests, and Emirates ID, where necessary.
Legal and Documentation Costs
Legal formalities involve several costs: Legal formalities involve several costs:
Notarization and Attestation: Legal documents should, therefore, undergo notarization and attestation to be approved. Notarization and attestation charges range from AED 500 to AED 1,000 for each document. Notarization and attestation refer to the legalization necessary for different legal and official actions, as it aims to confirm the genuineness of documents.
Translation: Of particular importance is the fact that in the host country, your documents should be in Arabic or in a language that an approved translator approves. Translation service prices may vary: A normally priced translation would cost between AED 100 and AED 200 per page. Legal documents are subject to translation without loss of meaning and legal specifics of the target language in compliance with local legislation.
Legal Consultancy: One should consider hiring a legal consultant since business regulations in Dubai differ slightly from those in other parts of the world. The cost of legal consultancy services may vary from AED 2000 to AED 5000 depending on the type of setup and associated services needed. Professionals in the legal field can help develop an agreement, acquire licenses for a company’s business, and resolve other legal matters about a certain country.
Getting legal documentation right also plays a crucial role since the company needs to observe local laws and regulations.
Additional Administrative Costs
Running a business involves ongoing administrative expenses: Running a business involves ongoing administrative expenses:
Bank Account Setup: It is crucial to find out how to open a commercial bank account because a firm’s financial management is important. The price of establishing a bank account also varies depending on the bank of choice and the type of account; normally, it is AED 500 to AED 2,000. Some of these services that banks in Dubai provide are business account-type options with services such as online banking and credit facilities.
Insurance: The Dubai law also states that all employees must have health insurance for themselves and their dependents. The health insurance fee may vary from AED 1000 to 2000 per person annually. Also, property and liability insurance may be needed, although depending on the coverage, costs can dramatically differ. For instance, comprehensive mandatory property insurance averages 2000-5000 AED in a year, and liability insurance, which is also compulsory, may cost between 1500-3000 AED.
Accounting and Bookkeeping: It is necessary to have ways to keep all the financial records up to date for matters concerning compliance and economic control. Specifically, the price accountants charge for accounting and bookkeeping services can be AED 1,000 – AED 3,000 per month, depending on the number of transactions and the company’s nature. These services can be obtained through outsourcing, which is vital since one may lack the expertise or time to do it personally.
These costs are incurred to ensure that businesses run effectively and without hitches.
Marketing and Promotion Costs
To establish your presence, initial marketing is vital To establish your presence, initial marketing is critical:
Marketing Campaign: Marketing is another crucial factor that can help a firm get started and get consumers in place. Affordability of a digital marketing campaign usually costs between 5000AED and 15000AED. This encompasses social media marketing, search engine optimization, and paid search /pay-per-click (PPC) advertising.
Website Development: Any professional should have a website or an online platform to showcase themselves or their company. The rates web developers charge for website development services could vary between AED 5,000 and AED 10,000. These include designing the website, creating the content, and performing the update work. Such expenditures may consist of payment gateways and security for e-commerce websites.
Branding and Logo Design: Brand management is crucial when establishing unique value for a business since it will help set it apart. Some of the most important services offered by various graphic designers and their fees include branding and logo design, which cost about AED 3,000 and AED 8,000. This entails creating a corporate image and identity that involves designing the logo, setting the tone and mood of the brand, and making such marketing collaterals as business cards and brochures.
Marketing involves determining and satisfying consumers’ needs to their maximum potential; hence, it plays a vital role in a business’s success in a particular market.
Miscellaneous Costs
Don’t forget about these additional expenses: Don’t forget about these extra expenses:
Utilities: There are incidental expenses, which may include the initial deposit of electricity, water, and internet charges, which costs about AED 5000. Condominium utility bills may consist of garbage collection, heating, electricity, and water bills, all of which may differ in amount and necessity depending on the size of the office and its usage.
IT Infrastructure: Establishing an IT structure encompassing computers, workstations, servers & software takes between AED 10,000 up to and including AED 20,000. These areas consist of hardware and software costs, such as acquiring licenses and professional services required for installation. Ensuring sound and efficient IT tools and assets is equally important for uninterrupted business flow and protection from threats.
Furniture and Office Supplies: Office equipment and supplies include furnishing the office and buying other materials, which may take about AED 10000-AED 30000, depending on size and material quality. This includes furniture like desks and chairs, storage equipment, writing materials, and fast items.
These costs make your business environment operative and well-equipped for efficiency.
Ways of Controlling and Avoiding Cost
Communicating cost parameters of doing business in Dubai requires a system of differentiation. Here are some tips to manage and minimize these costs effectively: Here are some tips to manage and reduce these costs effectively:
Detailed Cost Analysis: The last criterion is probably the most important, so it is advisable to analyze all possible expenses comprehensively. Using costs helps plan and control realistically, depending on each cost factor.
Customized Estimates: Choose your business type/form and enter the details for a more accurate cost estimate. Every business is different, and thus, applying unique methods in cost estimation will prove efficient in avoiding under or overestimating the cost.
Cost-effective Solutions: When selecting a license and location, choose the most cost-effective. For example, free zones provide some savings through license fees and taxes, while coworking areas help reduce rents.
Ongoing Support: Cultivate a working relationship to get support and advice for the management and cost. Some specific tips on where to get information and assistance include: If you strictly adhere to your business and do not attempt to sidestep any requirements, engaging business consultants or industry experts can sometimes give the best advice when it comes to certain regulations.
For instance, a relatively new tech firm reduced start-up costs by 20% by selecting a free-zone location and using shared-space solutions.
Conclusion
The cost of doing business in Dubai is important as it helps develop suitable strategies to implement during the initial stages of business establishment. To do this, it’s important to understand the many expenses that go into business formation exercises and seek expert assistance to avoid unnecessary costs. Talk to an expert at business setup consultation in Dubai for a detailed list of costs and help with the process of starting your business in Dubai.
Hockey fan, tattoo addict, audiophile, Saul Bass fan and RISD grad. Working at the intersection of modernism and mathematics to craft experiences both online and in real life. My opinions belong to nobody but myself.
