When you are planning to start a company in the United Arab Emirates, one of the initial issues that will be on your list is the cost of the company. Knowing the cost of setting up a business in the UAE will help you plan your investment well and not to be disappointed in the future. This guide has tallyed all the significant expenses of various setups to make you aware of the cost.
What has an effect on the UAE Business Set-up Cost?
The overall price will be determined by several important factors:
- Kind of company you desire to start
- Jurisdiction (Mainland, Free Zone, Offshore)
- Number of visas you need
- Office space requirement
- The government allows and attends to you
Costs are not fixed. They vary according to your business plan, location, and the option of additional services such as legal assistance or PRO assistance.
Cost of setting up a business in the mainland
In mainland companies, you will be free to trade in the UAE market. They are also able to win government contracts and to serve the clients across the country. This access is more expensive.
Here’s a typical cost range:
- Trade license fees: AED 15,000 to AED 25,000
- Office rent: AED 15,000 to AED 50,000 annually
- Visa processing: AED 5,000 each
- Professional services and legal expenses: AED 3,000 to AED 10,000
The initial year of total costs can be either AED 40,000 to AED 95,000, depending on your activity and the number of visas to get.
Mainland establishment best suits businesses that require access to the market completely and have prospects of expanding. However, you should be able to afford more government and tenancy charges.
Free Zone Business Start-Up Value
The most desirable option for a foreign investor is the free zone companies. They are complete foreign ownership, quick formation, and tax incentives. The cost of UAE business establishment in free zones is normally low compared to the mainland.
Typical costs include:
- Business license: AED 7,500 to AED 15,000
- Registration fees: AED 2,000 to AED 5,000
- Office package: AED 4,000 to AED 12,000
- Visa and Emirates ID: AED 2,750 to AED 5,000
- Health and other government expenses: AED 300 to AED 1,000
An average first-year entry fee is approximately between AED 12,000 and AED 25,000 in basic free zone building. Others provide packages that are inclusive of visas and offices.
Free zone establishment is suitable to e commerce, consulting, trading, tech, and other SMEs that do not require an entry to the UAE local market.
Offshore Business set-up cost
The offshore companies are perfect in case you want to manage the assets, keep the investments safe, and operate internationally, but do not trade directly in the UAE market.
Here’s the usual cost range:
- Registration of the company: AED 6,000 to AED 15,000
- Agent or registrar fee: AED 3,000 to AED 10,000
- Paperwork and bank registration: AED 2,000 to AED 5,000
No physical office with fewer visas is the most economical option since offshore arrangements do not need a physical office.
The Fees of the License and their Implication
Also depends upon your type of business license:
- Trade and goods commercial license
- Professional license of services and consultation
- Industrial permit to manufacture
The license fees may vary greatly. In some emirates professional and industrial license may be even higher compared to a trading license. You must always make sure that you consult the relevant authority.
Office and Leasing Costs
You will need some sort of business address, whether you are on Mainland as a company or in the Free Zone.
- Flexi desk (shared workspace): AED 4,000 to AED 12,000
- Private office: AED 20,000 to AED 50,000 and above annually
There are free zones that permit cheaper virtual offices. Mainland structures typically require a physical lease between the authorities.
Visa and Immigration Costs
All owners and employees are required to obtain a UAE visa if they intend to work or reside in the UAE. Visa fees involve Visa approval, Emirates ID Visa, medical examination, stamping fees, and others. Each visa would cost between AED 3,000 and AED 7,000.
It is a good idea to plan early on the number of visas you are going to spend to avoid overestimating.
PRO and Consultancy Fees
Most entrepreneurs seek the services of a professional to carry out administrative work, clearance, and follow-ups. Depending on the services that are utilized, PRO fees can increase your budget by AED 3,000 to AED 10,000 and even higher.
The process can be expedited and expensive mistakes avoided by hiring seasoned setup consultants.
Hidden Costs to Watch For
Costs that are usually ignored at an initial stage are:
- The opening of bank accounts and the minimum balance
- Fees for document attestation and translation
- Employee benefits and insurance
- The renewal fees for the license are annual
It is better to budget these at the outset to have a clearer picture of how your UAE business set-up will cost.
How to Lower Your Setup Cost
Here are simple ways to save:
- Begin with a flexi desk rather than with an entire office
- Select a free zone offer package
- Keep the number of visas down until you expand your business
- Compare the fees of consultants and service providers
It does not require you to spend much in the beginning that can be saved with intelligent planning without compromising quality or compliance.
Conclusion:
The UAE is one of the locations that are the most business friendly to establish a company. An ideal budgeting approach will ensure that the cost of setting up your business in the UAE does not exceed your budget, and you will have access to a market that will continue to grow. Mainland, Free Zone, or Offshore, whatever you decide, the cost structure can help you choose the proper solution to meet your business objectives.
