If you are starting a business in Dubai, one of the first questions you look for an answer is how much is it going to cost you. And, as is often the case, you end up finding numerous costs, sometimes with a huge disparity between each other. If this was your experience, then you are not alone.
There are several types of companies that can be established in UAE. However, in this article, we will be looking at the costs of setting up two types of companies in Dubai Mainland: Limited Liability Companies (LLC) and Sole Establishments.
Limited Liability Company (LLC)
In this type of entity, commercial, investment, manufacturing and real estate activities are permitted and not any insurance, banking or financial activities. A foreigner can be a shareholder with a UAE national owning 49% and 51% of shares respectively. Profit and loss distribution can be at different ratios. Liability of shareholders is limited to their shares in the capital. At least two partners are required and a maximum of 50, who can be shareholders and/or legal entities.
Overall company registration and license costs for an LLC is about AED 15,000 for a normal trading company. The above license cost may increase based on your business activity and office rental as the trade license fee would include 5% of your annual rent. In addition, you also need to rent an office space. Office rent per annum can cost as low as 15,000 AED or as much as millions AEDs depending on where and what type of commercial space you are renting. There are other costs for the trade name reservation, application fees, registration with various departments such as MOHRE and GDFRA which would be overall ~AED 5,000.
Both expats and locals can form sole establishments depending on the type of activity. Commercial activities can only be formed by UAE nationals and nationals of Gulf Cooperation Council (GCC). Activities include trading, construction, real estate, facilities management and more. Foreigners can register a Sole Establishment for professional and consultancy services, provided they appoint a local service agent who is a UAE national. The local service agent liaisons between the company and government departments. Professional services here include, HR consultancy, IT consultancy, management consultancy and more.
Average sole establishment license cost is AED 6,000. The above license cost may increase based on your office rent as these costs would include 5% of your annual rent. In addition, you also need to rent an office space. Office rent per annum can cost as low as 15,000 AED or as much as millions AEDs depending on where and what type of commercial space you are renting. There are other costs for trade name, application fees, registration with various departments such as MOHRE and GDRFA which would be overall ~AED 5,000.The above costs are rough estimates of setting up a business for doing standard activities.
Depending on the business activity, business setup costs may vary. Moreover, if the business activity requires approvals from various departments (i.e. Real Estate Regulatory Authority), additional costs will be incurred.
To find out a better estimate of your business setup costs in Dubai according to your preferences, please get in touch with us. Our experts will provide you with the most up to date information on you business setup costs in Dubai and other Emirates in UAE.