Starting a business in Dubai can be an exciting venture, but one of the first questions aspiring entrepreneurs often ask is, “How much will it cost?” The costs associated with setting up a business in this vibrant city can vary widely depending on several factors, including the business type, location, and required licenses. Here’s a breakdown of the key expenses to consider.

Business licensing fee:

One of the primary costs of setup business in Dubai is the licensing fee. The type of license you need—commercial, professional, or industrial—will influence the cost. On average, business license fees can range from AED 10,000 to AED 15,000 (approximately USD 2,700 to USD 4,000). In some free zones, where many expatriates choose to set up their businesses, these fees can be lower, depending on the specific zone’s regulations and offerings.

Local sponsorship costs:

If you’re setting up a business outside of a free zone, it’s mandatory to have a local sponsor, who must hold at least 51% ownership of the company. The cost for local sponsorship can vary significantly, with fees typically ranging from AED 5,000 to AED 50,000 (around USD 1,400 to USD 13,600) annually, depending on the sponsor’s reputation and the type of business.

Office space and utilities:

Renting office space is another significant expense. The cost will depend on the location and size of the office. In popular business districts like Downtown Dubai or Business Bay, prices can range from AED 60,000 to AED 200,000 (approximately USD 16,300 to USD 54,400) per year. Alternatively, businesses in free zones often have access to shared office spaces at lower costs, starting at around AED 15,000 (about USD 4,100) annually. Utilities and maintenance can add an additional AED 1,000 to AED 2,000 (around USD 270 to USD 540) monthly.

Registration and administrative fees:

When setting up your business, you’ll also incur registration and administrative fees. This may include trade name registration (around AED 1,000 or USD 270), initial approval from the Department of Economic Development (approximately AED 1,200 or USD 320), and additional fees for documents and approvals. Altogether, these costs can add up to AED 5,000 to AED 10,000 (USD 1,400 to USD 2,700).

Additional costs:

Depending on your business activity, you may need to consider additional costs, such as hiring employees, acquiring specific permits, and marketing expenses. Hiring staff can add significant payroll expenses, especially if you need skilled professionals. Moreover, you might want to allocate funds for marketing and branding to establish your business presence in the competitive Dubai market.