When looking to start a small business in Dubai, financial investment is a crucial matter that must be carefully considered. The cost of setting up a small business in Dubai includes many financial aspects that must be determined and estimated accurately.

Establishing a company in Dubai requires bearing various costs, including registration fees, government licenses, legal and administrative costs for establishing the company and ensuring enjoyment of all available rights and privileges.

In addition, you should also take into account the costs of establishing an organizational structure within the company, such as hiring employees and providing the necessary infrastructure for efficient workflow, and this requires appropriate financial investments.

Furthermore, you must plan the expected costs of marketing and promoting the company, and this includes the costs of advertising, digital marketing and other promotional campaigns aimed at attracting customers and building business relationships.

Establishing a small company in Dubai also requires determining the capital necessary to start and ensuring business continuity without financial problems. This includes estimating the expected monthly and annual costs and ensuring the availability of sufficient financial resources to cover these costs.

In this article, we will generally address the cost aspects of setting up a small business in Dubai, without going into details of the exact numbers, to provide you with a broader understanding of the financial challenges you could face during this investment process.

The cost of establishing a small company in Dubai

Establishing a small company in Dubai

Establishing a small business in Dubai is an ambitious step that requires good planning and understanding of the local business environment. Dubai, thanks to its advanced infrastructure, strategic location and supportive government policies, has become a major business center in the region. Here we review the basic steps for establishing a small company in Dubai:

1. Study the market and determine the type of business activity

Before starting your company, you must study the local market and understand the demand and supply in the sector in which you intend to work. Determining the type of business activity helps you make the right decisions regarding licenses and legal procedures.
2. Choosing the type of company:

There are different types of companies that you can establish in Dubai such as:

• Limited Liability Company (LLC)
• Free Zone Company
• Sole Proprietorship
• Choosing the appropriate type depends on the size of your activity and business requirements.

3. Choosing a trade name:
You must choose a trade name that is appropriate and unique for your company. Check the availability of the name through the Dubai Department of Economic Development and ensure it complies with local laws.
4. Obtaining the necessary licenses
All commercial activities require obtaining licenses from the relevant authorities. This includes a commercial license from the Department of Economic Development and permits for certain activities.
5. Prepare the required documents

You will need to submit a set of documents to establish your company, including:

• Copy of passports for all partners
• workplan
• Memorandum of Association
• Proof of office address

6. Determine Company Location
Choosing a strategic location for your office or store is vital. You can choose to work from free zones or from commercial locations within Dubai based on your type of activity.

7. Opening a bank account
You must open a commercial bank account in one of the approved banks in Dubai to manage your financial transactions.
8. Obtaining residence visas
You will need residence visas for yourself and the employees you will employ. This requires submitting applications and providing the necessary documents.
9. Hiring Labor
Depending on the size of your business, you may need to hire employees. Be sure to comply with local laws regarding labor recruitment.
10. Register in the Value Added Tax (VAT) system
If your company\’s revenues exceed a certain threshold, you must register in the Value Added Tax (VAT) system and comply with all tax requirements.
11. Marketing and Advertising
Develop a marketing strategy to introduce people to your company and attract customers. Social media, traditional advertising, and digital marketing can be used.
12. Compliance with laws and regulations
Ensure that your company complies with all local laws and regulations, including those related to health, safety, environment, and employment.

The cost of establishing a small company in Dubai

The costs of starting a small business in Dubai vary greatly based on several factors such as the type of company, its location, and the consulting services required. Generally, these costs may include:

1. Registration fees: Includes company registration fees and government licensing fees.
2. Consulting fees: You may need legal and financial advice to assist with the incorporation process.
3. Contract costs: The costs of preparing the contracts necessary to establish the company and specify the terms and conditions.
4. Legal Services Fee: If you need legal assistance to complete the procedures.
5. Business Address Fee: If you need a business address to register the company.

These are general estimates and incorporation costs can vary significantly based on each company\’s individual circumstances. Contact us now, specialists in the field of establishing companies in Dubai, to obtain an accurate estimate of the potential costs.

Advantages of establishing a small company in Dubai

Establishing a small company in Dubai offers many advantages that make it an attractive destination for entrepreneurs and investors. Here are some of these features:

• Strategic location: Dubai is located in a distinct geographical location between Europe, Asia and Africa, making it an important commercial center that provides access to large global markets.
• Diversified economy: Dubai has a diverse economy that does not depend only on oil, but includes sectors such as trade, tourism, financial services, and real estate, which provides multiple opportunities for small businesses.
• Favorable business environment: Dubai provides a very favorable business environment with modern infrastructure, excellent logistics services, and advanced technologies, facilitating the operations of small businesses.
• Ease of establishment and procedures: Establishing companies in Dubai is considered a relatively easy process compared to many other countries, thanks to the effective administrative system and government support.
• Tax exemptions: Many free zones in Dubai offer attractive tax exemptions that include exemption from personal income tax and corporate tax for a certain period of time.
• Foreign Investment: Dubai encourages foreign direct investment, and allows 100% foreign ownership in many free zones.
• Quality of life: Dubai provides a high quality of life with advanced educational and health facilities, and diverse entertainment options, making it an attractive city to live and work.
• Security and stability: Dubai is characterized by a safe and politically stable environment, which provides reassurance to companies and investors.
• Government incentives: The government provides incentives and support to startups and small companies, including financing programs and technical and advisory assistance.
• Business Network: Dubai has a large international business community, providing opportunities to network and build business relationships with investors and entrepreneurs from around the world.

How to establish a company in Dubai

Costs of establishing a company in Dubai

Establishing a company in Dubai requires various costs that depend on several factors such as the type of company, business activity, and location (inside or outside the free zone). Here is an overview of the basic costs associated with setting up a company in Dubai:

1. Registration and license fees:

• Commercial registration fees: Includes the cost of registering the company and obtaining a registration certificate.
• License fees: Varies according to the type of business activity and the required business license (commercial, industrial, professional, tourism).
• Initial approval fees: Includes verifying the trade name and its availability, and obtaining initial approvals from the competent authorities.

2. Site costs:

• Office rent: The cost depends on the location and size of the office. The cost of rent in free zones can be higher than in other areas of Dubai.
• Free zone space rental fees: Includes rental fees and fees for additional services provided in the free zone.

3. Local agency fees:

• Local agent fees: If the company needs a local agent, there will be an annual fee paid to the agent.

4. Legal documentation costs:

• Documentation and contract fees: This includes documenting the incorporation agreement, lease contract, and other legal documents.

5. Consultation and service costs:

• Legal and financial consulting fees: relating to the services of lawyers and financial advisors who assist in the incorporation process.
• Management consulting services: Includes consulting fees and services provided by companies specialized in establishing companies.

6. Human resource costs:

• Visa and accommodation fees: Includes the costs of obtaining work and residence visas for employees.
• Health and social insurance fees: Includes costs associated with employee insurance.

7. Government service fees:

• Chamber of Commerce fees: Includes registration and joining fees to the Chamber of Commerce and Industry.
• Other government services fees: These may include additional costs related to various government services required to operate the company.

8. Marketing and advertising fees:

• Company launch costs: Include initial marketing and advertising campaigns to promote the new company.

9. Additional costs:

• License renewal fees: Annual fees paid to renew licenses and registrations.
• Logistics costs: If the company operates in a field that requires logistics services.

Important documents for establishing a company in Dubai

To establish a company in Dubai , there are a set of documents and procedures that must be followed. These requirements can vary based on the type of company and location (within a city or in a free zone). Here are the basic documents generally required:

• Incorporation application form: The incorporation application form must be completed and submitted to the company in question.
• Copies of Passports: Certified copies of passports of all partners and directors must be submitted.
• Copy of residence visa: If the founder or partners reside in the UAE, a copy of the residence visa must be submitted.
• Personal photos: Provide recent personal photos of all partners and managers.
• Initial approval: Initial approval must be obtained from the Department of Economic Development (DED) or from the relevant free zone authority.
• Company Articles of Association: includes information about partners, ownership percentage, and commercial activities. The contract is signed in front of a notary.
• Proof of Address: Provide proof of address to each partner such as a utility bill or lease.
• Business Plan: In some cases, it may be necessary to submit a detailed business plan outlining the company\’s planned business activities.
• Office Lease Contract: Submit a lease contract certified by the Real Estate Regulatory Authority (RERA) as proof of the company’s official headquarters.
• Registration fees: Pay the registration fees required for incorporation procedures.
• Security approvals: Some activities require special security approvals, which must be obtained before completing the establishment.
• Activity license: After completing the procedures and submitting documents, the company’s commercial license is issued by the Department of Economic Development (DED) or the relevant free zone authority.

In conclusion, it can be said that establishing a small company in Dubai represents a thoughtful strategic step that opens up countless opportunities for entrepreneurs. Dubai, with its strategic location and supportive regulatory environment, is an ideal destination for starting small businesses and achieving sustainable growth. Advanced infrastructure, an attractive tax system, and a diversified economy are all factors that contribute to making Dubai an ideal business environment that contributes to transforming entrepreneurial ideas into successful projects.

Moreover, broad government support and a thriving entrepreneurial culture contribute to providing a stimulating environment for innovation and development. Simplified procedures for establishing companies, coupled with political and economic stability, make Dubai a safe and promising choice for investors and business owners.

In short, establishing a small business in Dubai is not just a step towards starting a business, but rather an investment in a future full of possibilities and opportunities. Through careful planning and adherence to local laws, entrepreneurs can take advantage of everything Dubai has to offer to support their journey towards success and excellence in the business world.

The most important frequently asked questions about establishing a small company in Dubai