The Ultimate Guide to Low Cost Business Setup in Dubai: Everything You Need to Know

Besides tourism, Dubai is also known for being a phenomenal business hub. Setting up a business can be expensive, but Dubai offers unique opportunities for entrepreneurs. With options for low-cost business setups starting from AED 1,042* per month, the city is an appealing destination.

This guide outlines how to navigate registering a company and manage costs effectively in Dubai. Dive in for a detailed step-by-step guide regarding low cost business setup in Dubai. Explore all the expert tips on launching your dream venture in without breaking the bank!

Low Cost Business Setup in Dubai: The Appeal of Dubai for Business Set Up

Dubai stands out as a prime spot for business folks from all over the globe for establishing affordable business setups. Hence, starting in Dubai with a solid business plane is a great idea for aspiring investors and entrepreneurs. Its location is super handy, with most of the world’s people just an eight-hour flight away. This city loves bringing different cultures together.

It makes everyone feel safe and welcome to do business. You can set up shop in special areas called free zones. Setting up in a free zone means you won’t have to pay income or corporate taxes. Plus, if you make money, you can send it back home without a hassle.

Starting a low-cost business in Dubai is easier on your wallet too; with costs lower than many big cities worldwide, Dubai draws in loads of new businesses every year.

Advantages of Starting a Business in Dubai, UAE

Dubai stands out as a top choice for business owners. The business hub offers many benefits that make starting and running a company setup easier.

  • Tax Benefits: In Dubai, businesses enjoy a tax-free environment. This means no personal income tax and no corporate taxes, which lets you keep all your profits.
  • 100% Ownership in Free Zones: You can own your free zone company fully. This allows international trade without needing a local sponsor.
  • Geographic Location: The city’s location connects East and West. It’s great for trading and gives access to markets in Asia, Africa, and Europe.
  • Government Support: The government is pro-business. They offer help through the Department of Economic Development (DED) and other agencies.
  • High-Quality Lifestyle: Dubai provides a comfortable life with modern infrastructure. It has good schools, hospitals, and transportation.
  • Diverse Population: Many expatriates live here, making it easy to find employees from different countries and cultures.
  • Political Stability: With steady politics and low crime rates, Dubai is safe for businesses.
  • Economic Growth: The city’s economy is growing fast. This opens up chances for new businesses to do well.
  • World-Class Infrastructure: The roads, airports, and ports are among the best. This helps with logistics and moving goods around the world.
  • Access to Funding: Banks in Dubai are ready to support new businesses with loans or credit options.

Considerations for a Low-Cost Business Setup in Dubai, UAE

When planning a low-cost business setup in Dubai, key factors such as choosing between mainland and free zones, identifying your specific business activities, and securing your trade or company name can significantly impact initial expenses—read on to navigate these considerations effectively.

Mainland vs Free Zone

One of the primary considerations for a low-cost business setup in Dubai is choosing between a Mainland and Free Zone establishment.

MainlandFree Zone
Operates under the Dubai  Department of Economic Development (DED).Self-regulated and subject to the rules of the respective Free Zone Authority.
Allows direct access to the United Arab Emirates and broader markets.Suitable for businesses targeting international markets.
No restrictions on number of visas, subject to office space.Visa allotment depends on the Free Zone’s regulations and office space.
Requires a local sponsor or agent (UAE national) for certain activities.Offers 100% foreign ownership without a local sponsor.
Could be more costly due to local sponsorship and physical office requirements.Typically seen as a budget-friendly option due to lower setup costs.

Choosing the right setup that best aligns with your vision is crucial for the business’s market access and governance. After understanding the differences between Mainland and Free Zone options, it’s important to determine the specific business activities.

Determining Business Activities

After choosing between mainland business setups and free zone setups, you’ll need to decide on the kind of work your business will do. Business experts like Xpert Advisory can help with this part of starting a company. Working with a company formation firm ensures a smooth setup process

They have a way to pick out what your business does best. This choice is very important because it sets the rules for getting a trade or business license in Dubai and how to run your business later.

You must list all activities that fit into what you plan to do in Dubai. Make sure each activity follows Dubai’s laws for naming and running businesses. This step helps prevent problems and delays when applying for permits or doing other needed tasks.

Trade Name Reservation

Picking a name for your business in the UAE, Dubai in this case, is a big deal. The DED has rules you need to follow. Your business name should not be like any other name out there and it must respect cultural norms.

Make sure the name relates to what your business does but avoid using names of places or famous companies.

To hold onto your chosen name, you have to reserve it with the DED. This makes sure no one else can take it while you get ready to start your company. You’ll pay a fee and this reservation lasts for a certain time.

If the time ends and you’re not ready, you may need to pay again to keep the name just for your use.

Steps to Starting a Business in Dubai

Embarking on your entrepreneurial journey in Dubai, i.e., forming a company or establishing a company, begins with a series of methodical steps, from licensing to visa management. Navigate the business setup process efficiently to turn your vision into a thriving reality in this dynamic market.

Applying for a License

Starting a company in Dubai means you must get a company license. For instance, if you wish to establish your company in a free zone, you should get a free zone license. This proves you can legally sell goods or offer services.

  • Choose what kind of company you will do. Make sure it fits into one of the categories allowed by DED.
  • Pick a name for your business. Follow Dubai’s rules to make sure no one else has the same name.
  • Decide if your company will be on the mainland or in a free zone. Each place has different benefits and rules.
  • Fill out a business application form with DED or the free zone authority. Give them all the details about your business.
  • Pay the fee for your trade license. The cost starts at AED 12,500* for a budget – friendly option that includes three activities.
  • Get approval from DED or the free zone. They might ask for more papers like your passport copy or business plan.
  • Sign a lease agreement if you need an office space or shop. You can also opt for virtual offices in the cheapest free zones.
  • Some businesses might need special permissions from other government departments, so check if yours does.

Following these steps is the accurate way to set or obtain a low cost free zone license without hassle. Remember, there are different types of business licenses available. Thus, make sure that you are applying for the right kind of license. 

Managing Visas

Managing visas is a key step in setting up your business in Dubai. You need to know the rules and get all your papers in order for your Dubai company formation.

  • Decide if you need visas for yourself, partners, and employees. This will depend on whether you choose a mainland or free zone setup.
  • Look into Meydan Free Zone for visa applications. They can help as part of starting your business.
  • Gather the necessary documents. Make sure they are correct and notarized as needed.
  • Fill out the visa application forms. Do this carefully to make sure everything is right.
  • Pay the visa fees. Know that these costs are part of your initial investment in the business.
  • Wait for approval from the authorities. This can take some time, so be patient.
  • Once approved, collect the visas. Make sure to check that all information on them is true and correct.
  • Keep track of visa expiration dates. Renew them on time to avoid problems with staying and working legally.

Understanding the Costs of Business Setup in Dubai

Grasping the financial business requirements of setting up a company is crucial when launching your in Dubai, from upfront investments to sustained operational expenses. It’s wise to dive deep into the breakdown of the cost of setting a business to ensure you have a comprehensive fiscal outlook for your business journey in this dynamic market. 

Initial Investment

Although starting a business in Dubai offers tons of benefits, it requires money up front. This is the initial investment for your low-cost company. It covers things like the professional services license required to do business, office space, and any equipment you might need. 

The nature of your business or the type of business you want to start will decide how much you must spend at first. For example, starting an e-commerce store might cost less than opening a front desk service.

You also have to think about where your business will be. Starting a business on the mainland as compared to establishing your business on a free zone can change the cost. Mainland setups may have different rules and costs compared to free zones which offer perks like full customs tax exemption but might limit where you can sell your goods or services.

Every choice affects how much money you need at the beginning to establish a business.

Ongoing Costs

Besides the cost of starting a business, running a business in Dubai means you will have separate costs to pay every year. You must renew your business licenses and permits. Even though it adds to the overall costs of the business, it keeps your business legal. If your company is on the mainland, you will also need to pay for things like rent, electricity, water, and money for your workers’ salaries.

Companies in the free zone have different costs like yearly fees for taking care of their space and visa fees for their staff.

When it comes to running a low cost business in Dubai, the money you spend each year can be around 10,000 AED* to 15,000 AED* if you have a small or medium-sized company. These costs are not too high for managing business operations compared to other big cities where businesses grow.

Planning well helps keep these costs manageable without hurting your wallet too much.

Potential Low-Cost Business Ideas for Dubai

Dubai’s growing economy offers many chances for low-cost business ideas. Here are some smart ways to begin a business in Dubai without spending too much money.

How to Set Up a Business in Dubai with Little or No Money

You can set up a low-cost business in Dubai even if you wish to do little to no investments. This sounds tough, but with the right idea and strategy, it’s possible. Look for business ventures that don’t need much cash to begin.

Think about services like tutoring, food delivery, or digital marketing that use your skills and don’t require buying lots of things at first.

Use the internet to find customers. An online store or social media platforms help you sell what you offer without spending on a physical shop. Work from home to cut costs more. For payments, focus on digital options such as mobile wallets and online banking which are usually cheaper than handling cash or checks.

Next up: wrapping up all we’ve discussed about setting up your dream business in Dubai! 


Starting a low-cost business setup in UAE, Dubai, can be exciting and rewarding. This guide has shown you the steps and benefits of setting up shop in this vibrant city. Remember, succeeding with a business setup in Dubai depends on how well the setup process goes. However, with careful planning and smart choices, your dream company doesn’t have to cost a fortune.

Dive into the world of lucrative business opportunities with the setup that best fits your needs and join the bustling markets of Dubai!


1. What do I need to know about starting a business in Dubai?

When you begin a business in Dubai, learn the rules for naming your business, get your contracts ready, and understand visa needs. Also know how much money you need to begin and follow the Department of Economic Development (DED) guidelines.

2. Can Indian entrepreneurs create a company in Dubai easily?

Yes, Indian entrepreneurs can set up their own company in Dubai with help from business setup specialists. They should look into forming an LLC for safety and think about working with free zones like Ajman or Sharjah for more benefits.

3. How do businesses handle payments and sales in Dubai?

Businesses use point of sale (POS) systems, online sales methods like e-commerce platforms, digital payments including credit/debit cards and bank transfers for electronic payment options which make billing easier.

4. Do I have to worry about taxes if I start a company in the UAE?

In the UAE, there’s something called value added tax (VAT) that affects bills and pricing. You’ll also need good accounting software to manage invoices, payroll, inventory costs and avoid problems with tax laws.

5. How should I plan advertising my new business to reach people?

A new business is easy to set if the right steps are followed. However, the more vital part is reaching new people. Hence, create marketing strategies based on understanding consumer behavior within your target audience using online ads or e-mail campaigns; Use tools like forecasting sales trends so you can buy enough products without wasting any. 

6. Are there special things foreign investors should do when opening shop in Dubai?

Foreign investors must follow local laws carefully related to imports/exports taxation licensing which includes checking against money laundering issues – but they will find ease of doing business overall thanks to collaboration between suppliers and distributors, along support provided by various economic departments.

This blog is intended for informational purposes only. The content is provided “as is” and we make no representations or warranties of any kind regarding its accuracy, completeness, or suitability. Any reliance on the information is at your own risk. We are not liable for any losses or damages arising from the use of this blog.

* – Fees and Costs Mentioned are for Reference Only.

Related Posts

Leave a Reply