Setting Up in a Dubai Free Zone: Package Costs Compared

Free zone packages are advertised with a price that is rarely the final price. If you want to compare offers, you need to know what is usually included, what is regularly missing and which items only appear in the second year.

The price tiers that exist

Our complete package for a free zone company formation costs EUR 9,999 without a visa and EUR 12,500 with one to two visas. It includes the licence, CT registration, establishment card, support with opening the bank account and one year of accounting.

What actually determines the price

The package price is not a list price but the result of four adjusting factors. Only if you know them can you compare offers at all.

• Number of visas: every visa raises the requirements for the office model. From three visas onwards, a flexi desk is no longer sufficient in many zones
• Office model: between a mere registration address, a flexi desk and your own office there is a difference of several thousand dirhams
• Activity: trading, consulting and media cost different amounts; regulated activities require additional approvals
• Zone: for the same project, there is a multiple between a low-cost all-round zone and the DIFC

The number of activities on the licence also plays a role. Many zones allow three to five activities in the base price and charge for each additional one.

What the package price usually does not include

• Medical and Emirates ID: around AED 1,000–2,000 per person, often charged separately
• Attestations and translations: EUR 200 to 800 if a company becomes a shareholder
• Bank account: opening takes time and some providers charge for it separately
• Accounting and tax return: mandatory from the first financial year, regardless of the tax rate
• Additional approvals: for regulated activities, with their own fees
• Name reservation and amendments: every later change to the licence or memorandum of association costs again

The second year adds up differently

Many offers are discounted in the first year. Realistically, from year two you should budget for:

• Licence renewal: from AED 16,000
• Visa renewal: AED 3,500–7,000 per person, every two years
• Office or desk: AED 5,000–25,000
• Accounting and, where applicable, audit: AED 8,000–16,000

If you only compare the entry price, you will bear the difference in the second year.

A calculation over three years

Take a consulting company with one visa and a flexi desk. The entry offer is AED 18,000. Over three years, the following are added: two licence renewals, one visa renewal, three years of accounting, medical and Emirates ID.

The total then regularly comes to two to two and a half times the advertised entry price. This is not a hidden fee but simply the difference between formation and operation; it is just not mentioned in the advertising.

When payments fall due

• The licence fee must be paid in full before issue, usually twelve months in advance
• Visa fees are charged per person as soon as the quota is drawn on
• Rent for an office or desk is usually paid annually in advance
• The renewal falls due before expiry; delays lead to late fees and can affect the company's visas

So do not only calculate the total, but also the timing. Most of the costs arise in the first few weeks, while revenue only comes in months later at the earliest.

The item nobody thinks about: the end

Closing a company also costs money. Depending on the zone, liquidation requires a dissolution resolution, the return of the licence and establishment card, the cancellation of all visas and often confirmation that there are no outstanding liabilities.

Budget several thousand dirhams and a few weeks for this. If, on the other hand, you simply let the company lapse, you accumulate late fees and risk records that make a later company formation more difficult.

What we look for when comparing prices

The cheapest provider is often the most expensive over three years. We regularly see two patterns: packages whose renewal price is significantly higher than the entry price, and zones where opening an account takes noticeably longer because banks view them cautiously. Neither appears in any offer.

A third pattern adds to this: packages that list an activity on the licence that does not match the actual business. This does not show up at formation, but it does when opening the account, and the change then costs fees and weeks.

Our recommendation: get the renewal price in writing before you sign. And calculate for three years, not one.

How we assess this

The price difference between the zones is real, but it is rarely the most important criterion. Two other questions are decisive: does the zone suit your activity, and do banks accept it without additional effort?

From our client work: clients who decide on price alone end up disproportionately often in a zone where opening an account is slow. The saving of a few thousand dirhams on the licence is then eaten up by six weeks of delay, and during that time the business is at a standstill.

Our advice: first determine the activity and the number of visas, then the zone, then the price. In that order, not the other way round.

Clarify before comparing

• How many visas do you need, today and in two years?
• What does the renewal cost, not just the formation?
• Are accounting and the tax return included?
• How quickly do banks open an account for companies in this zone?
• Does the licensed activity cover your actual business?

How the free zone compares with mainland and offshore is shown under Structure, costs and timelines at a glance.