Search "company formation Dubai" and you'll see the same number everywhere: "from AED 5,750." It's technically true and practically useless — because almost nobody pays only that. By the time you can actually operate, hold a residence visa, and open a bank account, the real figure is very different.
This is the honest breakdown: every line item, the fees the ads leave out, and realistic 2026 totals for three common scenarios. No teaser pricing.
The short version: A lean single-owner free-zone setup with one residence visa realistically lands around AED 18,000–30,000 all-in for year one. A mainland company with an office and a few visas is typically AED 30,000–55,000+. The "from AED 5,750" number is usually just the licence, with no visa, no establishment card, and no office.
The seven things you're actually paying for
A company setup isn't one fee — it's a stack. Here's the full stack, so nothing surprises you.
1. The trade licence
This is the headline number. In 2026, budget Dubai free-zone licences start around Meydan (~AED 12,500) and IFZA (~AED 12,900); the cheapest in the UAE is Ajman Free Zone (~AED 4,888, excluding visas). Premium zones (DMCC, DIFC, ADGM) run higher. Mainland licences via the Department of Economy typically start around AED 15,000 once approvals are included.
Your activity matters: regulated activities (crypto, financial services, some professional services) carry extra approval fees.
2. Registration & establishment fees
Name reservation, initial approval, MoA notarisation, and the establishment card (immigration card) that lets your company sponsor visas. Budget roughly AED 2,000–5,000 depending on structure. This is one of the most commonly omitted lines in teaser pricing.
3. Office or desk
Free zones often accept a flexi-desk / smart-desk (bundled or ~AED 5,000–12,000/year). Mainland usually needs a physical office with an Ejari tenancy contract — and your visa quota scales with office size. This is where mainland costs climb.
4. Residence visa(s)
If you want to live in the UAE, this is not optional. Each residence visa runs roughly AED 3,800–6,500, and that figure already bundles several sub-steps people forget:
- Entry permit
- Status change
- Medical fitness test
- Emirates ID
- Visa stamping
Multiply by the number of people (you, partners, staff, family).
5. Medical insurance
Health insurance is mandatory for residence visa holders. Basic plans start around AED 800–2,500 per person per year and scale up fast with age and coverage.
6. Bank account
Opening the corporate account itself is usually free, but expect minimum-balance requirements (often AED 25,000–150,000 depending on the bank) that tie up working capital. Some digital banks (Wio, Mashreq Neo) are lighter here. See our guide to opening a business bank account.
7. Ongoing / year-two costs (the ones that blindside people)
Setup is a one-off; running the company is not. Budget for:
- Licence renewal (annually — similar to year-one licence fee)
- Visa renewals (every 2 years typically)
- Corporate tax registration & filing — mandatory even if you owe 0%
- VAT registration if taxable turnover exceeds AED 375,000
- Bookkeeping / accounting — required to file corporate tax
- Office renewal, insurance renewal
Three realistic 2026 scenarios
These are all-in year-one estimates including the hidden lines above — not licence-only teasers.
Scenario A — Solo consultant / freelancer (free zone, 1 visa)
| Line item | Estimate (AED) |
|---|---|
| Free-zone licence (budget zone) | 12,900 |
| Establishment card + registration | 2,500 |
| Flexi-desk | included / 5,000 |
| 1 residence visa (all steps + Emirates ID) | 5,500 |
| Medical insurance (1 person) | 1,500 |
| Realistic total | ~AED 22,000–28,000 |
Scenario B — Small trading / e-commerce company (free zone, 2 visas)
| Line item | Estimate (AED) |
|---|---|
| Free-zone licence + activity approvals | 16,000 |
| Establishment card + registration | 3,000 |
| Desk / small office | 8,000 |
| 2 residence visas | 11,000 |
| Insurance (2 people) | 3,000 |
| Realistic total | ~AED 38,000–45,000 |
Scenario C — Mainland services company (office + 3 visas)
| Line item | Estimate (AED) |
|---|---|
| Mainland licence + DET approvals | 20,000 |
| Ejari office (small) | 20,000 |
| Establishment card + registration | 4,000 |
| 3 residence visas | 16,500 |
| Insurance (3 people) | 4,500 |
| Realistic total | ~AED 55,000–70,000 |
Your business isn't a template. Get your exact, itemised number with our cost calculator — 60 seconds, no email wall to see the estimate.
The hidden fees nobody advertises
- Establishment/immigration card — required before you can issue any visa. Frequently missing from quotes.
- Medical test + Emirates ID — often quoted separately from "the visa."
- Mandatory health insurance — a recurring annual cost, not a one-off.
- Bank minimum balance — not a fee, but it locks up capital.
- Corporate tax registration — mandatory for essentially all businesses, even at 0%.
- Attestation & translation of foreign documents — degrees, marriage certificates (for family visas), parent-company papers.
- PRO / government-liaison fees if you use an agent for renewals and amendments.
- VAT at 5% once you cross AED 375,000 turnover — with a AED 10,000 penalty for late registration.
How to genuinely reduce your cost (without cutting corners)
- Match the zone to your model. Paying DMCC prices for a solo online consultancy is overkill; a budget zone does the same job. But don't pick a zone so cheap it can't reach your customers — see mainland vs free zone.
- Buy only the visa quota you need now. You can scale later.
- Bundle setup + visa + insurance with one provider to avoid double-charged coordination.
- Time your VAT/tax registration correctly to avoid the AED 10,000 late penalty.
- Keep clean books from day one — retrofitting a year of accounting for your first corporate-tax filing is more expensive than doing it monthly.
Quick FAQ
Is "from AED 5,750" a scam? Not a scam — just incomplete. It's usually the licence only, with no visa, establishment card, office, or insurance. Always ask for an all-in quote.
What's the cheapest legitimate way to set up? A budget free zone (Ajman, IFZA, Meydan, RAKEZ) with one visa, if you don't sell into the UAE mainland.
Do I have to pay corporate tax if I earn under AED 375,000? You pay 0% on profit under AED 375,000, but you still must register and file. Small Business Relief (revenue ≤ AED 3M) can further simplify this — but note it's set to sunset at the end of 2026, so confirm current rules.
How much working capital should I keep aside? Beyond setup, budget for the bank minimum balance and 12 months of renewals, insurance, and bookkeeping.
Get the free cost breakdown template
We've packaged every line item above into a fill-in-the-blanks cost template (PDF) so you can build your own all-in budget before you commit a dirham. Get the template — we'll email it to you.
Next steps:
- Get your exact number → Cost calculator
- Decide your structure → Mainland vs free zone
- Plan your banking → Open a business bank account in Dubai
- Talk it through → Free consultation
Sources: UAE Federal Tax Authority (tax.gov.ae) for VAT and corporate-tax thresholds and penalties; 2026 published free-zone and visa fee ranges. All figures are market estimates for 2026 and vary by activity, zone, and provider — confirm current fees before committing. Last updated 1 July 2026.