Dubai Business Setup in 2025: Costs, Timelines, and Free Zone vs Mainland (The Straight-Talk Guide)

Setting up a business in Dubai doesn’t have to be a maze of confusing paperwork and surprise costs. Whether you’re a first-time founder launching a SaaS startup or an established business expanding into the UAE, this guide cuts through the noise to give you exactly what you need to know about Dubai company setup in 2025.

We’ll cover real costs, actual timelines, and help you choose between free zone and mainland options without the sales pitch. By the end, you’ll know exactly which path fits your business and what to expect at each step.

Quick Navigation

• Free Zone vs Mainland: Which Path is Right for You?
• Dubai Company Setup Costs Breakdown 2025
• Step-by-Step Timeline: From Idea to Bank Account
• Top Free Zones for Different Business Types
• Banking in the UAE: Your Post-Setup Priority
• Tax and Compliance: What Actually Applies
• Common Mistakes to Avoid

Free Zone vs Mainland Dubai 2025: The Real Differences {#free-zone-vs-mainland}

The choice between free zone and mainland isn’t about which is “better”—it’s about which fits your specific business model and growth plans.

Choose Free Zone If:

You’re in consulting, digital services, SaaS, or ecommerce – Free zones offer 0% corporate tax for qualifying activities, streamlined setup, and 100% foreign ownership without a local partner.

You want speed and simplicity – Free zone licenses typically process in 3-7 business days versus 10-15 days for mainland.

Your clients are international – Most free zones allow unrestricted global business without needing a UAE address for clients.

You’re budget-conscious initially – Lower setup costs and no requirement for physical office space in many zones.

Choose Mainland If:

You’re selling directly to UAE consumers – Only mainland companies can trade freely within the UAE market without restrictions.

You need government contracts – Federal and Dubai government tenders typically require mainland licenses.

You’re in construction, retail, or manufacturing – These activities often require mainland setup with local market access.

You want maximum flexibility – Mainland licenses generally have broader activity scopes and fewer restrictions.

The 2025 Reality Check

Here’s what most guides won’t tell you: The lines are blurring. Many free zones now allow limited UAE market access, and mainland setup has become more foreigner-friendly. The key is matching your actual business activities to the license type, not getting caught up in generic advice.

Dubai Company Setup Costs Breakdown 2025 {#costs-breakdown}

Let’s talk real numbers. These are typical costs you’ll see in 2025, including government fees and essential services. Beware of packages that seem too cheap—they usually exclude crucial elements like visa processing or bank account assistance.

Free Zone Setup Costs

Budget-Friendly Options (AED 8,000 – 15,000)

• IFZA (International Free Zone Authority): AED 8,500 + 5% VAT for basic license
• SPC (Sharjah Publishing City): AED 12,000 + VAT for media/consultancy licenses
• UAQ (Umm Al Quwain): AED 9,500 + VAT for general trading

Mid-Range Options (AED 15,000 – 25,000)

• RAKEZ (Ras Al Khaimah Economic Zone): AED 18,000 + VAT with office options
• Meydan Free Zone: AED 21,000 + VAT for business services license
• SHAMS (Abu Dhabi Media Zone): AED 19,500 + VAT for media activities

Premium Options (AED 25,000+)

• DMCC (Dubai Multi Commodities Centre): AED 26,000 + VAT + office costs
• DIFC (Dubai International Financial Centre): AED 45,000+ for financial services
• JAFZA (Jebel Ali Free Zone): AED 28,000+ depending on activity and office

Mainland Setup Costs

DED (Department of Economic Development) License: AED 15,000 – 35,000 depending on activity

• Trade license: AED 25,000 – 30,000 + VAT
• Professional license: AED 18,000 – 25,000 + VAT
• Industrial license: AED 30,000+ + VAT

Additional mainland requirements:

• Local service agent: AED 3,000 – 8,000 annually
• Office space: AED 20,000 – 60,000 annually (Ejari required)
• MOA attestation and other documentation: AED 2,000 – 4,000

Hidden Costs to Budget For

Visa processing: AED 3,000 – 5,000 per person (investor/employee visas) Emirates ID: AED 1,000 per person Medical tests and insurance: AED 500 – 800 per person Bank account opening: AED 1,500 – 3,000 (plus minimum balance requirements) PRO services: AED 2,000 – 8,000 depending on complexity

What “All-Inclusive” Really Means

When you see packages advertised at AED 9,999 “all-inclusive,” read the fine print. Often excluded are:

• UAE entry visas
• Document attestations
• Bank account assistance
• Physical office setup
• Ongoing PRO support

A realistic all-in budget for most businesses ranges from AED 25,000 to AED 45,000 to get from zero to a functioning company with bank account and visa.

Step-by-Step Timeline: From Idea to Bank Account {#timeline}

Here’s what actually happens and how long each step takes in 2025, assuming you have all documents ready and make decisions quickly.

Phase 1: Pre-Application (1-3 days)

Day 1-2: Choose free zone or mainland, select activities, reserve company name Day 2-3: Prepare and attest required documents (varies by nationality)

Common delay: Document attestation can take 5-10 business days if done from overseas

Phase 2: License Approval (3-10 days)

Free Zone: 3-7 business days for most zones Mainland: 7-10 business days (can extend to 15 days for complex activities)

ReCorporate Pro Tip: IFZA and SPC typically have the fastest processing times, while DMCC and JAFZA can take longer due to higher scrutiny.

Phase 3: Visa Processing (5-7 days)

Investor visa: 5-7 business days after license approval Employee visas: 3-5 business days Family visas: Additional 3-5 days after primary visa

Critical factor: Medical tests and Emirates ID can add 3-5 days to the process

Phase 4: Bank Account Opening (7-21 days)

This is where most founders get stuck. UAE banks have become increasingly selective, and the process varies significantly by bank and business type.

Realistic timeline:

• Document preparation: 2-3 days
• Bank application and interview: 1-2 days
• Bank review and approval: 5-15 business days
• Account activation: 1-2 days

Success factors for faster approval:

• Clean business narrative explaining your activities
• Realistic projected turnover and transaction volumes
• Proper source of funds documentation
• Professional presentation of business plan

Top Free Zones for Different Business Types {#top-free-zones}

Every free zone markets itself as “the best,” but here’s the reality based on actual business needs:

For Tech Startups and SaaS

Winner: IFZA (International Free Zone Authority)

• Lowest costs: AED 8,500 + VAT
• 0% corporate tax for qualifying activities
• No minimum capital requirement
• Online-first processes
• Good for digital services, consultancy, software development

For Media and Creative Services

Winner: SHAMS (Abu Dhabi) or SPC (Sharjah)

• SHAMS: Strong reputation, government backing, good for large media companies
• SPC: Budget-friendly option at AED 12,000, suitable for freelancers and small agencies
• Both allow content creation, marketing, advertising, and consultancy

For Trading and Ecommerce

Winner: RAKEZ or Meydan

• RAKEZ: Flexible trading activities, reasonable costs, good UAE market access provisions
• Meydan: Central Dubai location, strong for B2B services, good banking relationships

For Financial Services

Winner: DIFC (Dubai International Financial Centre)

• Only choice for regulated financial activities
• Higher costs but unmatched credibility
• Access to DIFC Courts (English common law)
• Suitable for fintech, investment advisory, fund management

For Manufacturing and Logistics

Winner: JAFZA (Jebel Ali Free Zone)

• Largest free zone with comprehensive facilities
• Excellent logistics and port access
• Higher costs but industrial-grade infrastructure
• Good for import/export and manufacturing

The Budget Champion: IFZA

For most consulting, digital services, and small trading businesses, IFZA offers the best value in 2025. At AED 8,500 + VAT, you get:

• Company formation with 1-3 activities
• Initial approval certificate
• 1-year license validity
• Share certificates and memorandum
• Access to IFZA business centers

Banking in the UAE: Your Post-Setup Priority {#banking-guide}

Getting a UAE corporate bank account has become the biggest challenge for new businesses. Here’s what works in 2025.

The Banking Landscape Reality

Tier 1 Banks (Harder but Worth It):

• Emirates NBD: Strict criteria but excellent digital banking
• FAB (First Abu Dhabi Bank): Good for larger businesses, slower processes
• ADCB (Abu Dhabi Commercial Bank): Reasonable for SMEs, decent online platform

Tier 2 Banks (More Flexible):

• Mashreq Bank: Startup-friendly, faster decisions
• CBD (Commercial Bank of Dubai): Good for smaller businesses
• RAK Bank: Flexible criteria, especially for RAKEZ businesses

Digital Banking Options:

• Liv by Emirates NBD: For businesses under AED 5M turnover
• HSBC UAE: Good for international businesses with global HSBC relationships
• Standard Chartered: Reasonable for consultancies and digital services

Your Banking Success Strategy

1. Choose the right narrative: Banks want to understand your business model. “We help international companies expand into the UAE market through digital marketing” is better than “We do consulting.”

2. Prepare realistic projections: Don’t inflate numbers. A consultancy projecting AED 10M in year one raises red flags. Be conservative and credible.

3. Document everything:

• Business plan (8-12 pages maximum)
• Client contracts or LOIs showing expected business
• Source of funds documentation
• Professional profile/CV of key personnel
• Clear explanation of business operations

4. Consider multiple applications: Apply to 2-3 banks simultaneously. Each has different risk appetites and approval criteria.

5. Use professional support: Banking relationships matter. A good PRO service with established bank contacts can significantly improve your chances.

Minimum Balance Requirements 2025

Free Zone companies:

• Most banks: AED 3,000 – 10,000 minimum balance
• Premium accounts: AED 25,000 – 100,000

Mainland companies:

• Most banks: AED 10,000 – 25,000 minimum balance
• Current accounts: AED 3,000 – 5,000

Alternative: EMI Solutions

If traditional banking proves challenging, consider Electronic Money Institutions:

• RAKBANK’s digital solutions
• Mashreq Neo for businesses
• International options like Wise Business (for some activities)

Tax and Compliance: What Actually Applies {#tax-compliance}

UAE tax compliance has evolved significantly. Here’s what you need to know for 2025 without the legal jargon.

Corporate Tax (Introduced 2023)

The basics: 9% on profits above AED 375,000 annually

Who’s exempt:

• Free zone businesses meeting “qualifying income” criteria (income from qualifying activities with qualifying persons)
• Small businesses with revenue under AED 3 million (still must register and file)

What this means for most startups: If you’re doing genuine business activities in a free zone with international clients, you’ll likely qualify for 0% corporate tax. Mainland businesses pay 9% on profits above AED 375,000.

VAT Registration

Mandatory registration: AED 375,000+ annual turnover Voluntary registration: Available for smaller businesses Standard rate: 5% on most goods and services Zero-rated: Exports, international transport, some financial services Exempt: Healthcare, education, residential property

Essential Compliance Requirements

UBO (Ultimate Beneficial Owner) Declaration: Required for all companies, filed with relevant authorities ESR (Economic Substance Regulations): Applies to specific activities like banking, insurance, headquarters AML (Anti-Money Laundering): Compliance frameworks required for regulated activities

Common Mistakes to Avoid {#common-mistakes}

After helping hundreds of founders through Dubai business setup, we’ve seen the same mistakes repeatedly. Here’s how to avoid them:

1. Choosing Based on Price Alone

The mistake: Picking the cheapest package without understanding what’s included The fix: Budget for the complete journey—license, visa, bank account, and first-year operations

2. Ignoring Banking Requirements Early

The mistake: Focusing only on license approval and worrying about banking later The fix: Understand banking criteria before choosing your free zone and business activities

3. Overcomplicated Activity Lists

The mistake: Adding every possible business activity “just in case” The fix: Keep activities focused and relevant. You can always add more later

4. Underestimating Compliance Requirements

The mistake: Thinking free zones have no ongoing obligations The fix: Budget for annual renewals, audit requirements, and compliance filings

5. DIY Approach Without Local Knowledge

The mistake: Trying to navigate everything alone to save money The fix: Factor professional support into your budget—it often saves time and money long-term

6. Unrealistic Banking Expectations

The mistake: Expecting instant bank account approval with minimal documentation The fix: Prepare comprehensive business documentation and realistic projections

Documents Required for Dubai Company Setup

Here’s your complete checklist for 2025:

Personal Documents (All Partners/Shareholders)

• Passport copy (6-month validity minimum)
• UAE entry stamp or visa
• Passport-size photographs (white background)
• No-objection certificate (if employed elsewhere in UAE)

Business Documents

• Memorandum of Association (MOA)
• Articles of Association
• Share allocation agreement
• Initial approval certificate
• Lease agreement (for mainland) or office allocation (free zone)

Additional Requirements by Nationality

GCC nationals: Family book, salary certificate Other nationalities: Educational certificates (attested), experience certificates Some free zones: Police clearance certificate

Document Attestation Process

UAE Embassy/Consulate: Required for most documents from home country MOFA (Ministry of Foreign Affairs): Second-level attestation in UAE Timeline: 7-15 business days depending on document type and country

Why Choose ReCorporate for Your Dubai Business Setup

While this guide gives you the knowledge to make informed decisions, the actual setup process involves dozens of government touchpoints, bank meetings, and compliance requirements. Here’s where ReCorporate makes the difference:

What Sets Us Apart

Plain English Communication: No confusing jargon or hidden surprises. We explain each step before we take it.

Banking Success Rate: Our structured approach to bank applications has helped 400+ businesses secure accounts in 2024.

Speed Without Shortcuts: We move fast while keeping everything compliant with authorities and banks.

Fixed Pricing: You’ll know your total costs upfront, including government fees and our services.

Post-Setup Support: From compliance calendars to growth planning, we stay with you beyond license approval.

Our Complete Service Package

Company Formation: All UAE free zones and mainland options Visa Processing: Investor, employee, and family visas with Emirates ID support Banking Assistance: Bank shortlisting, application prep, interview coaching, and follow-up Compliance Setup: Corporate tax registration, VAT setup, UBO declarations, ESR compliance Ongoing Support: Monthly bookkeeping, payroll, audit coordination, renewal management

Ready to Start Your Dubai Business?

Whether you’re a first-time founder or expanding an existing business, we’ll get you from idea to bank account without the drama.

Free Consultation: 30-minute strategy call to discuss your specific needs and timeline Fixed-Price Packages: Transparent pricing with no hidden costs Expert Guidance: Local team with deep knowledge of UAE regulations and banking

Contact ReCorporate today for a straightforward conversation about your Dubai business setup. We’ll help you choose the right path and handle everything from paperwork to bank account opening.

Frequently Asked Questions

Can I start a Dubai company without visiting the UAE?

Yes, many free zones allow remote company formation. However, you’ll need to visit for visa processing, Emirates ID, bank account opening, and some document attestations. Plan for at least one 5-7 day visit to complete the full process.

What’s the cheapest way to set up a Dubai company with visa?

IFZA offers the most budget-friendly option at around AED 8,500 + VAT for company formation. Including visa processing and basic setup, expect a minimum budget of AED 15,000-20,000 total.

How long does it take to open a corporate bank account in UAE?

Realistically, 2-4 weeks from application to account activation. This includes document preparation (3-5 days), bank application and interview (1-2 days), bank review (7-14 days), and account activation (1-3 days).

Do I need a local partner for Dubai mainland company?

No longer required for most activities. The UAE now allows 100% foreign ownership for most mainland business activities, eliminating the need for local partners in many sectors.

What’s the difference between IFZA and other free zones?

IFZA is the most cost-effective option with streamlined processes, while zones like DMCC and DIFC offer premium locations and facilities at higher costs. The choice depends on your budget, business type, and growth plans.

Can I change my business activities after company formation?

Yes, most free zones and mainland licenses allow activity modifications. The process typically takes 3-7 days and involves government fees ranging from AED 1,000-5,000 depending on the changes.

Is UAE corporate tax applicable to free zone companies?

Free zone companies engaged in qualifying activities with qualifying persons can benefit from 0% corporate tax. However, they must still register for corporate tax and file annual returns to maintain this status.

What happens if my bank account application is rejected?

Don’t panic. Bank rejections are common and often due to incomplete documentation or unclear business narratives. You can reapply to the same bank after 6 months or immediately apply to different banks. Professional guidance significantly improves success rates.

Can I sponsor my family on a UAE business visa?

Yes, UAE investor and partner visas allow family sponsorship (spouse and children under 18). The minimum salary requirement varies by emirate but typically ranges from AED 4,000-10,000 monthly.

What ongoing compliance is required after company formation?

Annual license renewal, corporate tax filing (even if 0% rate), VAT registration and filing (if applicable), UBO declarations, ESR reporting (for relevant activities), and maintaining registered office address.

This guide provides general information about Dubai business setup in 2025. Regulations and requirements can change, and specific circumstances may require different approaches. For personalized advice and current requirements, consult with ReCorporate’s business setup experts.

Ready to transform your business idea into a Dubai-based company? Contact ReCorporate today for a free consultation and discover how we can streamline your setup process from start to finish.