Business Setup UAE: Costs and Fees for Professional License Company Formation in Dubai
Setting up a company in Dubai is a strategic choice for many entrepreneurs around the world. If you’re considering business setup UAE, understanding the costs associated with obtaining a professional license in Dubai is crucial. This guide breaks down everything you need to know about licensing fees, government charges, and hidden costs to help you plan your business launch effectively.
What Is a Professional License in Dubai?
A professional license in Dubai allows individuals and businesses to offer services based on expertise and intellectual abilities. Professions such as consultancy, IT services, beauty salons, medical services, and legal advisory fall under this category. This type of license is ideal for entrepreneurs who are qualified professionals looking to start a company in the UAE.
Key Benefits of Business Setup UAE with a Professional License
A professional license provides various advantages for foreign investors and residents. These include:
- 100% foreign ownership in a mainland setup (with a local service agent, no equity involvement)
- Access to Dubai’s large local market
- Minimal capital requirements
- Flexible visa quotas
- Prestigious commercial address within Dubai
Starting a company under this license is a popular choice, especially for those offering specialized services.
Breakdown of Professional License Costs in Dubai
The total costs for a professional license can vary depending on the business activity, location, and other elements. Here’s a detailed breakdown :
1. Trade Name Registration – AED 620 to AED 700
The first step in business setup UAE involves selecting and registering a trade name through Dubai’s Department of Economic Development (DED). This is a one-time fee.
2. Initial Approval from DED – AED 120 to AED 150
This cost covers obtaining initial permission from the DED to proceed with the company formation process. It does not grant operational rights but is a necessary step.
3. Local Service Agent (LSA) Fee – AED 5,000 to AED 15,000 Annually
Foreign professionals must appoint a Local Service Agent (LSA), typically an Emirati national. The LSA does not hold equity but assists with governmental procedures.
4. Office Space Rental – AED 10,000 to AED 50,000 Annually
To complete the business setup in Dubai, a tenancy contract (Ejari) is required. Rental costs vary depending on the office size and location.
5. Professional License Issuance – AED 5,000 to AED 10,000
This is the core licensing fee payable to the DED for issuing the professional license.
6. Immigration Card – AED 500 to AED 2,000
To apply for visas for partners or employees, you must obtain a company immigration card.
7. Employment Visa Fees – AED 3,000 to AED 7,000 per Visa
The cost for each visa depends on the category and duration. Medical tests and Emirates ID charges are additional.
8. Additional Approvals – Variable
Some businesses may require special approvals from external ministries or authorities, especially in healthcare, finance, or education.
Recurring and Hidden Costs
Entrepreneurs must consider recurring costs in the planning process. These include:
- License Renewal Fees: AED 5,000 to AED 10,000/year
- Ejari Renewal: As per market rates
- Local Service Agent Renewal: Contractual, usually annual
- Visa Renewal: Every two or three years based on visa type
Also, there may be additional expenses such as:
- Attestation of documents
- Legal translations
- Insurance fees
- Bank account maintenance charges
Free Zones vs Mainland Setup Costs
While this article focuses on the mainland setup for a professional license, it’s worth considering how free zones differ. Free zones offer 100% ownership and package-based services, often at a lower cost but with geographical trade limitations. Learn more about this by reading our guide on Free Zone vs Mainland Trade Licenses.
Steps for Business Setup UAE Under Professional License
If you’re ready to start a business in Dubai with a professional license, here’s a simplified process:
- Reserve your trade name
- Obtain initial DED approval
- Draft and notarize the LSA agreement
- Sign the tenancy contract and register Ejari
- Submit documents and pay license fees
- Collect your professional license
- Apply for immigration and labor cards
- Begin visa processing as needed
Documents Required for Professional License
To ensure a smooth application process, prepare the following documents:
- Passport copies of all partners
- Residential visa or entry stamp copy
- No Objection Certificate (if applicable)
- Academic certifications (for regulated professions)
- Tenancy contract (Ejari)
- Drafted LSA agreement
For more detailed documentation insight, visit our article on Essential Documents Needed for Opening a Company in Dubai.
Can You Reduce Costs?
Here are few tips to reduce your overall cost:
- Choose virtual offices where applicable
- Negotiate with LSAs for competitive annual rates
- Bundle multiple services under one business activity to avoid additional license costs
- Choose locations with affordable tenancy rates
Conclusion: Is Professional License Setup Worth It?
Launching a business in the UAE with a professional license brings credibility, market access, and strategic advantage. Although the costs might seem high initially, the benefits usually outweigh the investment. By understanding all associated fees and planning accordingly, you can ensure a successful setup process.
Still confused? Visit the UAE Government Portal for official business setup resources.
Also check out our article on exact cost breakdowns of company formation in Dubai.
