Dubai Company Formation Costs: Mainland vs Free Zone

17 May 2025

By Vista Corp

Setting up a business in Dubai continues to be one of the most strategic moves for entrepreneurs in 2025. With its zero personal income tax, advanced infrastructure, and pro-business government policies, Dubai is not just a gateway to the Middle East—it’s a global launchpad. But one question that almost every investor or entrepreneur asks is: How much does it cost to start a company in Dubai? And more importantly, what’s the difference in cost between Mainland and Free Zone company formation?

This blog will break down the Dubai company formation costs: Mainland vs Free Zone, updated with the latest 2025 insights. Whether you’re planning to launch a digital startup, open a consultancy, or invest in commercial trade, understanding the cost structure is essential to make the right decision.

We’ll walk you through:

• What makes Mainland and Free Zone setups different
  
• The cost breakdown for each
  
• Hidden charges you should watch for
  
• A complete comparison table
  
• And how foreign investors can strategically choose between the two
  

From licensing to visa allocation, office rentals to annual renewals, we’ve covered all aspects of company formation in Dubai so you can launch your business with clarity—and without costly surprises.

Mainland vs Free Zone: Quick Overview

Before diving into numbers, it’s critical to understand what Mainland and Free Zone jurisdictions mean in Dubai. Your choice here doesn’t just impact cost—it shapes how your business operates, who it can trade with, how many visas you can issue, and the kind of office space you’ll need.

What is a Mainland Company in Dubai?

A Mainland company is registered with the Dubai Department of Economy and Tourism (DET)—formerly known as the Department of Economic Development (DED). This structure gives businesses full access to the local UAE market, the freedom to work with government entities, and the ability to operate without geographic restrictions.

Key features:

• Can trade freely within Dubai and across the UAE
  
• No limit on number of visas (subject to office size)
  
• Eligible to take on government contracts
  
• Requires a physical office space (Ejari)
  

Until a few years ago, Mainland companies often needed a local Emirati sponsor holding 51% shares. However, the 2021 reforms allow 100% foreign ownership for most activities—making this structure far more appealing in 2025.

What is a Free Zone Company in Dubai?

A Free Zone company is formed under one of Dubai’s 30+ Free Zones, such as IFZA, RAKEZ, DMCC, SHAMS, or Dubai South. These zones were created to attract foreign investment with simplified rules, 100% foreign ownership, and sector-specific benefits.

Key features:

• 100% foreign ownership—no need for a UAE national partner
  
• Designed for specific industries (media, tech, trading, etc.)
  
• Cannot trade directly in the UAE Mainland without a distributor
  
• Offers cost-effective office solutions like Flexi-desk/shared workspaces
  
• Often includes visa quotas, licensing, and immigration services in packages
  

Free Zones are perfect for startups, solo entrepreneurs, digital nomads, and exporters looking for low-cost setups with minimal red tape.

Key Differences Between Mainland and Free Zone (2025 Snapshot)

In summary, Mainland companies offer greater market access, while Free Zones offer cost-saving flexibility—especially for international or digital-first businesses.

Dubai Mainland Company Formation Cost in 2025

Setting up a Mainland company in Dubai gives you the advantage of trading anywhere in the UAE. But this flexibility comes with a cost structure that you must fully understand before committing. While the government has simplified several processes over the years, Dubai mainland company formation cost in 2025 still varies based on business activity, office space, and visa requirements.

Minimum Investment Required

Contrary to popular belief, Dubai does not mandate a fixed minimum capital for most businesses anymore. However, some regulated activities such as financial consultancy, manufacturing, or industrial activities may require proof of capital or deposits.

Tip: You’ll still need a commercial space with an Ejari lease to validate your license application. This is often the biggest cost factor for new Mainland setups.

Dubai Free Zone Company Setup Cost in 2025

For many startups and foreign entrepreneurs, Dubai Free Zone company formation offers an affordable and streamlined entry into the UAE market. With 100% foreign ownership, minimal paperwork, and industry-specific benefits, Free Zones are ideal for consultants, freelancers, e-commerce businesses, and international service providers. But what exactly does it cost in 2025?

Do Free Zone Companies Have Lower Renewal Costs?

Yes. Free Zone renewals are typically cheaper than Mainland renewals, especially for small businesses. Since Free Zones offer:

• No physical Ejari lease requirements
  
• Low visa renewal charges
  
• Bundled administrative support
  

However, if your company outgrows the Free Zone model or needs to trade in the local UAE market, you may eventually need to migrate to a Mainland license—which has higher renewal and operating costs.

Cost Comparison: Mainland vs Free Zone (2025)

If you’re deciding between forming a Mainland or Free Zone company in Dubai, understanding the cost differences can help you make the right call. While Free Zones often seem cheaper at first glance, your business goals and future expansion plans could make a Mainland setup more cost-effective over time.

Let’s break it down.

Which Is Cheaper: Mainland or Free Zone Company Formation?

On paper, Free Zone companies are typically cheaper to set up and maintain. Their packages are often all-inclusive, especially for solopreneurs or digital businesses with no physical office needs.

But for businesses aiming to:

• Hire more employees
  
• Operate physical stores or offices
  
• Trade locally in Dubai or the UAE
  
• Or bid for government contracts
  

…the Mainland structure offers long-term value despite higher initial costs.

Here’s a cost comparison table that summarizes both options:

Pros and Cons of Mainland vs Free Zone Setup

✅ Mainland Company Pros:

• Trade anywhere in the UAE
  
• No restrictions on client location
  
• Greater visa scalability
  
• Access to government tenders and contracts
  

 Mainland Company Cons:

• Higher setup and renewal cost
  
• Mandatory office lease
  
• Slightly longer formation timeline
  

✅ Free Zone Company Pros:

• Lower setup costs and easy packages
  
• Fast registration process (2–5 working days)
  
• Ideal for remote, online, or export businesses
  
• 100% ownership with fewer compliance steps
  

 Free Zone Company Cons:

• Can’t trade directly in UAE Mainland
  
• Limited visa issuance (depending on Free Zone)
  
• Relocation may be needed as business grows
  

In short, if budget is your main concern, Free Zones are your go-to. But if growth and operational freedom matter more, Mainland companies offer greater strategic value—especially in sectors like retail, logistics, education, construction, and F&B.

Factors Affecting Company Formation Costs in Dubai

Whether you’re choosing a Free Zone or Mainland setup, the final cost of company formation in Dubai doesn’t stop at just license fees. Several hidden and variable factors can influence how much you pay—especially if you’re scaling up, hiring employees, or engaging in regulated sectors.

Understanding these cost influencers helps you budget realistically and avoid surprises down the road.

What Factors Influence the Costs?

Here are the major variables that determine your total company formation expenses in Dubai:

1. Business Activity Type

• Some sectors like trading, e-commerce, and consultancy fall under standard license categories.
  
• Others, like real estate brokerage, education, or healthcare, require special approvals, insurance, or regulatory checks—all of which increase the cost.
  

2. Number of Visas Required

• Free Zone packages usually include 0 to 6 visa slots, and each additional visa beyond your plan.
  
• Mainland setups have no limit but depend on Ejari office size. More space = more visas = more costs.
  

3. Office Space / Lease Type

• Mainland companies must lease an office (Ejari).
  
• Free Zones offer Flexi-desks or shared units often included in the license cost—making them cheaper.
  

4. License Category (Commercial, Professional, Industrial)

• Commercial Licenses typically cost less to obtain and renew.
  
• Professional Licenses may need extra documents like degree certificates.
  
• Industrial Licenses involve factory approvals, warehousing, and higher capital investment.
  

5. Shareholders or Partners

• More partners mean extra notarization, MOA charges, and additional Emirates IDs or visas, slightly increasing cost.
  

6. Regulatory Authority Involved

• Mainland: Dubai Economic Department (DED)
  
• Free Zone: Varies (IFZA, RAKEZ, SHAMS, DMCC, etc.)
  
• Some Free Zones (e.g., Dubai Multi Commodities Centre) charge a premium fee due to brand value and business prestige.
  

Budget Setup Options for 2025

One of the most common questions aspiring entrepreneurs ask is:
“Can I start a company in Dubai on a limited budget?”
The answer is yes—especially in 2025, where Free Zones offer several startup-friendly options. Whether you’re a solo founder, freelancer, or small agency, you can find the right package without stretching your finances.

Let’s explore how.

Can I Form a Company in the Dubai Free Zone With a Low Budget in 2025?

Absolutely. Several Free Zones have introduced low-cost company formation packages that are tailored for:

• Consultants and coaches
  
• Freelancers and digital marketers
  
• E-commerce businesses
  
• Service-based entrepreneurs
  

Tips to Save on Company Formation Costs

If you’re launching on a lean budget, here are smart ways to cut unnecessary costs:

✅ 1. Choose Flexi-Desk Options

Most Free Zones offer Flexi-desks, which let you legally register your business and visa using shared space without leasing a full office. Saves thousands annually.

✅ 2. Skip Visas Initially

If you don’t need employees or a UAE residency right away, opt for a 0 visa package to reduce upfront investment.

✅ 3. Look for Promotions & Combo Deals

Many Free Zones and consultants offer limited-time offers like:

• “Get 1 Visa Free”
  
• “License + Establishment Card combo”
  
• “Pay /month with 0% interest”
  

✅ 4. Pay Annually, Not Monthly

Although monthly plans sound tempting, annual payments usually come with discounts and avoid hidden fees.

✅ 5. Work With a Business Setup Consultant

Instead of going it alone, a professional advisor can help you:

• Compare offers from different Free Zones
  
• Avoid unnecessary fees
  
• Package visa, license, and office needs into one affordable plan
  

Cost Inclusions and What to Expect

When you see a Free Zone or Mainland setup offer that says “Company License,” it’s natural to wonder—what exactly does that include?

In 2025, Dubai business formation packages are increasingly bundled to simplify the process, but understanding the components will help you avoid unnecessary extras or misleading quotes.

Let’s break down what’s typically included in your company formation cost.

What Is Included in the Dubai Company Formation Cost in 2025?

Whether you choose Mainland or Free Zone, here’s what your setup package may include:

✅ 1. Business License

This is the core legal permit issued by the relevant authority (e.g., Dubai DED or IFZA). It defines:

• Your business activity
  
• The jurisdiction you’ll operate in
  
• Your company name and legal status
  

✅ 2. Name Reservation & Initial Approval

You must reserve a unique trade name and obtain initial clearance from the authorities before registration.

✅ 3. Memorandum of Association (MOA) or Articles of Incorporation

Legal documentation that outlines ownership, rights, and responsibilities. For Free Zones, this is usually templated and simplified.

✅ 4. Establishment (Immigration) Card

Needed to sponsor employees or apply for visas under your company. This card is issued by the General Directorate of Residency and Foreigners Affairs (GDRFA) or Free Zone immigration authority.

✅ 5. Office Space or Flexi-Desk

You cannot register a business in Dubai without an address. Free Zones offer:

• Flexi-desks (shared space with limited hours)
  
• Dedicated offices
  Mainland companies must lease a space registered with Ejari.
  

✅ 6. Visa Quota (Optional)

Most packages include 0 to 6 visa quotas. If you need more, you’ll have to pay for:

• Visa allocation fee
  
• Entry permit
  
• Emirates ID
  
• Medical testing
  

✅ 7. Additional Services (Optional)

Some consultants include or upsell the following in packages:

• Bank account opening assistance
  
• VAT registration
  
• Business email/website domain
  
• Company stamp or legal translation
  
• Post-formation PRO support
  

These are often sold as “add-ons” and may not be part of the advertised package price.

 Pro Tip: Always Ask for a Full Quotation With Cost Breakdown

Avoid surprises by requesting:

• One-time setup cost
  
• Yearly renewal cost
  
• Optional services clearly separated
  
• Visa and immigration charges (if applicable)
  

A transparent proposal helps you compare real value, not just headline prices.

Mainland vs Free Zone Costs for Foreign Investors in 2025

Dubai has long positioned itself as one of the most attractive destinations for foreign investors, offering tax-free profits, 100% repatriation of capital, and simplified company laws. But for international entrepreneurs, cost isn’t just about how much you pay—it’s also about how much value you get from your investment.

Let’s examine how Dubai Mainland and Free Zone formation costs compare for foreigners in 2025, and what factors matter most when setting up from abroad.

How Do the Costs Compare for Foreign Entrepreneurs?

If you’re a foreign investor, your top concerns are likely:

• Full ownership rights
  
• Residency visa options
  
• Bank account access
  
• Ease of setup from overseas
  
• Cost transparency
  

Here’s how Mainland and Free Zone setups stack up:

📌 Example: An Indian investor starting a garment export company may prefer a Free Zone like RAKEZ or IFZA due to fast setup and lower cost. Meanwhile, a UK investor launching a marketing agency with UAE clients may benefit more from a Mainland license to freely serve the local market.

Additional Considerations for Foreign Investors

✅ Legal Support & Documentation

• Free Zones offer English-based, simplified paperwork
  
• Mainland may require legal translations, notarizations
  

✅ Banking

• Mainland companies tend to get faster approvals with Emirates NBD, Mashreq, RAKBank
  
• Free Zones may face added scrutiny depending on the business activity
  

✅ Residency

• Both setups allow for investor and family visas
  
• Free Zones may bundle a 2- or 3-year residency visa in the license fee
  

✅ Expansion Plans

• Want to open branches or stores later? Mainland has the edge.
  
• Want to stay lean and digital? Free Zone fits better.
  

🔍 Case Study: A Real Estate Investor from Germany

• Objective: Set up a holding company to invest in Dubai rental apartments
  
• Chosen Structure: Free Zone entity under Meydan
  
• Reason: 100% ownership, low renewal, no local clients
  
• Outcome: Completed setup remotely in 4 days, with 2 investor visas and UAE bank account in 3 weeks
  

In short, foreign investors have viable, cost-effective options in both Mainland and Free Zones—but the right choice depends on your business model, market access needs, and scalability plans.

How to Choose Between Mainland and Free Zone in Dubai

With so many business setup options in Dubai and varying costs across jurisdictions, choosing the right one can be overwhelming. But if you break it down by your business model, goals, and budget, the decision becomes much clearer.

Let’s walk you through a simple process to help you decide between Mainland and Free Zone—backed by real questions every entrepreneur should ask.

Questions to Ask Before Choosing

Before you decide where to set up your company in Dubai, ask yourself:

1. Who are my customers?
   
   • UAE-based clients? → Go Mainland
     
   • International clients only? → Free Zone is fine
     
2. Do I need a physical office or store?
   
   • Yes? → Mainland is required
     
   • No, I work online? → Flexi-desk in a Free Zone will do
     
3. Will I need multiple employee visas?
   
   • Yes? → Mainland is more scalable
     
   • Just me or a small team? → Free Zone packages cover it
     
4. Do I want the lowest possible setup cost?
   
   • Free Zones offer more startup-friendly rates
     
5. Do I plan to apply for government tenders or contracts?
   
   • Only Mainland companies are eligible
     

When Mainland Is a Better Fit

Mainland company formation makes sense when:

• You need local trading rights (retail, contracting, services)
  
• You require multiple employee visas
  
• You’re planning brick-and-mortar offices or showrooms
  
• You want full freedom to work with public and private clients in the UAE
  

Example: A restaurant, real estate brokerage, or construction company must go Mainland to legally operate and grow.

When Free Zone Is Ideal

Free Zone setup works best if you:

• Are a freelancer, consultant, or online business
  
• Have no immediate need for local market presence
  
• Want to keep costs low and setup fast
  
• Plan to operate remotely or internationally
  

Example: A digital marketing agency, software developer, or dropshipping e-commerce brand can thrive in Free Zones without the added burden of commercial lease costs.

✅ Quick Decision Matrix

Choosing the right jurisdiction is not just about cost, but about operational freedom, future growth, and legal compliance.

Updated Dubai Business License Cost 2025 Snapshot

Whether you’re forming a company in the Mainland or a Free Zone, your business license is the core legal document that allows you to operate. But the cost of a Dubai business license in 2025 can vary significantly depending on:

• License type (Commercial, Professional, Industrial)
  
• Jurisdiction (Mainland vs Free Zone)
  
• Business activity and visa requirements
  

Here’s a clear snapshot of updated pricing so you can budget accurately.

🔍 Bonus Tip:

Look out for seasonal discounts offered by Free Zones and Mainland authorities. Some offer:

• 50% off license renewal
  
• Free investor visa
  
• Complimentary office use for 1 year
  These can save you thousands annually!

Real Examples and Case Studies

You’ve seen the numbers, the comparisons, and the breakdowns. But how do these decisions actually play out in real life? To give you a clearer picture, here are two case studies of real entrepreneurs who chose different paths for company formation in Dubai—one in a Free Zone, and one in the Mainland.

Case Study 1: Digital Marketing Agency in a Free Zone

Founder: Priya Mehta, India
Company Type: Marketing Consultancy
Chosen Setup: SHAMS Free Zone (Sharjah Media City)
Year of Setup: 2025

🎯 Objective:

To offer digital marketing services globally with no need for local trade in Dubai.

💼 Package Selected:

• 1 Visa Media License
  
• Flexi-desk (included)
  
• Establishment card
  
• Investor visa processing
  

✅ Benefits:

• 100% ownership
  
• Setup completed remotely in 4 working days
  
• Valid UAE residency
  
• Low renewal fee
  

🔎 Outcome:

Priya was able to start taking clients from India, the UK, and Singapore using a Dubai company structure with global credibility, without overspending or needing a full office.

Case Study 2: Retail Business Setup in Dubai Mainland

Founder: Bilal Khan, Pakistan
Company Type: Boutique Perfume Retail & Trading
Chosen Setup: Dubai Mainland under DET (Dubai Economic & Tourism)
Year of Setup: 2025

🎯 Objective:

To open a retail store in Deira and sell both locally and online.

💼 Services Taken:

• Commercial Trade License (Mainland)
  
• Physical shop lease (Ejari contract)
  
• Two employment visas
  
• Corporate bank account setup assistance
  

✅ Benefits:

• Can trade anywhere in the UAE
  
• Access to government and private clients
  
• Unlimited scalability for visa additions
  
• Full ownership under new law reforms
  

🔎 Outcome:

Bilal’s boutique was operational within 3 weeks, had local staff hired under his visa quota, and even began B2B distribution to other retailers by month three.

🧠 Takeaway:

• Choose Free Zone if you want to stay lean, operate remotely, and prioritize budget.
  
• Choose Mainland if you need retail access, local market operations, or physical premises.

Final Thoughts on Company Formation Costs in Dubai (2025)

Choosing between a Mainland and Free Zone company in Dubai isn’t just a financial decision—it’s a strategic one. While Free Zones offer affordable, fast, and flexible options perfect for startups, freelancers, and international consultants, Mainland companies provide unmatched access to the UAE market, unlimited visa capacity, and long-term scalability.

Here’s a quick recap of what we’ve covered:

✅ Key Takeaways

• Free Zone Pros:
  ✔ Lower setup and renewal costs
  ✔ 100% ownership
  ✔ Remote setup possible
  ✔ Perfect for digital and international businesses
  
• Mainland Pros:
  ✔ Trade freely across the UAE
  ✔ No limits on business expansion
  ✔ Higher visa flexibility
  ✔ Access to local contracts and government tenders
  
• Hidden Costs to Watch:
  
  • Medical tests, Emirates ID, PRO services
    
  • Ejari leases for Mainland companies
    
  • Bank account support and VAT registration
    

 Final Checklist Before Choosing:

• ✅ Do you need to operate within the UAE local market?
  
• ✅ Do you require a physical space?
  
• ✅ How many visas do you need initially and in the future?
  
• ✅ Is budget a major constraint right now?
  
• ✅ Are you planning to scale or stay lean?
  

 Expert Advice:

“There’s no one-size-fits-all when it comes to Dubai company formation. The best decision is the one aligned with your business goals, target audience, and long-term vision. Cost matters—but clarity matters more.”
— Business Consultant, Vista Corporate Group

If you’re unsure, speak with a licensed business setup consultant who can walk you through real-time offers, legal considerations, and even help you compare proposals from multiple Free Zones and Mainland authorities.

Need help with your company formation in Dubai?

👉 Let Vista handle everything—from license to visas to banking—so you focus on your business.

Frequently Asked Questions (FAQs)

1. What is the average cost to form a company in Dubai Mainland in 2025?

The average cost to form a company in Dubai Mainland in 2025. This includes trade license fees, initial approvals, MOA drafting, immigration card, and Ejari-based office lease. Costs may vary based on business activity and number of visas.

2. How much does it cost to start a Free Zone company in Dubai in 2025?

In 2025, starting a Free Zone company in Dubai costs. The package usually includes the trade license, shared office (Flexi-desk), establishment card, and optional visa quota. Pricing depends on the Free Zone and visa requirements.

3. Which is cheaper: Mainland or Free Zone company formation in Dubai?

Free Zone company formation is typically cheaper than Mainland. Free Zones offer bundled packages. However, Mainland offers more flexibility for local trade and employee visas.

4. What factors affect the cost of setting up a business in Dubai Mainland vs Free Zone?

Key factors include business activity type, number of visas, office space requirements, jurisdiction, and regulatory authority. Mainland requires a physical office lease, while Free Zones offer Flexi-desk options. Visa quota and license type also impact the total cost.

5. Are there hidden costs in Dubai company formation for Free Zones or Mainland?

Yes. Hidden costs may include medical tests, Emirates ID, visa processing, PRO services, VAT registration, and office lease (for Mainland). Always request a full breakdown from your setup provider to avoid unexpected charges.

6. Can I form a company in Dubai Free Zone with a low budget in 2025?

Yes, you can form a company in Dubai Free Zone on a low budget. Some Free Zones like IFZA, SHAMS, and RAKEZ offer entry-level packages.

7. What is included in the Dubai company formation cost in 2025?

Dubai company formation cost in 2025 typically includes:

• Trade license
  
• Name reservation
  
• Initial approval
  
• Establishment card
  
• Office space or Flexi-desk
  
• MOA drafting
  
• Visa allocation (if included)
  

8. Do Free Zone companies in Dubai have lower renewal costs than Mainland companies?

Yes. Free Zone companies often have lower annual renewal costs—depending on the Free Zone. Mainland companies may incur higher renewal costs due to office lease requirements and additional government fees.

9. What’s the minimum investment required for Mainland company formation in Dubai?

There is no fixed minimum capital requirement for most Mainland licenses. However, and certain regulated activities (finance, legal, industrial) may require capital deposits or higher fees.

10. How do Dubai Mainland and Free Zone formation costs compare for foreign investors in 2025?

Foreign investors generally find Free Zones more budget-friendly for startups, with lower upfront costs and faster setup. However, Mainland offers greater market access, scalability, and flexibility for those planning physical operations or local trade in Dubai.