Cost to Setup a Holding Company in DIFC Dubai

Introduction

Setting up a holding company in the Dubai International Financial Centre (DIFC) offers significant advantages, including tax efficiency, a robust legal framework, and access to global financial markets. The DIFC is a special economic zone that attracts international businesses and investors due to its favorable business environment. This article provides a detailed overview of the costs involved in establishing a holding company in DIFC, Dubai.

Key Benefits of a DIFC Holding Company

• 100% Foreign Ownership: DIFC allows full foreign ownership without the need for a local partner.
• Tax Efficiency: Zero percent tax on income and profits, with access to a wide network of double tax treaties.
• Global Reach: Access to international financial markets and a robust legal system based on English common law.
• Regulatory Environment: Governed by the Dubai Financial Services Authority (DFSA), which ensures a high level of transparency and regulation.

1. Licensing Fees

The initial step in setting up a holding company in DIFC is obtaining the necessary licenses. The costs associated with this include:

• Application Fee: Approximately USD 8,000.
• Annual License Fee: Ranges from USD 12,000 to USD 25,000 depending on the nature and structure of the holding company.
• Name Reservation Fee: Around USD 2,000.

2. Registration and Incorporation Costs

Once the license is secured, you will need to register and incorporate your holding company. This involves:

• Registration Fee: A one-time fee of around USD 15,000.
• Incorporation Fee: Approximately USD 1,000.
• Miscellaneous Administrative Fees: Estimated at USD 500 to USD 1,000 for notarization, translation, and other documentation requirements.

3. Office Space and Lease Costs

DIFC requires businesses to have a physical presence within the zone. The cost of office space can vary depending on the size and location:

• Flexi-Desk (Small Office): Starts from USD 5,500 annually.
• Small Office (Approx. 200 sq. ft.): Costs around USD 30,000 to USD 40,000 per year.
• Larger Office Spaces: Can range from USD 60,000 to USD 150,000 annually, depending on the size and location within the DIFC.

4. Capital Requirements

Unlike some other jurisdictions, DIFC does not mandate a minimum capital requirement for holding companies. However, you will need to have sufficient capital to cover operational costs and other business-related expenses.

5. Professional Service Fees

To navigate the setup process, it’s advisable to hire professional services such as legal advisors, accountants, and corporate service providers. The costs typically include:

• Legal Fees: Range from USD 5,000 to USD 20,000, depending on the complexity of the setup.
• Corporate Service Providers: Charge between USD 5,000 and USD 15,000 for assistance with registration, incorporation, and ongoing compliance.
• Audit Fees: DIFC companies are required to conduct annual audits. Audit fees can range from USD 5,000 to USD 10,000 annually.

6. Visa Costs

As a holding company in DIFC, you may need to sponsor visas for shareholders, directors, and employees:

• Visa Application Fee: Around USD 1,000 per visa.
• Visa Deposit: Approximately USD 2,000 per person (refundable).
• Medical Examination and Emirates ID: Additional costs of around USD 500 per person.

7. Ongoing Compliance and Renewal Fees

Maintaining compliance with DIFC regulations requires annual renewals and submissions:

• Annual License Renewal Fee: Similar to the initial license fee, ranging from USD 12,000 to USD 25,000.
• Compliance and Regulatory Filing Fees: Estimated at USD 1,000 to USD 3,000 annually.

Total Estimated Costs

The total cost to set up a holding company in DIFC can vary widely depending on the specific requirements, office space chosen, and professional services engaged. A typical budget might include:

• Initial Setup Costs: USD 50,000 to USD 100,000.
• Annual Operating Costs: USD 40,000 to USD 80,000.

These estimates are for a standard holding company setup; costs may be higher for more complex structures or larger operations.

Conclusion

Setting up a holding company in DIFC Dubai requires a significant initial investment, but the benefits in terms of tax efficiency, regulatory support, and global reach can make it a highly attractive option for international investors and businesses. The costs outlined above provide a general guide, but it’s essential to consult with legal and financial advisors to tailor the setup process to your specific needs.

For the latest information and detailed guidelines, you can visit the official DIFC website:

• Dubai International Financial Centre (DIFC)
• Dubai Financial Services Authority (DFSA)

These resources offer up-to-date details on regulations, fees, and procedures for setting up a holding company in DIFC.