The Cost of Forming an LLC Company in Dubai

Forming a Limited Liability Company (LLC) in Dubai is a popular choice for entrepreneurs due to the flexibility, limited liability, and diverse business opportunities it offers. However, understanding the costs involved in setting up an LLC is crucial for effective financial planning. Here’s a breakdown of the costs associated with forming an LLC in Dubai.

1. Trade Name Reservation

Cost: AED 620 – AED 700

Before starting your business, you need to reserve a trade name with the Dubai Department of Economic Development (DED). This fee varies depending on the name’s uniqueness and other factors.

2. Initial Approval Fee

Cost: AED 120

The initial approval from the DED is a mandatory step that allows you to proceed with the company formation process. It confirms that the government has no objections to the business activity and the chosen name.

3. Drafting the Memorandum of Association (MOA)

Cost: AED 500 – AED 2,000

The MOA outlines the responsibilities, ownership percentages, and other essential aspects of the business. The cost varies depending on the complexity of the MOA and whether legal assistance is required.

4. Commercial License Fee

Cost: AED 10,000 – AED 15,000

The commercial license is essential for legally operating your business in Dubai. The cost varies based on the business activity, the location of the business, and other factors.

5. Office Space Rent

Cost: AED 15,000 – AED 100,000 annually

Renting office space is mandatory for obtaining a business license. The cost depends on the location, size, and type of office you choose. Dubai offers a range of options from business centers to dedicated offices.

6. Sponsorship Fee

Cost: AED 10,000 – AED 25,000 annually

If you’re a foreign investor, you’ll need a local sponsor who holds 51% of the shares in the company. The sponsorship fee is an annual payment made to the local sponsor.

7. Government and Administrative Fees

Cost: AED 5,000 – AED 10,000

These fees cover various government approvals, attestation of documents, and other administrative expenses. The exact amount depends on the nature of the business and the services required.

8. Visa Fees

Cost: AED 4,000 – AED 7,000 per visa

If your business requires hiring expatriate staff, you’ll need to account for the cost of work visas. This includes the cost of the employee’s visa, medical tests, Emirates ID, and other related expenses.

9. Additional Costs

• Notarization of Documents: AED 500 – AED 2,000
• Insurance: AED 500 – AED 2,000 annually
• Bank Account Opening: Some banks may charge a fee for opening a business account.

Conclusion

The cost of forming an LLC in Dubai can range from AED 50,000 to AED 200,000 depending on various factors such as the type of business, office location, and the number of visas required. It’s important to plan your budget carefully and consult with a business setup expert to ensure a smooth and cost-effective process.

For more detailed information and assistance with setting up your LLC in Dubai, visit Tycoon Documents – Business Setup Services.