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Cost of Setting up a Sole Proprietorship in Dubai

By Shivangi - 13 Dec 2021 Last Updated: 06 May 2022
Cost of Setting up a Sole Proprietorship in Dubai

Table of Contents 

  1. 1. Why Dubai?
  2. 2. How is the government supporting businesses in Dubai?
  3. 3. What are the features of a Sole Proprietorship Business?
  4. 4. Why Sole Proprietorship?
  5. 5. Costs related to Setting up of Sole Proprietorship in Dubai
  6. 6. Conclusion

A sole proprietorship is a legal entity controlled by a single person who is individually liable for the liabilities of his or her company. In the emirate where it is registered, this form of business might engage in commercial or professional activity. Trading, import-export, real estate development, and manufacturing are just a few of the business activities that only UAE and GCC nationals are allowed to engage in under current legislation. Expatriates, on the other hand, can form a Sole Proprietorship exclusively for professional operations including medical and educational services, as well as specific types of consultancies like engineering, architecture, management, Auditing, accounting, IT, and legal.

Why Dubai?

The answer to the question, why Dubai is beneficial for setting up a sole proprietorship is that in the current era young individuals are highly attracted to entrepreneurship despite knowing the risks associated with it. Also, inclination towards a start-up world has also instigated young minds to move towards sole proprietorship businesses. Since entrepreneurship offers rewards and opportunities, which are not available to wage earners. This, coupled with the introduction of several legislative reforms have been in recent years to support small and medium businesses has given a significant rise to the number of entities over the years. Moreover, across the Middle East and North Africa, the UAE ranks first in terms of ease of doing business and 16th globally; and first in the GCC region in providing a regulatory environment that is conducive to starting a business, according to the World Bank's 2020 Doing Business Report.

How is the government supporting businesses in Dubai?

The government of Dubai has been playing an active role in supporting the growth of small and medium businesses in Dubai by bringing in policies and regulations promoting strong growth. As per the Government of Dubai, In as little as 15 minutes, an investor can apply online to launch his or her own firm on the UAE Mainland. In order to start a business in the traditional sense, the investor/owner must go through a series of stages, regulations, and approvals from the Economic Department and other government agencies.

Online Registrations

  • The UAE government launched the Bashr service to help people start businesses. Bashr is an integrated eService that allows investors to set up enterprises in the UAE in as little as 15 minutes using a single online platform. This portal is linked to federal and local government agencies that handle commercial licenses. The Dubai Virtual Commercial City initiative (VCC) was developed by Dubai Economy and other Dubai government agencies to allow entrepreneurs and freelancers from around the world to start a virtual firm in the UAE even if they do not live there.

Regular Registrations

Several steps are required to start the business in ordinary ways:

  • Identifying a business activity
  • Selecting an appropriate legal form
  • Registering the trade name
  • Applying for an initial approval
  • Drafting a Memorandum of Association and local service agent agreement
  • Select a business location
  • Get additional government approvals
  • Submit documents and pay fees

What are the features of a Sole Proprietorship Business?

  • A sole proprietorship can only be owned by one person, not by a corporation.
  • This person will own 100% of the company, be in charge of all operations, and get 100% of any earnings.
  • A professional-type Sole Proprietorship can be owned by
    an individual of any nationality.
  • A commercial or industrial sole proprietorship must be owned 100 percent by a UAE or Gulf Cooperation Council (GCC) national.
  • If the owner is not a UAE national, a Local Service Agent (LSA) is required (applicable only for professional licenses).

Why Sole Proprietorship?

Easy Set-Up, In the UAE, setting up a sole establishment is as simple as establishing any other sort of business. In reality, establishing a business on the mainland can be less difficult than doing so in a Freezone. Simply choose your license type and company activity, then submit your application to the Department of Economic Development (DED). The entire process is quite quick - recent initiatives have made setup so simple that you might be registered with the DED in as little as 90 minutes if you match the entry criteria.

Low-Cost Set-Up, The process for setting up a sole establishment in the UAE is not only quick and easy but affordable as well.

Easy Working with Sponsor, for foreign nationalists it is easy to form a sole proprietorship business by appointing a sponsor for their business who should be a UAE national.

Easy Financial Setup, The owner can open a Business Bank Account as soon as he/she has established sole establishment in the UAE and the business license is received. The application procedure is straightforward and quick. If you choose, a business formation specialist can recommend the appropriate bank for your needs and even set up meetings for you in-branch.

Read More: Comprehensive Guide on Opening an Investment Company in Dubai

Costs related to Setting up of Sole Proprietorship in Dubai

Dubai home-based businesses can obtain their sole proprietorship license from the Department of Economy (Department of Economic Development), which is the government body entrusted to set and drive the economic agenda of the emirate of Dubai, UAE. The license is issued under the trade name of the entity. Moreover, It can be applied through ?Invest in Dubai? platform with a fee of AED 1070 (license fees and knowledge and innovation fees) + AED 300 (Dubai Chamber membership fees).


Though setting up a sole proprietorship is a lucrative option in Dubai despite the fact that some of the initial stages may often become time-consuming and complex. With a number of experts with a large pool of knowledge, we assist our clients in handling and managing the paperwork along with the regulations of sole trader company registration from beginning to end. We further help our clients to establish a strong foundation for the organization that may help in achieving the organizational goals smoothly. If you require any services regarding any types of trade licenses in Dubai, please contact Dhanguard and we will gladly assist you.

Dhanguard provides the business setup and company formation services in Dubai, UAE with the guidance of our professional team of consultants. Faster and hassle-free company setup in Mainland and Freezone in UAE.

Dhanguard provides the company formation services in Dubai, UAE with the guidance of our professional team of consultants. Faster and hassle-free offshore company formation services and company formation services in Mainland and Freezone in UAE.

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