Key takeaways
- A UAE company's ongoing costs fall into four groups: licence and authority renewals, visas and staff insurance, tax and compliance filings, and bookkeeping or audit fees. The first-year formation quote usually covers only the first of these.
- Corporate tax is 9% on taxable income above AED 375,000, with 0% below that line, as of October 2026 (u.ae).
- Missing the corporate tax registration deadline costs AED 10,000 under Cabinet Decision No. 10 of 2024.
- A UAE company needs audited financial statements for corporate tax if its revenue exceeds AED 50 million in the tax period, or if it is a Qualifying Free Zone Person, for tax periods starting on or after 1 January 2025.
- VAT-registered companies file returns quarterly (monthly at AED 150 million turnover or more), normally within 28 days of period end; a late return costs AED 1,000 the first time and AED 2,000 if repeated within 24 months.
- Licence renewal, visa and bank fees are set by each authority, so no single figure is reliable; ask for the issuing authority's current fee schedule before budgeting.
What are the ongoing costs of a UAE company after setup?
A UAE company pays recurring costs to four groups: the licensing authority, the immigration and labour authorities, the tax authority, and its own accountants or auditors. Which ones apply depends on your free zone or mainland authority, your activity, your headcount and your turnover.
| Cost group | How often | Who sets the amount | Figure we could verify |
|---|---|---|---|
| Licence renewal, office or flexi desk | Yearly | Free zone or DET/DED | None; check the authority's fee schedule |
| Visa, establishment card, Emirates ID, medical | At issue and each renewal | Immigration, MOHRE, free zone | None; check the authority's fee schedule |
| Staff health insurance | Yearly | Insurer; Dubai and Abu Dhabi require it | Basic package AED 320 per year (u.ae) |
| Corporate tax and VAT filings | Yearly and quarterly | FTA (rules); your accountant (fee) | Penalty amounts, see below |
| Bookkeeping and accounting | Monthly | Your provider | None; quote on scope |
| Audit | Yearly, where required | Your auditor | None; quote on scope |
What do licence, visa and insurance renewals cost each year?
These fees are set by the issuing authority and change between free zones and the mainland, so the honest answer is to read the current fee schedule on your authority's portal. Qawi could not verify a single cross-zone figure from an official source, so none is given here.
Two points are verifiable. First, employers in Dubai and Abu Dhabi must provide health insurance for their staff, and u.ae says a policy is required before residency permits are issued or renewed for private-sector employees, with the requirement extending to the other emirates from 1 January 2025; u.ae states the basic package for the residency-linked policy at AED 320 per year, as of October 2026. Second, the federal unemployment insurance scheme charges workers (not employers) no more than AED 5 a month on basic salary under AED 16,000 and no more than AED 10 a month above that, with a AED 400 fine for non-subscription; investors who own the establishment are excluded.
What tax compliance do you pay for, and what do late filings cost?
The cost of tax compliance is your accountant's fee plus, if you slip, penalties that are fixed by Cabinet Decision. Corporate tax returns are due within nine months of the end of the tax period (30 September 2026 for a 31 December 2025 year end, per the FTA), and VAT returns within 28 days of period end.
| Obligation | Penalty or rule | Source, as of October 2026 |
|---|---|---|
| Late corporate tax registration | AED 10,000 | Cabinet Decision No. 10 of 2024 (MoF) |
| Late corporate tax return | AED 500 per month (or part) for 12 months, then AED 1,000 per month | Cabinet Decision No. 75 of 2023 |
| Late VAT registration | AED 10,000 | Cabinet Decision No. 40 of 2017, Table 1 |
| Late VAT return | AED 1,000; AED 2,000 if repeated within 24 months | Cabinet Decision No. 40 of 2017, Table 1 |
| Late payment of tax | 14% per annum, charged for each month or part of a month | Cabinet Decisions 75 of 2023 and 40 of 2017 |
| Failure to keep required records | AED 10,000; AED 20,000 if repeated within 24 months | Both decisions |
| Failure to notify a change to your tax record | AED 1,000; AED 5,000 if repeated within 24 months | Both decisions |
VAT registration is mandatory when taxable supplies and imports exceed AED 375,000 over the past 12 months (or are expected to within 30 days), and you must apply within 30 days of that point. Voluntary registration opens at AED 187,500.
If you'd rather not track these dates by hand, the free UAE compliance calendar lists them for your company: a free calendar of your company's UAE tax and compliance deadlines, personalised from a few questions, as a PDF and calendar file.
Do you need audited financial statements, and who pays for them?
Under Ministerial Decision No. 84 of 2025, a company that is not part of a tax group must have audited financial statements if its revenue exceeds AED 50 million in the tax period, and every Qualifying Free Zone Person must have them regardless of revenue. The decision applies to tax periods starting on or after 1 January 2025.
You pay the auditor directly, and the fee depends on your size and complexity. A free zone may also impose its own audit requirement for licence renewal; that rule varies by zone, so confirm it with yours.
How much should you budget for bookkeeping and accounting?
Bookkeeping and accounting fees are not set by any authority, so you have to get quotes; the number that matters is what the quote covers. A monthly retainer usually covers a defined scope (transactions, VAT returns, management reports), while per-service pricing charges for each filing.
Say a SHAMS trading company with about 40 invoices a month asks two providers for a quote: one price may include VAT returns and the corporate tax return, the other only monthly bookkeeping. The cheaper figure can cost more once the missing filings are added, so compare scope before price.
AED 10,000: the penalty for registering late for corporate tax or for VAT. Source: Cabinet Decision No. 10 of 2024 and Cabinet Decision No. 40 of 2017, checked 10 October 2026.
What most guides don't tell you
- Penalty tables have changed recently. Table 1 of Cabinet Decision No. 40 of 2017 was amended effective 14 April 2026, per the Ministry of Finance consolidated text, so figures quoted in older articles (for example on failure to notify tax record changes) may be out of date.
- "Month or part of a month" makes small delays expensive. Late tax is charged at 14% per annum in monthly steps, so a payment one day late is charged a full month, roughly 1.17% of the unpaid amount (14% divided by 12).
- Waiver for first-period corporate tax filers. The FTA waives the late registration penalty, or refunds it if paid, when the first return is filed within seven months of the end of the first tax period, through EmaraTax. It is worth checking before you pay.
- Staff insurance is a renewal condition, not an optional extra. u.ae says a policy is required before residency permits are issued or renewed, so a lapsed policy can hold up a visa renewal.
Which deadlines apply to your company?
Your costs depend on which filings your company actually owes, and when. The free UAE compliance calendar lists your company's tax and compliance deadlines, personalised from a few questions.
Frequently asked questions
Are there hidden fees in UAE company formation packages? Some packages cover only the licence and registration, so check in writing whether visas, medical and Emirates ID fees, office space, bank account opening and tax registration are included. Ask which authority charges each fee.
How much does it cost to open a company in Dubai, all in, including visas? The total depends on the licensing authority, the activity, the office option and the number of visas, so no single figure applies. Ask for a line-by-line quote covering the licence, visas, office, insurance and first-year compliance.
How do I check if a company formation agent is legit? Ask for the agent's own trade licence and check it on the issuing authority's portal, and get fees and scope in writing before you pay. Confirm who will actually do the work.
What questions should I ask a business setup consultant before paying? Ask what the quote excludes, what the second-year renewal costs, which ongoing filings are included and who handles them. Compare the answers with the licensing authority's published fee schedule.
About Qawi · Qawi is a corporate services firm licensed in the Sharjah Media City (SHAMS) free zone, handling company formation, visas and PRO, bookkeeping, VAT and corporate tax for UAE businesses. Guides are researched from FTA, Ministry of Finance and free zone sources. Qawi on LinkedIn
Sources
- Ministry of Finance: AED 10,000 penalty for late corporate tax registration (Cabinet Decision No. 10 of 2024)
- Ministry of Finance: Cabinet Decision No. 40 of 2017, consolidated text
- Ministry of Finance: Cabinet Decision No. 75 of 2023 on corporate tax administrative penalties
- Ministry of Finance: Ministerial Decision No. 84 of 2025 on audited financial statements
- FTA: VAT registration
- FTA: corporate tax page (return deadline notice)
- FTA: waiver of late corporate tax registration penalty
- u.ae: corporate tax
- u.ae: filing VAT returns
- u.ae: unemployment insurance scheme
- u.ae: getting health insurance
Last checked: 10 October 2026
This is general information, not tax or legal advice for your specific situation.