How to Open an Auto Repair Business in Dubai?

How to Open an Auto Repair Business in Dubai – Complete 2025 Guide

Dubai’s automotive market is one of the strongest in the Middle East. With a growing number of cars on the road and rising demand for maintenance services, opening an auto repair business in Dubai is an excellent opportunity for Indian entrepreneurs. The city’s tax benefits, multicultural population, and strong infrastructure make it an ideal destination for setting up a car repair workshop, garage, or automobile service center. In this blog, we provide a complete step-by-step guide to starting an auto repair business in Dubai, including RTA and DED regulations, required documents, licensing costs, and how Flyingcolour® can assist you.

Why Start an Auto Repair Business in Dubai?

Dubai has one of the highest vehicle density rates in the world. More than 1.5 million vehicles are registered in the Emirate, and each requires regular maintenance. This creates massive opportunities for investors in the automotive service industry.

Key advantages for Indian entrepreneurs include:

• Growing demand for car repair and maintenance services
• High expat population owning vehicles
• Government support for SMEs and entrepreneurs
• Strategic location for auto parts imports and exports
• Tax benefits: No personal income tax and 9% corporate tax only above AED 375,000 (Federal Decree-Law No. 47 of 2022)

Business Models for the Auto Repair Business in Dubai

1. General Auto Repair Workshop-Provide multi-brand car repair and maintenance services.
2. Specialized Garage-Focus on luxury or specific brands like BMW, Mercedes, or Tesla.
3. Mobile Car Repair Service-On-site repair and assistance for customers.
4. Car Detailing & Body Shop-Paint, polishing, and car body services.
5. Auto Parts & Accessories Shop-Combine repairs with trading in spare parts.

Step-by-Step Guide to Start an Auto Repair Business in Dubai

Step 1: Choose Your Business Jurisdiction:  Mainland (DED) for full access to the UAE market, or Free Zones for cost-effective setup.

Step 2: Define Business Activity: Select from approved automotive activities under DED or Free Zone Authority.

Step 3: Trade Name Reservation: Register a unique name with DED/Free Zone (avoid restricted words).

Step 4: Initial Approval: Submit passport copies, shareholder details, and business plan.

Step 5: RTA Approvals: Auto repair workshops require approval from the Roads and Transport Authority (RTA).

Step 6: Lease a Suitable Space: Garage/workshop must comply with RTA safety and technical requirements.

Step 7: Draft and Sign MoA : For LLC structures, draft the Memorandum of Association.

Step 8: Obtain Trade License: Issued by DED (Mainland) or Free Zone Authority.

Step 9: Apply for Visas: Investor and employee visas for staff and mechanics.

Step 10: Open Corporate Bank Account: Required for financial operations in the UAE.

Legal & Regulatory Compliance for Auto Repair in Dubai

Auto repair businesses must follow several regulatory requirements. Key ones include:

• RTA Regulations: Workshops must meet safety, environmental, and operational standards.

• DED Regulations: Activity must match the approved business license category.

• Corporate Tax: 9% on profits exceeding AED 375,000 (Federal Decree-Law No. 47 of 2022).

• VAT Registration: Mandatory if turnover exceeds AED 375,000 annually (Federal Decree-Law No. 8 of 2017).

• Insurance: Liability insurance for workshop operations is recommended.

• Employment Laws: Comply with the UAE Labour Law for mechanics and staff.

Cost of Opening an Auto Repair Business in Dubai

The cost of starting an auto repair business in Dubai depends on jurisdiction, workshop size, and activities. Entrepreneurs should budget for trade license fees, RTA approvals, warehouse or workshop leasing, visa fees, and equipment purchases. Free Zones are generally cheaper, but the Mainland provides wider customer access.

Benefits of Starting an Auto Repair Business in Dubai

• 100% foreign ownership (post-2021 reforms)
• Huge customer base of residents and tourists
• Strategic hub for automotive imports/exports
• Strong demand for both budget and luxury vehicle repairs
• Ease of repatriating profits to India
• Availability of skilled workforce

Why Choose Flyingcolour Business Setup?

Flyingcolour Business Setup has over 20 years of expertise in helping Indian entrepreneurs start businesses in Dubai. We provide end-to-end services for auto repair business setup, including RTA approvals, trade license registration, visa processing, office and warehouse leasing, and corporate bank account opening.

Our services include:

• Free consultation for Indian entrepreneurs
• Assistance with RTA and DED approvals
• Trade license and MoA drafting
• Visa and Emirates ID processing
• Banking, tax, and compliance guidance

FAQs – Auto Repair Business in Dubai

1. Do I need RTA approval to open a garage in Dubai? 

Yes, all automotive workshops require RTA approval.

2. Can I start a car repair business in a Free Zone? 

Yes, but Free Zones may restrict direct mainland sales.

3. How long does it take to start an auto repair business in Dubai? 

Typically 2 to 4 weeks, depending on approvals.

4 . What type of license is needed? 

A commercial/industrial license from DED or Free Zone Authority.

5. Can I own the business 100% as an Indian? 

Yes, post-2021 reforms allow 100% ownership in most sectors.

Therefore, to learn more about opening an Auto Repair Business in Dubai, Book a free consultation with one of the Flyingcolour Business Setup team advisors.

The article was published on 21/08/2025. It is important to note that the federal policies and updates mentioned may have changed since then. For the most current information, please contact our consultant!