Free Zone Business Setup, Registration, and Cost in Dubai
The question of what is free zone business setup in Dubai, UAE might give you a hint that they are only limited to specific areas. But the reality is that they are available throughout the UAE. The first free zone was founded in 1985 known as Jebel Ali Free Zone. Over the years, the numbers have increased totalling around 40 free zones in different areas of UAE. The free zones in Dubai are set up to open business opportunities for investors and entrepreneurs to take advantage of tax exemptions, easy document processing, and 100% ownership of the business. Dubai Free Zone also referred to as a free trade zone is a trade area where the rules and regulations are eligible for the particular zone and do not apply on businesses operating outside the free zone. The initiative of the Dubai Free Zone regulated by the UAE’s government was to attract foreign investment, boost economic activities, and allow entrepreneurs to enjoy maximum profits. Dubai free zone company setup is a lucrative opportunity for those who want to enjoy returns without paying hefty taxes, have complete ownership of the business, and keep the profits all by themselves.
Free Zone VS Mainland Dubai: What’s the Difference?
Company formation in the UAE free zone or mainland involves a lot of factors to consider. Whether it be a startup, a well-established business, or a small enterprise setup, the difference between Free Zone and Mainland Dubai must be looked at. Here’s a breakdown of the difference between the free zone and Mainland Dubai.
Jurisdiction: Mainland Vs Free Zone Dubai
The major difference between company formation in Mainland and Free Zone Dubai is that Mainland companies can operate anywhere in the UAE and internationally. However, when it comes to Free Zone Dubai company, it can operate internationally and within the free zone.
Rate of Taxation in Mainland Dubai Vs Free Zone
The rate of taxation in Mainland Dubai and the Free Zone is the deciding factor for most of the businesses especially startups and small enterprises. For instance, the rate of corporate tax in Mainland Dubai is 9% on profits exceeding AED 375,000. Whereas Dubai Free Zone is exempt from all kinds of taxes, making it a lucrative opportunity for small businesses and startups.
Custom Duty in Free Zone VS Mainland UAE
The company in Mainland Dubai is subject to customs duty while the Free Zone is exempt from all kinds of customs duties. A win-win situation for entrepreneurs thinking of a business setup in the free zone.
Value Added Tax (VAT) Free Zone Dubai VS Mainland
The VAT applicable to businesses operating in Mainland Dubai is 5%. While the business setup in the Dubai Free Zone has to pay 5% VAT. However, some zones have to pay 0% VAT, which makes it even more lucrative to set up a business in the Dubai Free Zone.
Physical Office in Free Zone Vs Mainland Dubai, UAE
Physical office in Mainland Dubai totally depends on the type of license you have obtained for your business. Whereas, the Free Zone company setup in Dubai allows you to have both a physical or virtual office, depending on your requirements.
Regulatory Body for Mainland Vs Free Zone
The regulatory body for governing mainland business setup in Dubai is under the Department of Economic Development (DED). Whereas, Free Zone UAE companies are governed by local government in the respective emirate. The rules and restrictions of each free zone are different and the company is not allowed to carry out business operations outside the free zone.
Visa Eligibility for Mainland Business Setup VS Free Zone
If you are setting up a business in the UAE free zone or mainland, the visa eligibility varies. For instance, free zone companies can offer limited visas to partners, employees, and dependents. Whereas, businesses operating in Mainland UAE have no restrictions on visas. However, the office space decides how many visas you need.
Benefits of Dubai Free Zone Company Setup
Dubai free zone company setup is not less than beneficial and financially sound for many startups and big enterprises. If you are looking for state-of-the-art facilities, tax exemptions, and top-notch business opportunities, company formation in the UAE Free Zone is lucrative. Here are some of the benefits of starting a business in free zone Dubai.
- 100% Ownership of Business
- 0% Corporate Tax
- 0& Import and Export Tax
- Sending 100% of Money to Own Country without Restriction
- Ideal Location for Starting a Business
- Global Reach and Unlimited Networking Opportunities
- Easy Registration and Document Processing
- No Currency Restriction
How To Register Company In Dubai Free Zone?
Everyone who has an investment and is interested in investing in the land of opportunities might ask how to start a business in the Dubai Free Zone. The process is simple and easy to follow. Here’s what you need to do to start a business in Dubai Free Zone.
Choose Your Business Activity
Setting up a company in the Dubai free zone involves many factors such as choosing the business activity. The nature of business plays a vital role in choosing an ideal location for starting a business in the free zone.
For instance, if you are a freelancer and run a company with a number of employees, choosing Free Zone Dubai is ideal, but not all free zones offer permits for freelancers.
Select Dubai Free Zone Suitable for Your Business
After deciding the nature of your business, the next step involves choosing the right location in the Dubai Free Zone. If you are unable to decide what location suits your business, the best option is to look for Dubai business registration consultants to help you out from the start until the end.
Choose a Name for Your Business
The next step is to decide the name of your business as per the government’s rules and regulations. Once you have picked the name, you can send it for initial approval from the Department of Economic Development or the free zone authority.
Apply for License
Applying for a license is crucial when it comes to setting up a business in the Dubai Free Zone. It involves gathering all the required documents, a business plan copy, and copies of the passports of shareholders.
After gathering all the documents, you have to submit them to the free zone authority. They will review and respond back within a week or two. Keep in mind, that you may need to submit additional documents in some free zones of Dubai.
Processing of Visa Application
Now it is time to submit your visa application for processing. You need to apply for a UAE residence visa along with visas for those working in your company, domestic staff, and dependents.
Applying for a Corporate Bank Account
You need to have a corporate bank account to carry on your business activities. Make sure that the corporate bank account is separate from your personal bank account and tailored to meet the requirements of Dubai Free Zone business operations.
What is the Cost of Opening a Company in the Dubai Free Zone?
The cost of setting up a company in the Dubai Free Zone includes registration from relevant authorities and may differ from one area to another. Normally the cost of opening a company in the Dubai Free Zone ranges between AED 11,900 to AED 50,000, which includes the cost of license and company registration.
How MAD Middle East Help in Starting Up Dubai Free Zone Company Setup?
Free Zone UAE business setup requirements require research, follow-up, processing and submitting documents, and acquiring a license and visa. The process involves finding a cheap location in the Dubai Free Zone, trade license registration, visa eligibility and requirements, and many other nitty gritty.
It’s tiring and gruesome for someone who is new to the business setup in the Dubai Free Zone. To ease the process and setting up a business in Dubai Free Zone seamlessly, you can count on Business Setup Advisor UAE.
MAD Middle East, one of the leading company setup consultants in UAE offers services to entrepreneurs and investors to setup a business in the Dubai Free Zone without any hassle. From choosing the cheap free zone location to acquiring and processing documents, applying for a visa, and opening a corporate bank account, we have got you covered.
If you are interested in company formation in the Dubai Free Zone, get a quick estimate for a business setup cost.
Why Set Up in a Free Zone?
Ease of Business Setup
The business setup process in most free zones is very easy. The particular application process will depend on your company and the free zone selected, but in most cases, all you need to do is provide some basic documents, such as copies of passports and business documents. The whole process often only takes a week or two. Many free zones also offer flexible desks and virtual plans that allow you to use the free zone addresses and facilities on an ad hoc basis for convenience.
Tax and Duty
This is perhaps the most captivating purpose for choosing the free zone: the tax regime. Your company is established in a free zone and benefits not only from 0% corporate and personal taxes but also from VAT, which is currently 5%. And that's just the tip of the iceberg. Companies in the free zone are also exempt from import and export taxes and can trade without currency restrictions.
Foreign Ownership
Another major advantage of being in the free zone is the ownership of a foreign company. Most overseas entrepreneurs are looking to set up business in the UAE mainland and need to work with local partners to do business. This is not the case in the UAE free trade zone. Set up your business here and you will retain 100% ownership of it.
Trading within the UAE
Free zone companies are not allowed to deal directly with the local UAE market, but this is easy to overcome. One option is to work with a local distributor who will bring your goods and services to market for a fee. Instead, it may be possible to set up your free zone business and then branch office of your free zone company in Emirates at a later date. These offices can be used to promote your packages and start a business in UAE.
Privacy Protection
Finally, free zones are very popular among data protection entrepreneurs because there is no open directory of company properties and company information such as shareholder information is never released to the public.
Benefits of Business Setup in UAE Free Zones
There are numerous advantages to beginning a business in the UAE. However, the UAE free zones offer some extra benefits if a foreign investor or international entrepreneur chooses to set up a business in one of the free zones. They are:
- Low freight charges
- Efficient single-window service and communication procedures
- Inexpensive workforce and easy recruitment procedures
- Liberal government policies and legal system
- Exemption from all export and import duties
- Inexpensive and abundant energy
- 100% exemption from personal, corporate and income taxes
- 100% foreign ownership
- 100% free transfer of funds and no foreign exchange controls
- 100% repatriation of profits and capitals
Company Formation Services in UAE Free Zones
Numerous businesses avoid putting investments into the UAE because of the impulse of having a UAE national as a partner with 51% shares claimed by them. Along these lines, free zones have become a well-known type of business registration in Dubai, UAE, where 100% of foreign possession is permitted. The UAE government has set up numerous free zones in the Emirates, each designed for explicit business activity. UAE free trade zones offer rewarding facilities to non-resident corporations, similar to the accommodation of single-window service, no bureaucratic red tape, and 100% ownership.
There are around 44 free zones situated everywhere in the United Arab Emirates that have pulled in international entrepreneurs and foreign investors direct investment as 200,000 companies add to the GDP growth. The free trade zones differ in their focus, setup expenses and administrative work required, yet the essential requirements are the same.
Here Are Some of the Most
Progressive and Advanced
Free Zones in the UAE
The vast majority of the UAE Emirates have set up free zones to give a boost to the economy in the region, market foreign investment, and drive development. Free Zone Authority is the government authority body that registers and issues licenses to operate to non-occupant companies in UAE free zones. The list of free zones set up across the UAE are discussed below:
Dubai Free Zones
Dubai Free Zones
Regardless of whether you just need data about Dubai free zone license cost or need to analyse the total Dubai free zone business setup cost, a professional business consultant at MAD Middle East can guide you. With 100% ownership and loosened up Dubai Free Zone visa rules..
Abu Dhabi Free Zones
Abu Dhabi Free Zones
Thinking about how to set up a business in the UAE free zone? Be it getting you the best quote on Abu Dhabi free zone license cost or getting you the choices on least expensive free zone in UAE, MAD Middle East team of professional business consultants cater you with the best...
Sharjah Free Zones
Sharjah Free Zones
The free zones in Sharjah are a decent choice for company formation in the UAE. Sharjah free zones give an innovative and present-day venue to new companies and business visionaries working in the media and technology enterprises just as businesses related to trade, import, and export...
Ajman Free Zones
Ajman Free Zones
Did you realize that as indicated by the Ajman Chamber of Commerce, during the first six months of 2019, Ajman Free Zone companies have contributed 32% of Ajman's complete exports and 60% of re-exports. Ajman Free Zone Authority or AFZA is a strategically located Free Zone...
Ras Al Khaimah Free Zone
RAK Free Zone
Would you like to set up a business in Ras Al Khaimah or need to know about Ras Al Khaimah trade license cost? Ras Al Khaimah Economic Zone (RAKEZ) is a promising locale that offers free zone and non-free zone company registration in the UAE. A significant explanation for foreign investors...
Umm Al Quwain Free Zones
UAQ Free Zones
The Umm Al Quwain Free Zone is a very profitable business location near the Umm Al Quwain port. An hour's drive from Dubai International Airport and Sharjah International Airport, Umm Al Quwain Free Zone (UAQ) is the ideal place to do business and establish your business in the UAE...
