UAE Business Setup

UAE Business Setup SERVICES: Mainland vs. Freezone

Choosing the right jurisdiction is the most critical decision for launching a business in the UAE. Our services provide end-to-end support for both Mainland and Freezone company formation, ensuring compliance, speed, and cost-effectiveness.

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1. Key Benefits of UAE Company Formation

The UAE offers unparalleled advantages that make it a global business hub:

• Tax Efficiency: 0% Personal Income Tax and low Corporate Tax (9% on profits exceeding AED 375,000 for non-Qualifying Freezone Persons).
• Strategic Global Location: Gateway between the East and West, providing access to major global markets.
• 100% Foreign Ownership: Now available in most sectors for both Mainland and all Freezone companies.
• World-Class Infrastructure: Exceptional connectivity, logistics, and digital services.
• Residence Visa: Eligibility for a UAE Residence Visa for investors and their families.

2. Mainland vs. Freezone: A Crucial Comparison

Feature	UAE Mainland Company (Onshore)	UAE Freezone Company
Market Access	Unrestricted. Can trade directly anywhere in the UAE, including retail.	Restricted. Limited to trading within the Freezone or internationally. Requires a separate local distributor or a "Dual License" for Mainland operations.
Foreign Ownership	100% (for most business activities). Requires a Local Service Agent for Professional Licenses.	100% (always).
Regulatory Authority	Department of Economic Development (DED) of the respective Emirate (e.g., Dubai DED).	The independent Freezone Authority (e.g., DMCC, JAFZA, IFZA).
Office Requirement	Mandatory physical office space (typically min. 200 sq. ft.) to secure the license.	Flexible. Flexi-desks, co-working spaces, or virtual offices are often allowed, reducing costs.
Visa Quota	Generally unlimited, based on the size of the physical office space.	Limited (typically 1 to 6 visas), based on the package/office type (e.g., flexi-desk).
Government Contracts	Eligible to bid directly on UAE Government projects and tenders.	Not eligible to bid directly.
Corporate Tax	9% on taxable profit exceeding AED 375,000 (from June 2023).	Potential for 0% Corporate Tax if classified as a "Qualifying Freezone Person" with only Freezone/international income.

3. Estimated Business Setup Costs (Starting From)

Costs are highly dependent on the Emirate (Dubai/Sharjah/RAK), your chosen activity, and the number of visas required. The figures below are starting estimates for a basic service/consultancy license:

Cost Component	UAE Mainland (e.g., Dubai)	UAE Freezone (e.g., RAKEZ, IFZA)
Base Package	AED 15,000 – 25,000	AED 12,000 – 20,000
Includes License Fee, Trade Name, Initial Approval, DED/FZA fees
Office/Flexi-Desk	AED 20,000+ (Annual lease for physical office)	AED 0 – 10,000 (Annual fee for Flexi-desk/Virtual Office)
Investor Visa (per person)	AED 3,500 – 5,000 (Processing fees)	AED 4,000 – 6,500 (Processing fees)
TOTAL (Year 1, 1 Visa)	AED 38,500+	AED 16,000 – 30,000+
Annual Renewal	Generally Higher due to physical office & agent fees.	Generally Lower due to flexible office options.

Note: Additional costs apply for specialized activities (e.g., General Trading), document notarization, and visa processing for employees/dependents.

4. Limitations of Business Setup Services

As your administrative partner, our service handles the registration process. However, the business owner must be aware of certain compliance obligations:

• We Are Not Accountants or Lawyers: We provide templates and guidance but cannot offer specific legal advice (e.g., drafting a complex shareholder agreement) or manage your ongoing tax and bookkeeping (VAT filings, Corporate Tax filings). Action: You must hire an independent accounting firm.
• Bank Account Opening: We facilitate and expedite the process by preparing all required documentation (including the mandatory Establishment Card), but the final approval of the bank account is solely at the discretion of the UAE bank, which will require a personal meeting with the shareholder.
• Activity Scope: A Freezone company cannot directly operate retail outlets or provide general services to the local UAE market without additional licensing. Non-compliance risks significant fines and license revocation.
• Residency Requirement: The investor must visit the UAE to complete the medical examination and Emirates ID biometric scanning to activate the Residence Visa. We cannot complete this process on your behalf.