UAE free zones in 2023
UAE free trade zones can provide a wide range of incentives for investors from around the world. The following information will help you decide whether establishing your company in one of the UAE free zones is beneficial for achieving your business objectives.
Healy Consultants Group PLC assists with all facets to register a new company in the form of a Free Zone Company (FZCo), including i) company registration; ii) assistance in obtaining the trade license; iii) lease premises and iv) assistance in opening a corporate bank account. Our staff will handle all formalities without our Client needing to visit Dubai.
International entrepreneurs can establish one of the following entities in the free zone. Healy Consultants will be pleased to assist our Clients in choosing the optimum business entity:
- A free zone company (FZC) – this entity requires a minimum of two shareholders;
- A free zone establishment (FZE) – this entity requires a minimum of one shareholder;
- Branch of a foreign company;
- Representative office from the parent company.
Advantages of setting up your business in a UAE free zone
- Investors who choose to setup in the UAE free zones enjoy the following benefits: i) 100% foreign ownership; ii) 100% import and export tax exemptions; iii) 100% repatriation of capital and profits; iv) corporate tax exemption for up to 50 years; v) personal income tax exemption and vi) assistance with labor recruitment and additional support services, such as sponsorship and housing;
- Other benefits include i) low bureaucratic requirements for incorporation; ii) fewer restrictions relating to staff recruitment; iii) high quality infrastructure facilities and iv) competitively priced energy and utilities;
- There are more than 35 operational free zones in the UAE. These include more than 25 in Dubai, 7 in Abu Dhabi and 8 in the Emirate of Sharjah and the Northern Emirates;
- Free zone activities allowed include i) import of raw materials; ii) manufacturing; iii) processing, assembling and packaging; iv) export of finished products and v) storage/warehousing of products.
Disadvantages of a UAE free zones entity
- FZ companies must confine their business activities to the zone itself, other UAE free trade zones and international customers. A FZ company cannot therefore cater to customers in within the UAE;
- To be fully established in a FZ, every company must i) lease premises and ii) obtain a free trade zone license. The type of license will restrict the activities that can be conducted in the company. Company licenses are renewable annually after FZ laws are complied with, including submitting annual audited financial statements to the authorities;
- FZ companies are non-tax resident entities and cannot enjoy UAE tax treaty benefits;
- The paid-up share capital varies from US$14 to US$300,000 depending on i) the free zone chosen and ii) the company structure. After incorporation, the share capital can be used to fund the daily business activities of the company;
- A FZ company must rent an office within its zone and cannot rent an office in Dubai city center.
Trading within the UAE
A FZ company can:
- Conduct business with and issue invoices to clients located outside the UAE or in other UAE free zones;
- A FZ company cannot conduct business with UAE mainland clients (those located outside free zones) by its own. Instead the FZ company must appoint a local service agent to sell and distribute goods and services in its name, within the city;
- Custom duty of 5% would be levied on free zones company sales within the UAE.
List of various free zones in the UAE
Abu Dhabi free zones
ABU DHABI FREE ZONES 1. Abu Dhabi Airport Free Zone 5. Abu Dhabi Ports Company 2. Free Trade and Logistics Zone 6. Khalifa Industrial Zone 3. Two Four 54 7. ZonesCorp 4. Masdar City
Dubai free zones
DUBAI FREE ZONES (Click link) 1. Dubai Studio City (DSC) 2. Dubai Airport Free Zone (DAFZA) 3. Dubai Media City (DMC) 4. Dubai Multi Commodities Center (DMCC) 5. International Media Production Zone (IMPZ) 6. Energy & Environment Park 7. Dubai Knowledge Village 8. Dubai Biotechnology & Research Park 9. International Humanitarian City 10. Dubai Textile City 11. Dubai International Financial Center 12. Dubai Flower City 13. Dubai Outsource Zone 14. Dubai Healthcare City 15. Dubai International Academic City 16. Techno Park 17. Gold and Diamond Park 18. Dubai Silicon Oasis 20. Dubai Internet City 21. Dubai Logistics City 22. Dubai Cars and Automotive Zone (DUCAMZ) 23. Jebel Ali Free Zone 24. Heavy Equipment & Trucks City 25. Dubai Maritime City 26. Dubai Auto Parts City 27. Other Free zones located in UAE
Sharjah and Northern Emirates free zones
UAE free zones comparison
Dubai free zones
Dubai Multi Commodities Center Dubai airport free zone Jebel Ali free zone Our recommendation in order of preference 1 2 3 Summary Total Healy Consultants fees (US$) 28,786 22,063 26,245 Incorporation time 3 months 3 months 3 months Cheapest yearly office rent estimate (US$) 6,000 10,700 16,500 Yearly warehouse rent estimate (US$) 24,500 25,000 25,000 Paid up share capital estimate for free zone company (US$) 14,000
272 (per shareholder) 0 Paid up share capital estimate for free zone establishment (US$) 14,000 272 0 Virtual office allowed Yes No No All shareholders must travel required for company formation No No No Legal considerations Minimum number of shareholders 1 1 1 Minimum number of directors 1 1 1 Corporate shareholders allowed Yes Yes Yes Corporate directors allowed No No No 100% foreign ownership allowed Yes Yes Yes Public register of shareholders and directors No No No Tax considerations Exempt of corporate tax on profits Yes Yes Yes Annual tax return to be submitted No No No Statutory audit required Yes Yes Yes Access to UAE double tax treaties Yes Yes Yes Other considerations Yes No No Types of licenses allowed View PDF View PDF View PDF Can rent office premises outside free zones No No No Allowed to import raw materials? Yes Yes Yes Allowed to export goods? Yes Yes Yes How long to get work permit approved 4 weeks 4 weeks 4 weeks Free zone work permit fee per person 4,950 4,950 4,950 Draft Invoice View invoice PDF View invoice PDF View invoice PDF
Sharjah and Northern Emirates free zones
RAKEZ Free Zone Sharjah Airport International FZ (SAIF) Our recommendation in order of preference 1 2 Summary Total Healy Consultants fees (US$) 21,800 29,890 Incorporation time 3 months 3 months Cheapest yearly office rent estimate (US$) 2,000 12,500 Yearly warehouse rent estimate (US$) 25,000 27,000 Paid up share capital estimate for free zone company (US$) 0 41,000 Paid up share capital estimate for free zone establishment (US$) 0 41,000 Virtual office allowed Yes No All shareholders must travel required for company formation No No Legal considerations Minimum number of shareholders 1 1 Minimum number of directors 1 1 Corporate shareholders allowed Yes Yes Corporate directors allowed No No 100% foreign ownership allowed Yes Yes Public register of shareholders and directors No No Tax considerations Exempt of corporate tax on profits Yes Yes Annual tax return to be submitted No No Statutory audit required Yes Yes Access to UAE double tax treaties Yes Yes Other considerations Yes No Types of licenses allowed View PDF View PDF Can rent office premises outside free zones No No Allowed to import raw materials? Yes Yes Allowed to export goods? Yes Yes How long to get work permit approved 4 weeks 4 weeks Free zone work permit fee per person 4,950 4,950 Draft invoice View invoice PDF View invoice PDF