We often hear about the magical growth of UAE business infrastructures and the immense growth of investors in UAE. But should you start your company in the Dubai Free Zone?
The UAE offers two types of licenses: mainland or free zone. In today’s guide, we will share the ultimate reasons why you should start your company in the Dubai-free zone. In a deeper dive, you will also get to the essential steps you need to take to start your business in the Dubai-free zone.
So, let’s dig in!
What is a Free Zone in Dubai?
A Dubai Free Zone is a designated economic area within Dubai that operates under rules different from the mainland. These zones are self-contained business hubs that offer several advantages to businesses, especially those with foreign ownership.
There are over 20 Free Zones in Dubai, each with its focus area. Some popular ones include:
- Jebel Ali Free Zone (JAFZA): General trade and logistics
- Dubai International Financial Centre (DIFC): Financial services
- Dubai Internet City (DIC): Technology and communications
- Dubai Media City (DMC): Media and entertainment
So, exploring the Free Zone options can be very beneficial if you’re considering setting up a business in Dubai, especially if you’re a foreign investor.
Want to know how?
Keep reading as we share some of the exquisite reasons you should start your company in the Free zone.
Why Should You Start Your Company in the Dubai Free Zone?
1. Tax Benefits
The first reason why you should start your company in the Dubai Free Zone is that it offers significant tax incentives. That’s also the main reason why it attracts entrepreneurs. These zones are tax-free and do not impose personal income tax. It means, individuals can retain all their earnings without any deductions.
In addition, businesses operating in these zones are also exempted from corporate taxes over a significant period ranging from 15 to 50 years. This tax relief not only results in substantial savings but improved profitability as well.
Free Zones are also exempt from Value Added Tax. This is a great benefit for businesses in the trade and service industries.
2. 100% Foreign Ownership
Unlike, the mainland where a local sponsor or partner is required to hold at least 51% shares of the company Dubai Free Zones are different. It allows 100% foreign ownership. Entrepreneurs from around the globe can now fully control and own their businesses, without needing to share equity.
This ownership allows for complete autonomy in business operations and decisions, which is an important advantage for foreign investors who want to establish a presence. It also gives foreign investors the ability to make business decisions independently.
3. Diverse Business Activities
Dubai’s Free Zones are a great place to do business. They cater to all types of companies. There is a Dubai Free Zone for every kind of business, whether it is in technology, manufacturing, media, or services. This flexibility allows companies to operate in an environment that is tailored to the needs of their industry, with regulations and services to support their activities.
4. Easy Registration and Setup Process
Most importantly, Dubai Free Zones have been designed for ease of use and efficiency. Registration and licensing procedures are often simplified with minimal paperwork compared to other jurisdictions. Entrepreneurs can start operations earlier because of faster approval times. Many Free Zones have dedicated support staff to help investors with the setup process. This includes legal requirements, paperwork, and administrative tasks.
5. Duty-free imports
The good news is businesses that operate in Dubai free zones are exempted from import and/or export duties. This significantly reduces costs for importing raw materials or exporting finished products. It also reduces the costs of trading internationally and increases the competitiveness of products and services. Savings on customs fees can have a significant impact on the profitability of manufacturing and trading businesses.
6. Access to the latest infrastructure
The world-class infrastructure of Dubai offers well-equipped offices, high-quality warehouses, storage facilities, and advanced logistics and transport networks. The availability of this infrastructure ensures businesses can operate efficiently and effectively with the resources they require to thrive. In addition, many Free Zones invest in continuously improving their facilities to ensure that companies have access to modern technologies and infrastructure.
7. Strategic Location
The geographical location of Dubai makes it the ideal hub for businesses that want to access markets throughout Europe, Asia, or Africa. It provides easy access to international markets through its airports and ports. Dubai is a great destination for international businesses because of its strategic advantage. This allows companies to operate in an environment that is highly connected and dynamic and has a large global customer base.
8. 100% Profit Repatriation
Do you know that profits and capital can be repatriated 100% in Dubai Free Zones? Well, it’s true, and there are major financial benefits to setting up a business in Dubai. It means that owners of companies can transfer their earnings to their home countries without restrictions or additional tax. This financial freedom provides investors with economic security, as their profits will be fully remitted to them without any local taxes being deducted.
9. Flexibility in business operations
Dubai Free Zones are renowned for their flexibility. Entrepreneurs can select from a range of office solutions – from virtual offices up to large industrial units – depending on their needs and budget. The Free Zones also offer customized business packages, which can be tailored for different business models. Companies of all sizes will find a suitable set-up. Flexibility extends to the visa options. The streamlined visa processes make it easier for companies to hire and manage their staff.
10. Expat Entrepreneurs are Increasing in Number
The matchless benefit of setting up a business in Dubai Free Zone is its growing expat community. It offers countless networking opportunities for new business owners to meet like-minded people and potential partners. Moreover, the presence of a supportive ecosystem, including access to mentoring, business support services, and funding opportunities, makes Dubai an attractive destination for entrepreneurs from around the world.
Get Help From Ignite Zone?
In conclusion, Free Zone can be an attractive spot to start your dream business in Dubai. Some of its exquisite reasons are mentioned above. However, if you still need clarification and are looking for some guidance on how you can set up your business in the Dubai Free Zone, we are here to help you.
From choosing an ideal business-free zone to the business setup, we can handle it all. For the rest, you can focus on growing your business, which matters the most.
Contact us Today for FREE Consultancy and start your dream business in Dubai.
