Choosing between a mainland and a free zone company is the first big decision when you set up in the UAE. Both allow full foreign ownership for most activities today, but they suit different businesses.
Mainland companies
A mainland company is licensed by the economic department of an emirate (for example, the Department of Economy & Tourism in Dubai).
- Trade anywhere in the UAE, including directly with the local market and government entities.
- Flexible office locations across the emirate.
- Visa allocation is usually linked to your office space.
Mainland suits retailers, service businesses serving UAE consumers, and companies bidding for local contracts.
Free zone companies
The UAE has dozens of free zones, each with its own authority, rules and price points.
- 100% foreign ownership and simple setup.
- Ideal for international trade, consulting, tech and ecommerce.
- Trading directly into the mainland market usually requires a local distributor or an additional licence.
- Flexible packages, from flexi-desks to full offices.
Tax at a glance
The UAE introduced federal corporate tax in 2023, with a standard rate of 9% on taxable profits above a threshold and special treatment available for qualifying free zone income. VAT is charged at 5%, with registration mandatory above a turnover threshold. Rules and thresholds are updated from time to time, so we confirm the current position with you.
How to choose
Ask yourself three questions:
- Where are my customers? Mostly in the UAE → mainland. Mostly international → free zone.
- How many visas will I need? This affects office size and cost.
- What activities will I carry out? Some activities are only available in certain jurisdictions.
Our UAE branch compares options for your exact activity and budget before you commit. Talk to us on WhatsApp or start your UAE setup.
