Free Zone vs Mainland Company: Real Cost Comparison 2026
Free zone setup starts at AED 5,500 with 0 percent tax up to 375K. Mainland costs more but allows local market sales. Here is the breakdown.
Quick answer
Free zone company setup in 2026 costs AED 12,000–18,000 for a single visa, while mainland costs AED 20,000–28,000. Free zones offer 0% tax on profits up to AED 375,000, 100% foreign ownership, and fast digital setup. Mainland companies pay 9% corporate tax on profits over AED 375,000 and require a local service agent in some activities. Free zones restrict direct sales to the UAE mainland unless you appoint a distributor, while mainland setups allow unrestricted local sales. Choose free zone if you serve mainly export markets; choose mainland if you need full access to UAE customers.
Free zone setup costs 2026
Most popular free zones publish flat packages that include license, visa, and stamp duty. Below are current rates for a single-shareholder LLC with one residence visa.
DMCC
AED 15,500 base package covers 1-year license, 1 visa, medical fitness, Emirates ID, and typing. Extra visa costs AED 3,500. No local service agent fee.
IFZA
AED 12,000–14,000 for basic 1-year license + 1 visa. Extra visa AED 3,000. 3-year license option saves 15%.
JAFZA
AED 17,000–19,000 basic package. Extra visa AED 4,000. Includes warehouse inspection fee if you choose activity requiring storage.
RAS AL KHAIMAH FREE ZONE
AED 12,500 for 1-year license + 1 visa. Extra visa AED 3,200. 3-year package at AED 31,000 gives lowest per-year cost.
Mainland setup costs 2026
Setup through DED-approved centers requires 9% corporate tax registration and possible local service agent contract.
Standard mainland LLC
AED 20,000–25,000 includes DED license, 1 visa, typing, medical, Emirates ID, and 100% foreign ownership approval. Local service agent fee ranges from AED 8,000–15,000 per year for restricted activities.
Professional services firm
AED 15,000–18,000 for DED license with no local service agent requirement. Extra visa AED 3,500.
Tax obligations 2026
Free zone companies follow Cabinet Decision No. 55 of 2023 and keep 0% tax rate on qualifying income up to AED 375,000. Profits above this threshold pay 9%.
Free zone vs mainland tax
Free zone qualifying income stays exempt from 9% tax until it exceeds AED 375,000. Mainland companies pay 9% directly on profits over AED 375,000. Both structures require annual audited accounts submission to FTA.
Market access restrictions
Free zone licenses limit direct sales to the UAE local market. You must use a mainland distributor or open a branch office to serve UAE customers.
Free zone sales channels
Free zones allow 100% export sales and online sales outside UAE. Through online channels you can reach UAE customers without extra license.
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