Free Zone Business Setup

UAE Free Zone Company Setup 2026: Costs, Process & Top Free Zones Compared

100% foreign ownership. 0% personal income tax. Licences issued in 3–7 days. Affinitas DMCC sets up Free Zone companies across 40+ UAE jurisdictions — end to end.

45+ Operational UAE Free Zones · 3–7 Business days to licence · 0% Personal income tax · 68,000+ New FZ licences issued in 2025

⚠ Corporate Tax 2026: All UAE Free Zone companies — including those at 0% qualifying rate — must register with the FTA . Late registration: AED 10,000 penalty . Affinitas handles registration as part of your setup package.

What Is a UAE Free Zone?

A UAE Free Zone is a designated economic area where businesses operate under a specific regulatory framework — separate from the UAE mainland — with a distinct set of tax, ownership, and licensing rules designed to attract international capital and talent.

100% Foreign Ownership: Free Zone companies are entirely foreign-owned with no requirement for a UAE national shareholder or local sponsor.

0% Personal Income Tax: Owners and employees pay no personal income tax on salaries, dividends, or investment returns in the UAE.

0% Corporate Tax on Qualifying Income: Free Zone entities meeting QFZP conditions pay 0% Corporate Tax on Qualifying Income. This requires substance, correct activity classification, and FTA registration.

Full Profit Repatriation: 100% of profits and capital can be repatriated to your home country with no restrictions on currency transfers.

Fast Licensing: 3–7 Days: Most Free Zones issue trade licences within 3 to 7 business days for complete applications. No lengthy government approvals required.

Customs Duty Exemption: Goods imported into and exported from a UAE Free Zone are exempt from customs duties, making them ideal for international trading operations.

Free Zone & Corporate Tax: What Changed and What You Must Do Now

The introduction of UAE Federal Corporate Tax in June 2023 fundamentally changed the Free Zone landscape. The widespread assumption that Free Zone status automatically means 0% tax is no longer accurate.

What the 0% Rate Actually Requires

Qualifying Free Zone Person (QFZP) Status

To benefit from the 0% Corporate Tax rate on Qualifying Income, your Free Zone entity must meet all of the following conditions under the UAE CT Law (Federal Decree-Law No. 47 of 2022):

• Maintain adequate substance in the UAE (staff, premises, decision-making)
• Earn income exclusively or predominantly from Qualifying Activities
• Not elect out of the QFZP regime
• Not generate significant non-qualifying income (de minimis threshold applies)
• Comply with transfer pricing rules for related-party transactions
• Register with the FTA and file annual CT returns — regardless of tax position

Non-qualifying income — including most income from UAE mainland clients — is taxed at 9%. Affinitas assesses your QFZP eligibility as part of every setup engagement.

New in 2025–2026

DMCC Redomiciliation Rules — Expanded Options

Following regulatory changes in late 2025, DMCC introduced simplified redomiciliation rules that allow established foreign companies to migrate their legal domicile directly into DMCC — preserving their legal identity, contracts, and banking history.

• Transfer existing company into DMCC without dissolving the original entity
• Retain existing contracts, IP ownership, and banking relationships
• Access DMCC's regulatory environment and 0% QFZP regime from day one
• Particularly relevant for UK, EU, and GCC companies seeking UAE tax residency
• Affinitas is the first registered DMCC SPV Agent and manages redomiciliation end-to-end

UAE's Leading Free Zones: Which Is Right for Your Business?

The UAE has 45+ operational Free Zones. The right choice depends on your activity, budget, visa requirements, and corporate tax strategy. Here are the most widely used by Affinitas clients.

The world's most awarded Free Zone and the UAE's largest by company count. Preferred for commodities trading, financial services, technology, and international holding structures. Affinitas is the first registered DMCC SPV Agent.

Operates under English common law with its own independent regulator (DFSA). The preferred jurisdiction for financial services, family offices, fintech, and Prescribed Companies. Higher cost; highest regulatory prestige.

One of the most cost-effective options for general trading, consulting, technology, and e-commerce. Fast processing and flexible activity lists make it popular for new market entrants and SMEs.

One of the UAE's largest multi-sector Free Zones. Strong for manufacturing, industrial activities, e-commerce, and education. Competitive pricing with warehouse and land options. Popular in Sharjah for its low-cost packages.

The most affordable Free Zone for media, content creation, consulting, and freelance professionals. No physical office required. Popular with digital nomads, influencers, and solo operators entering the UAE market.

One of the oldest and largest Free Zones in the world, located adjacent to Jebel Ali Port — the world's ninth-busiest. The preferred choice for logistics, shipping, warehousing, and physical goods trading.

Abu Dhabi's international financial centre, operating under English common law. Preferred for wealth management, asset management, family offices, and investment funds headquartered in Abu Dhabi.

Dubai Silicon Oasis and Dubai Internet City are the go-to Free Zones for technology companies, software developers, cybersecurity firms, and digital media businesses seeking a dedicated tech ecosystem.

UAE Free Zone Setup Costs Compared (2026)

Indicative costs based on a single-activity licence with one visa. Actual costs depend on activity type, number of visas, and office package selected.

Costs are indicative as of mid-2026 and subject to Free Zone authority changes. All costs are annual and exclude visa fees, medical costs, Emirates ID, and bank account charges. Contact Affinitas DMCC for a precise quote for your specific activity and requirements.

Free Zone vs Mainland vs Offshore: Which Structure Fits Your Goals?

The three principal UAE business structures serve different purposes. Choosing incorrectly at formation can result in costly restructuring later.

Key decision point: If your primary client base is inside the UAE mainland — retailers, contractors, government entities — a Free Zone structure alone will limit you. Affinitas assesses your market access needs before recommending a structure, so you are not forced to restructure six months after launch.

How to Set Up a Free Zone Company in the UAE: Step by Step

Affinitas manages the entire process on your behalf — from Free Zone selection through to Corporate Tax registration. Most Free Zone licences are issued within 3 to 7 business days.

Select the Right Free Zone: Affinitas matches your activity, market access requirements, budget, and visa needs to the optimal Free Zone from 45+ options — before you commit to anything.

Choose Your Structure: Free Zone Establishment (FZE) for a single shareholder, or Free Zone Company (FZC) for multiple shareholders. Affinitas confirms which structure suits your ownership and governance needs.

Reserve Company Name: Submit three name options to the Free Zone authority. Names must comply with UAE naming conventions. Affinitas prepares the submission and handles any queries from the authority.

Submit Documents: Passport copies of all shareholders, proof of address, business plan, and any activity-specific documents. Affinitas reviews every document before submission to prevent delays.

Select Office Space: Flexi desk, shared office, private office, or warehouse — depending on your activity, visa requirements, and budget. Affinitas advises on the minimum office requirement for your chosen activity.

Receive Trade Licence: Most Free Zones issue licences within 3 to 7 business days of a complete submission. Affinitas tracks progress and liaises with the authority throughout.

Apply for Residence Visas: Sponsor your own UAE residence visa, family dependants, and employees through the Free Zone. Affinitas manages the visa application, medical, and Emirates ID process.

Open a UAE Bank Account: Affinitas introduces you to UAE banking partners and assists with the account opening documentation. See our bank account opening service .

Register for Corporate Tax: All UAE entities must register with the FTA. Affinitas handles Corporate Tax registration , advises on QFZP eligibility, and sets up your CT filing framework from day one.

Documents Required for UAE Free Zone Company Formation

Requirements vary slightly by Free Zone and shareholder type. The core documents below apply to all standard applications.

Why Businesses Choose Affinitas DMCC for Free Zone Setup

We work across 40+ UAE Free Zones and have been operating in DMCC since 2014. Every client works directly with a senior adviser, not a junior administrator.

First Registered DMCC SPV Agent: Affinitas holds the distinction of being the first firm officially nominated by DMCC to incorporate Special Purpose Vehicles — a credential reflecting the deepest structural expertise available in the market.

40+ Free Zones Covered: From SHAMS to DIFC to ADGM — Affinitas works across every major UAE jurisdiction and recommends the right one based on your goals, not on commercial preference.

CT-Integrated Advice from Day One: Every setup engagement includes a QFZP eligibility assessment and Corporate Tax registration . You are not left to discover your tax position after launch.

English & Russian Speaking Team: Our advisers work fluently in English and Russian. In-person meetings available at our Fortune Tower, JLT office.

Full Lifecycle Support: Formation, visas, bank account, accounting , VAT registration , transfer pricing , annual licence renewal — one team handles every stage of your UAE business lifecycle.

Remote Setup Available: Most Free Zone formations can be completed without you visiting the UAE. Affinitas manages the entire process remotely and coordinates your UAE arrival only when required.

Frequently Asked Questions: UAE Free Zone Company Setup 2026

How much does it cost to set up a Free Zone company in the UAE in 2026?

Setup costs vary significantly by Free Zone. Basic packages in affordable Free Zones like SHAMS or IFZA start from approximately AED 10,000–15,000 per year (licence + one visa). DMCC starts from approximately AED 19,500–25,000. DIFC and ADGM start from AED 40,000+. All figures exclude visa fees, medical costs, Emirates ID charges, and bank account costs. Contact Affinitas DMCC for a precise quote based on your specific activity and requirements.

Can a Free Zone company trade with UAE mainland clients?

Not directly. Free Zone companies cannot sell goods or provide services to UAE mainland clients without using a mainland-registered distributor or agent, or without also holding a mainland trade licence. If your primary client base is within the UAE mainland, a mainland LLC structure is required. Affinitas advises on the optimal structure for your market access needs before any registration takes place.

Do Free Zone companies pay Corporate Tax in the UAE?

This is the most misunderstood aspect of the UAE Free Zone landscape in 2026. The 0% Corporate Tax rate is not automatic — it applies only to entities that qualify as a Qualifying Free Zone Person (QFZP) under the UAE CT Law. QFZP status requires demonstrating adequate UAE substance, earning income from Qualifying Activities only, and meeting ongoing compliance conditions. Non-qualifying income is taxed at 9%. All Free Zone companies must register with the FTA regardless of their tax position. See our corporate tax registration page for details.

What is the difference between an FZE and an FZC?

A Free Zone Establishment (FZE) is a single-shareholder entity — one person owns 100% of the company. A Free Zone Company (FZC) allows between 2 and 5 shareholders. Both structures offer 100% foreign ownership, the same licensing options, and the same tax treatment. The choice depends on your ownership structure and governance preferences.

Which is the best Free Zone in Dubai for a trading company?

For commodities and international trading, DMCC is the world's most awarded Free Zone and the first choice for serious trading operations. For general trading at lower cost, IFZA offers a strong combination of flexibility and affordability. For logistics and physical goods, JAFZA's proximity to Jebel Ali Port makes it the preferred option. Affinitas selects the right Free Zone based on your specific commodity, trade routes, and client base.

How long does UAE Free Zone company formation take?

Most Free Zones issue licences within 3 to 7 business days of a complete application submission. Free Zones with more complex regulatory requirements — such as DIFC, ADGM, or activities requiring government approvals — typically take 2 to 4 weeks. Affinitas prepares every application to be complete on first submission, minimising processing delays.

Do I need to be in the UAE to set up a Free Zone company?

No. Most Free Zone companies can be incorporated entirely remotely. Affinitas manages the full process on your behalf. A UAE visit is typically required only for the medical test and Emirates ID biometrics if you wish to obtain a UAE residence visa through the company. If no visa is required, the entire process can be completed without visiting the UAE.

Can I move my existing foreign company into a UAE Free Zone?

Yes — through a process called redomiciliation (corporate migration). This allows you to transfer your company's legal domicile into a UAE Free Zone such as DMCC while preserving its legal identity, contracts, banking history, and trading relationships. It is particularly relevant for UK, EU, and GCC businesses seeking UAE tax residency without building a new entity from scratch. Affinitas manages the full redomiciliation process. See our redomiciliation guide for details.

Ready to Set Up Your UAE Free Zone Company?

One conversation with an Affinitas adviser identifies the right Free Zone, confirms your Corporate Tax position, and maps the fastest compliant path to launch. No obligation. No generic answers.

Disclaimer: The information on this page is provided for general guidance only and does not constitute legal, tax, or regulatory advice. UAE Free Zone fees, Corporate Tax thresholds, QFZP eligibility conditions, and regulatory requirements are subject to change by the relevant Free Zone authorities and the Federal Tax Authority. Cost figures are indicative as of mid-2026. The 0% Corporate Tax rate on Qualifying Income is subject to conditions under Federal Decree-Law No. 47 of 2022 and related ministerial decisions. Affinitas DMCC recommends obtaining professional advice specific to your business circumstances before proceeding with any company formation or tax registration. Affinitas DMCC is a business setup and advisory firm and does not provide legal representation.