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Free Zone vs Mainland Company in Dubai – Which One Should You Choose?

When starting a business in Dubai, one of the most important decisions you must make is whether to form a Free Zone company or a Mainland (LLC) company. Both come with their own advantages depending on your business goals.

This guide breaks down the key differences to help you make the best choice.

1. Ownership Structure

Free Zone Company

  • 100% foreign ownership
  • No UAE national needed
  • Ideal for expatriates and international entrepreneurs

Mainland Company

  • Some activities may require a UAE national
  • Full access to Dubai and UAE market

2. Business Activities & Market Access

Free Zone

  • Allowed to operate within the Free Zone and internationally
  • Cannot trade directly in the UAE mainland without a local distributor

Mainland

  • Can operate anywhere in the UAE without restrictions
  • Perfect for retail, restaurants, trading companies, and service providers targeting Dubai customers

3. Taxation

Free Zone

  • 0% corporate tax for qualifying income
  • No import/export duties
  • Lower ongoing costs

Mainland

  • Subject to UAE corporate tax based on activity and income
  • VAT applies normally

Learn about Corporate Tax Filing in Dubai.

4. Cost of Setup

Free Zone Company

  • Lower setup fees
  • Flexi-desk and shared office options
  • Cheaper visa quotas

Mainland Company

  • Higher licensing costs
  • Office tenancy often mandatory
  • Ideal for those needing a physical presence

5. Licensing & Office Requirements

Free Zone

  • No mandatory office for some zones
  • Quick digital processing

Mainland

  • Physical office required
  • More compliance steps
  • Wider approval requirements

Which One Should You Choose?

Choose Free Zone if you:
✔ Want 100% ownership
✔ Trade internationally
✔ Want lower setup costs
✔ Need fast setup

Choose Mainland if you:
✔ Want to trade anywhere in UAE
✔ Run a customer-facing business
✔ Need unlimited visa quotas
✔ Want more business flexibility

Final Thoughts

Both Free Zone and Mainland setups are excellent options depending on your business model. Dubai provides strong support to entrepreneurs in both sectors. Explore how Profits Plus can assist you here:
Business Setup in Dubai

Professional support for your business.


ProfitsPlus simplifies accounting and tax with British professionalism and UAE expertise. With 20+ years of experience, we give business owners clarity, confidence, and the freedom to focus on growth.

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