Mainland vs free zone: how to choose in 5 questions

The real difference

A standard Dubai mainland licence typically costs about AED 25,000 in government fees. The free zones in my table below cost between AED 4,888 and AED 12,900 in government fees. That gap matters. Still, it is not the main difference.

The main difference is where you can sell. A mainland company is authorised to trade in the UAE local market as well as outside the UAE. A free zone company has limits on selling inside the UAE. I explain those limits below.

Who issues the licence also differs. In Dubai, the Department of Economy and Tourism (DET) licenses mainland companies. Each free zone has its own authority and its own rules.

Here is the full bill for every option on my list.

• Dubai mainland, standard

  Government fee (AED)

  25,000

  My service fee (AED)

  2,500

  Total (AED)

  27,500

• Dubai mainland, restricted activity

  Government fee (AED)

  35,000 to 40,000

  My service fee (AED)

  2,500

  Total (AED)

  37,500 to 42,500

• Sharjah mainland, first year

  Government fee (AED)

  15,000 to 30,000

  My service fee (AED)

  1,000 to 5,000

  Total (AED)

  16,000 to 35,000

• Ajman (ANCFZ) free zone, no visa

  Government fee (AED)

  4,888

  My service fee (AED)

  600

  Total (AED)

  5,488

• Ajman (ANCFZ) free zone, 1 visa

  Government fee (AED)

  10,800

  My service fee (AED)

  1,500

  Total (AED)

  12,300

• RAKEZ

  Government fee (AED)

  6,000

  My service fee (AED)

  1,000 to 5,000

  Total (AED)

  7,000 to 11,000

• SHAMS

  Government fee (AED)

  6,875

  My service fee (AED)

  1,000 to 5,000

  Total (AED)

  7,875 to 11,875

• Meydan free zone, licence only

  Government fee (AED)

  12,520

  My service fee (AED)

  2,500

  Total (AED)

  15,020

• IFZA

  Government fee (AED)

  12,900

  My service fee (AED)

  1,000 to 5,000

  Total (AED)

  13,900 to 17,900

Fee sources, checked 13 October 2026: ANCFZ, RAKEZ, SHAMS, Meydan, SEDD. IFZA and Dubai mainland publish no fixed price, so those rows are typical starting figures from my price list.

For Sharjah mainland, RAKEZ, SHAMS and IFZA, my service fee is AED 1,000 to 5,000, depending on your package. Ask me for your exact number on WhatsApp.

Question 1: who are your customers?

This question decides most cases. If most of your invoices go to people or companies inside the UAE, look at mainland first. If they go abroad, or you sell online to other countries, a free zone is usually enough.

Ownership is no longer the deciding point. Free zone companies can be fully owned by foreign investors. Since 1 June 2021, most mainland companies can be 100% foreign owned too. A few "strategic impact" activities still have extra rules.

Selling to the mainland

Not directly. To sell locally, a free zone company must work through a licensed mainland distributor or open a mainland branch or company. The same u.ae page says direct mainland sales are generally not allowed without mainland licences or approvals.

So a cheap free zone licence can cost you more later, if your buyers are in Dubai. You may pay a distributor, or pay for a branch on top.

What is the Dubai free zone mainland operating permit?

It is a permit that lets some Dubai free zone companies work on the Dubai mainland. It costs AED 5,000 for six months, renewable for the same fee. Kept for a full year, that is AED 10,000.

Read the limits before you count on it:

• It is for eligible free zone companies holding a Dubai Unified Licence. An Ajman, SHAMS or RAKEZ licence is not a Dubai licence.
• The first phase covers non-regulated activities, like technology, consultancy, design, professional services and trading.
• Mainland revenue under the permit is subject to 9% corporate tax, and you keep separate financial records.
• It can open access to government tenders that were reserved for mainland companies.

If you will sell on the mainland every month, compare the permit with a mainland licence. Use the table above for the licence side.

Question 2: how many visas?

In Ajman (ANCFZ), one visa takes the government fee from AED 4,888 to AED 10,800. In Meydan, a first investor visa adds AED 11,600 in government fees if the person is already in the UAE. That includes the company's immigration card, paid once per company and renewed yearly.

That Meydan number is the immigration card (AED 2,000), quota (AED 1,850), investor visa (AED 4,000), and medical and Emirates ID (AED 2,250). It also has the status change (AED 1,500), which applies only if the person is already in the UAE.

Both routes can give you visas. In a free zone, you apply for the work permit and residence visa with the free zone authority. The number of visas depends on the package you buy. On the mainland, private sector work permits are issued by the Ministry of Human Resources and Emiratisation (MOHRE). Mainland visa costs are not on my published list yet, so ask me for them.

Every visa holder also needs an Emirates ID, and a medical test if aged 18 or over.

If you already live here on an employer visa, you may not need a company visa on day one. Check your job contract, and ask your employer about a no-objection letter (NOC). Read starting a business while employed first.

Question 3: what activity will you do?

Your activity can move a Dubai mainland licence from AED 25,000 to AED 35,000 to 40,000 in government fees. Some activities need extra approvals from other government bodies. My fee stays AED 2,500 either way.

Free zones have their own activity lists. Each zone has its own rules and its own authority, so an activity allowed in one zone may not exist in another. Packages also differ. The RAKEZ Basic package allows one activity. The SHAMS standard package lets you choose 5. Ajman (ANCFZ) allows up to 10.

Write down every activity you plan in the next 12 months. Then check which options cover all of them.

Question 4: what is your budget?

If your budget is under AED 27,500 for the first year, mainland in Dubai is out of reach on my list. Ajman (ANCFZ) with no visa is AED 5,488 all in. With one visa, it is AED 12,300.

Roughly, by budget:

• Up to AED 15,020 covers Ajman (ANCFZ) or a Meydan licence only, all in. RAKEZ and SHAMS also fit: AED 7,000 to 11,000 and AED 7,875 to 11,875 all in, with my fee.
• Sharjah mainland is AED 15,000 to 30,000 in government fees for the first year, plus my fee of AED 1,000 to 5,000. That is AED 16,000 to 35,000 all in.
• Dubai mainland, standard, needs AED 27,500 or more.

These are licence numbers. Rent, visas after the first, and renewal come on top. My renewal fee is AED 1,000 a year, plus the government renewal fee set by your authority.

What about corporate tax?

Corporate tax is 0% on taxable income up to AED 375,000, and 9% above that. A free zone company does not pay 0% on everything. To pay 0%, it must meet the conditions for a Qualifying Free Zone Person. Even then, it pays 0% on qualifying income and 9% on other taxable income. Sales to individuals, for example, are usually not qualifying income.

There is also a limit. Non-qualifying revenue must stay within 5% of total revenue or AED 5,000,000, whichever is lower. Go over it, and the company loses the 0% rate for that year and the next four. Your case depends on your numbers, so check with a registered tax advisor.

Question 5: office and bank

On the mainland, yes, you need a real address. u.ae says all UAE businesses must have a physical address, and a rental agreement must be provided. In Dubai, the lease is registered with Ejari. Rent is not in the licence fee.

Free zone packages often include a workspace. ANCFZ lists a lease agreement. SHAMS lists a flexi-desk. RAKEZ Basic gives access to a co-working facility. If you need a real office for staff, that costs extra in any zone.

For the bank, the bank decides, not me and not the free zone. Expect it to ask what you do, where your customers are, and where you work. Clear answers and matching documents help. My bank account help is from AED 2,000, and it does not promise approval. Read corporate bank account in UAE before you apply.

So which one should I pick?

Pick the cheapest option that passes all five questions. For many people that is a free zone. For people selling to UAE companies every day, it is usually mainland.

• Sell mostly abroad or online, small budget

  Look at first

  Ajman (ANCFZ), RAKEZ or SHAMS

• Need a Dubai address and a visa

  Look at first

  Meydan or IFZA

• Sell to UAE customers every month

  Look at first

  Dubai mainland or Sharjah mainland

• Hold a Dubai free zone licence and sell on the mainland now and then

  Look at first

  Check the Dubai mainland operating permit

• Have a restricted activity

  Look at first

  Dubai mainland, restricted, after checking approvals

See the mainland setup page and the free zone setup page, or compare jurisdictions side by side. For the full cost list, read my Dubai business setup cost breakdown. If a free zone wins, see the cheapest free zone comparison.

Still not sure

Run your options through the cost calculator to see your exact numbers. Still stuck? Tell me what you sell and who buys it on WhatsApp. My business setup service starts with that question.

This is general information, not tax or legal advice. For your personal case, speak to a registered tax advisor.