There are many good reasons why opening a business in an UAE free zone is more convenient than in the mainland.
Enjoying the full company ownership, complete corporate and personal income tax exemption, full repatriation of capital and profits and zero taxes on import and export, are some of the specific benefits of the free zones in the UAE.
In twenty of these free zones there is one more advantage that will definitely affect the decision of many companies (new and existing) on where it is better to establish their business in the UAE.
The Federal Tax Authority (FTA) has, indeed, designated twenty free zones in the UAE that will be exempt from the application of the Value Added Tax (VAT), which came into effect in the country starting from January 1st, 2018.
Those free zones are specifically located in proximity of port, airport, industrial areas and they will benefit of the tax exemption to ease the trade and industrial activities.
According to the UAE’s VAT law, goods may be also transferred between designated zones without being subject to the VAT if they are not used or altered during the transfer process, proven that the transfer is undertaken in compliance with the rules for customs suspension for GCC Common Customs Law.
The list of the UAE free zones exempt from VAT is as follows:
Free Trade Zone of Khalifa Port
Abu Dhabi Airport Free Zone
Khalifa Industrial Zone
Jebel Ali Free Zone
Dubai Cars and Automotive Zone (DUCAMZ)
Dubai Textile City
Free Zone Area in Al Quoz
Free Zone Area in Al Qusais
Dubai Aviation City
Dubai Airport Free Zone
Hamriyah Free Zone
Sharjah Airport International Free Zone
Ajman Free Zone
Umm Al Quwain
Umm Al Quwain Free Trade Zone in Ahmed Bin Rashid Port
Umm Al Quwain Free Trade Zone on Sheikh Mohammed bin Zayed Road
Ras Al Khaimah
RAK Free Trade Zone
RAK Maritime City Free Zone
RAK Airport Free Zone
Fujairah Free Zone
Fujairah Oil Industry Zone (FOIZ)
Planning to setup a business in UAE free zones? Get an initial free consultation by writing to email@example.com
Mara Di Marco
General Manager, UAEstablishment