If you’re thinking about opening a company in the UAE, you’ve probably seen these two terms over and over:

Free Zone vs Mainland

But what do they actually mean — and which one makes sense for your business?

At Evolve Tax UAE, we help UK and global entrepreneurs choose the right path for their tax strategy, growth, and compliance goals. Here’s the simple breakdown 👇

What’s a Free Zone Company?

A Free Zone company is registered in a special business district designed to attract international investors. There are over 40 Free Zones across the UAE.

Pros

• 0% UAE corporate tax (if income qualifies)
• 100% foreign ownership (no local partner needed)
• Fast setup (as little as 5–7 working days)
• Easy to repatriate profits
• Business-friendly regulation

Cons

• Cannot trade directly with the UAE mainland unless you work with a local distributor
• Some Free Zones are industry-specific

Best for:

• Consultants, ecommerce, online service businesses, international trade, holding companies

What’s a Mainland Company?

A Mainland company is registered with the UAE government (Department of Economic Development) and allows you to do business anywhere in the UAE and internationally.

Pros

• Can trade directly within the UAE market
• Access to local government tenders
• No restrictions on business activities
• More credibility with UAE banks and clients

Cons

• Corporate tax may apply (depending on activity & income)
• Slightly more complex setup
• In some cases, a UAE national sponsor or agent is still required

Best for:

• Brick-and-mortar businesses, construction, real estate, local logistics, UAE B2B service firms

What About Tax?

Free Zones can qualify for 0% corporate tax, but only if:

• Your income is non-UAE sourced
• You’re a Qualified Free Zone Person under FTA rules

Mainland companies are taxed at 9% on profits over AED 375,000 — unless part of a group with special exemptions.

That’s why your strategy matters — and it’s where we come in.

Which Should You Choose?

Here’s a quick comparison:

Bonus: Evolve Tax VIP Setup

Whichever route you choose, we make it smooth:

• Airport pickup (Range Rover style)
• Help with medicals, biometrics, SIM, license
• White-glove paperwork done for you
• Optional tours of Dubai and Abu Dhabi

Let’s Help You Choose Wisely

There’s no “one-size-fits-all” — but there is a best-fit solution for your business and tax goals.

Book a free 15-min strategy call: Book Now

Chat with us on WhatsApp: Message Us

Let’s help you set up in the UAE — the smart way.