Choosing between mainland and free zone setup affects your tax treatment, market access, and compliance obligations.
Mainland companies can trade directly across the UAE and internationally, are subject to the standard 9% Corporate Tax above the threshold, and register for VAT under standard rules.
Free zone companies benefit from 100% foreign ownership (also now available on mainland for most activities) and may qualify for 0% Corporate Tax on "qualifying income" as a Qualifying Free Zone Person — but must meet substance requirements and generally can't freely trade with the mainland without additional registration.
Once registered, businesses need to maintain proper accounting records, file VAT returns (typically quarterly), and file an annual Corporate Tax return within 9 months of their financial year-end.
Free zone rules and qualifying income criteria are detailed and specific to each free zone. Consult a business setup consultant or tax advisor before choosing your structure.