Free zones are commercial hubs where products and services can be exchanged. These areas are also referred to as free trade zones or a free zone authority. Zero percent tax rates, favorable customs duty rates, and a complete exemption from import and export taxes are all benefits of free trade zones.
Particularly favored by businesspeople who value their privacy are free zones. This is due to the corporation having 100% foreign ownership and not having a public directory of its information. 100% foreign ownership implies that private corporate information, such as shareholder information, is never made public.
The free zones in the UAE have developed through time to provide firms operating there with ever-increasing benefits. The International Free Zone Authority oversees free zones, which aid in regional integration between cities and emirates (IFZA). Companies outside of the free zone can interact with and conduct business with foreign companies.
Why choose a freezone?
- SIMPLE SETUP
A free zone authority can be established in a very simple manner. The exact course of action will depend on your chosen zone and line of business. In many instances, providing some basic documentation is the sole important need.
- OVERSEAS OWNERSHIP
Foreign company ownership is a significant benefit of opening up trade in a free zone. Most foreign business owners who want to establish themselves on the UAE’s mainland must collaborate with a local partner to carry out their line of activity. This regulation does not apply to the free zones in the UAE. Once a business is established in a free zone establishment, the proprietor retains full ownership.
- TRADES WITHIN THE UAE
The ban on direct trading within the UAE’s domestic market is one of the rules that businesses operating in free zones there are required to follow. Fortunately, this obstacle is easily overcome after significant networks have been established with investors in your sector.
- TAXES AND DUTIES
Tax exemptions are arguably the strongest argument in favor of choosing a free zone. Establish your business in a free zone to enjoy 0% corporation and personal tax as well as VAT exemption for your line of work. VAT is now fixed at 5% and is applicable to all products and services in Dubai and the surrounding area. Profits and money can be fully repatriated in free zones as well.