Many entrepreneurs hesitate to set up their business in free zones due to the misconceptions that surround them. Let’s clear up some of the most common myths and reveal the facts about Dubai free zone business setup.
1: Free Zones Are Only for Big Corporations:
Some believe free zones are only for large multinational companies. The truth? Free zones cater to businesses of all sizes, including startups and SMEs. Many free zones offer affordable packages, flexible office spaces, and even virtual licenses for small businesses and freelancers.
2: You Need a Local Sponsor to Own a Free Zone Business:
A common misconception is that foreign entrepreneurs must have a local partner. In reality, most free zones allow 100% foreign ownership, meaning you can fully own your company without sharing profits or control with a sponsor.
3: Free Zone Companies Can’t Do Business Outside the Free Zone:
Some think free zone businesses are restricted to operating only within the zone. While free zone companies primarily serve international markets, many can also trade locally by obtaining a dual license or working with a local distributor.
4: Setting Up in a Free Zone Is Too Expensive:
People often assume free zones are costly, but many offer budget-friendly options. Costs depend on the type of license, office space, and services needed. Some free zones even provide low-cost flexi-desks and startup-friendly packages.
5: Free Zone Visas Are Difficult to Get:
Another myth is that getting employee visas in a free zone is complicated. In truth, the process is straightforward, and free zones often provide dedicated visa support to help with applications, medical tests, and Emirates ID processing.
6: Free Zone Businesses Pay Hidden Taxes:
Some worry about unexpected taxes, but free zones offer 0% corporate and personal income tax. While VAT may apply in certain cases, most free zone businesses enjoy full tax exemptions on profits and imports/exports.
7: Free Zones Have Limited Banking Options:
A misconception is that opening a business bank account is hard in free zones. Most major UAE banks support free zone companies, and some free zones even have on-site banking facilities for easier transactions.
Free zones are designed to make business setup easy, fast, and cost-effective. By separating myths from facts, entrepreneurs can make informed decisions and take full advantage of the benefits free zones offer. Whether you’re a freelancer, startup, or established company, there’s likely a free zone that fits your needs perfectly.