Cross-border comparison
UAE (Dubai Mainland) vs UAE (RAKEZ Free Zone): Where Should You Incorporate in 2026?
A side-by-side analysis of cost, tax, banking, privacy, and remote formation for UAE (Dubai Mainland) (LLC) vs UAE (RAKEZ Free Zone) (Free Zone LLC).
The numbers, side by side
| UAE (Dubai Mainland) | UAE (RAKEZ Free Zone) | |
|---|---|---|
| Entity type | LLC | Free Zone LLC |
| Region | Middle East | Middle East |
| Filing fee (one-off) | $4,500 | $3,200 |
| Annual fee | $4,000 | $2,800 |
| Registered agent / corp sec | Not required | Not required |
| Headline corporate tax | 9% | 9% |
| Effective tax note | 0% on profits ≤ AED 375k. 9% above. Small Business Relief up to AED 3M revenue. | 0% on qualifying free zone income up to AED 3M (Small Business Relief). 9% on profits > AED 375k otherwise. |
| VAT / GST | 5% | 5% |
| Minimum paid-up capital | $0 | $0 |
| Processing time | 14 days | 14 days |
| Remote formation | ||
| Banking accessibility | 8/10 | 7/10 |
| Privacy score | 5/10 | 6/10 |
| UBO register public | ||
| Stripe available | ||
| PayPal Business | ||
| Wise Business |
UAE (Dubai Mainland): when it wins
- Can trade onshore UAE
- No restrictions on local market
Trade-offs
- Higher cost than free zones
- In-person setup typical
100% foreign ownership now allowed in mainland since 2021.
UAE (RAKEZ Free Zone): when it wins
- Effective 0% for qualifying free zone activity
- No personal income tax
- UAE Golden Visa eligibility
Trade-offs
- High setup cost ($3k+)
- Substance requirements
- Bank opening requires visit
RAKEZ is one of the cheapest free zones. IFZA and SHAMS are similar. CT introduced 2023 at 9%.
Decision framework
- Want the cheapest setup? Compare year-1 totals: UAE (Dubai Mainland) $8,500 vs UAE (RAKEZ Free Zone) $6,000.
- Want the lowest tax? Look at effective rate, not headline. 9% in UAE (Dubai Mainland) vs 9% in UAE (RAKEZ Free Zone); check both effective-tax notes above for exemptions.
- Need Stripe + Wise + Mercury? UAE (Dubai Mainland) payments stack: Stripe ✅, Wise ❌. UAE (RAKEZ Free Zone): Stripe ✅, Wise ❌.
- Privacy is critical? UAE (Dubai Mainland) (5/10, UBO private) vs UAE (RAKEZ Free Zone) (6/10, UBO private).
- Forming remotely? UAE (Dubai Mainland): in-person required. UAE (RAKEZ Free Zone): fully remote.
Frequently asked questions
Which is cheaper to form, UAE (Dubai Mainland) or UAE (RAKEZ Free Zone)?
UAE (RAKEZ Free Zone) is cheaper: ~$6,000 year-1 vs ~$8,500 for UAE (Dubai Mainland).
Which has lower corporate tax, UAE (Dubai Mainland) or UAE (RAKEZ Free Zone)?
UAE (RAKEZ Free Zone) has the lower headline rate at 9% vs 9% in UAE (Dubai Mainland). 0% on qualifying free zone income up to AED 3M (Small Business Relief). 9% on profits > AED 375k otherwise.
Can I open a Stripe account in both UAE (Dubai Mainland) and UAE (RAKEZ Free Zone)?
Stripe in UAE (Dubai Mainland): ✅ supported. Stripe in UAE (RAKEZ Free Zone): ✅ supported.
Is remote formation possible?
UAE (Dubai Mainland): In-person presence usually required. UAE (RAKEZ Free Zone): Yes, fully remote.
What about privacy of beneficial owners?
UAE (Dubai Mainland)'s UBO register is private and privacy scored 5/10. UAE (RAKEZ Free Zone)'s UBO register is private and privacy scored 6/10.