Cheapest Free Zone in UAE | Affordable Business Setup 2025

Cheapest Free Zone in UAE: The Ultimate 2025 Guide

Introduction

The United Arab Emirates (UAE) is one of the world’s most attractive destinations for entrepreneurs and investors. With its tax-free environment, strategic location, and investor-friendly policies, the UAE has become a global business hub. However, many startups and small businesses search for the cheapest free zone in UAE to minimize costs while still gaining access to the country’s vast opportunities.

This guide explores the most affordable free zones in the UAE, detailing their features, costs, benefits, and setup process — helping you choose the best one for your business.

Understanding UAE Free Zones

Free zones are special economic areas in the UAE that allow 100% foreign ownership, tax exemptions, and simplified regulations. There are over 45 free zones across the UAE, each designed for specific industries such as trading, logistics, IT, media, or manufacturing.

Choosing the cheapest free zone in UAE depends on your business type, required licenses, and location preferences.

Why Start a Business in a UAE Free Zone?

Setting up in a UAE free zone provides unmatched advantages, such as:

  1. 100% foreign ownership – No need for a local partner.

  2. Full repatriation – Move your capital and profits freely.

  3. Zero taxes – No corporate or personal income taxes.

  4. Quick setup process – Business registration can take as little as 3–5 days.

  5. Modern infrastructure – Access to world-class logistics, ports, and offices.

  6. Flexible visa options – Apply for multiple investor or employee visas.

The cheapest free zone in UAE allows entrepreneurs to enjoy all these benefits at a much lower cost than major zones like Dubai Multi Commodities Centre (DMCC) or JAFZA.

Top 5 Cheapest Free Zones in UAE (2025)

Let’s look at some of the most affordable and reputable free zones ideal for startups and SMEs.

1. Ras Al Khaimah Economic Zone (RAKEZ)

RAKEZ is widely recognized as the cheapest free zone in UAE for entrepreneurs looking for affordability, flexibility, and global access.

Key Features:

  • 100% foreign ownership

  • Cost-effective packages starting from AED 5,499 per year

  • Wide range of license types (commercial, industrial, service)

  • Flexi-desk options for freelancers

  • Quick registration process (3–5 working days)

Ideal For:
Consulting, trading, manufacturing, and media businesses.

2. Sharjah Media City (Shams Free Zone)

Shams Free Zone is known for its quick registration process and modern facilities.

Key Features:

  • Licenses start from AED 5,750

  • No need for a physical office space

  • 100% foreign ownership

  • Suitable for freelancers, startups, and media companies

Ideal For:
Freelancers, marketing agencies, and creative professionals looking for the cheapest free zone in UAE.

3. Fujairah Creative City Free Zone

Fujairah offers one of the lowest-cost business setups in the UAE with minimal documentation.

Key Features:

  • Packages start at AED 6,500

  • No physical office required

  • Fast approval process

  • Perfect for consultancy, design, and e-commerce services

Ideal For:
Startups looking for low-cost licenses with zero physical presence requirements.

4. Umm Al Quwain Free Trade Zone (UAQ FTZ)

UAQ FTZ is one of the cheapest free zones in UAE for microbusinesses and online entrepreneurs.

Key Features:

  • Packages from AED 8,000

  • Multiple visa options

  • Easy online registration

  • Strategic location near Dubai and Sharjah

Ideal For:
E-commerce, import/export, and trading companies.

5. Ajman Free Zone (AFZ)

Ajman Free Zone offers affordable business setup options and excellent logistics connectivity.

Key Features:

  • Starting packages from AED 9,000

  • Easy access to Ajman Port

  • Support for industrial and trading activities

  • Low renewal costs

Ideal For:
Manufacturing and export-based companies.

Factors to Consider Before Choosing the Cheapest Free Zone in UAE

Before registering your company, evaluate these factors:

  1. Business Activity – Ensure your chosen free zone supports your license type.

  2. Location and Access – Proximity to ports, airports, or clients.

  3. Visa Requirements – Check how many visas are included.

  4. Office Space Options – Flexi-desk, shared office, or warehouse.

  5. Banking Facilities – Availability of local business banking.

Choosing the right cheapest free zone in UAE depends on balancing cost with long-term business goals.

Step-by-Step Process to Set Up in a UAE Free Zone

The company registration process is simple and straightforward:

Step 1: Choose the Right Free Zone

Select a zone that fits your industry and budget.

Step 2: Decide on the Business Structure

Choose between:

  • Free Zone Establishment (FZE) – one shareholder

  • Free Zone Company (FZC) – multiple shareholders

  • Branch office of an existing company

Step 3: Apply for Initial Approval

Submit your application and business plan for pre-approval.

Step 4: Submit Documentation

Required documents include passport copies, address proof, and name reservation.

Step 5: Pay Registration and License Fees

Once approved, pay the setup cost and license fee.

Step 6: Receive Your Business License

Within a few working days, your trade license will be issued.

Step 7: Open a Bank Account

Choose a UAE bank that supports free zone accounts.

The cheapest free zone in UAE options often allow this process to be completed entirely online.

Documents Required

  • Passport copies of all shareholders

  • Passport-sized photos

  • Proof of address (utility bill or tenancy contract)

  • Business plan

  • Application form

  • Memorandum and Articles of Association

Proper documentation ensures smooth and quick registration.

Costs of Setting Up a Business in UAE Free Zones

The cost of cheapest free zone in UAE setups generally includes:

  • Registration fee

  • License fee

  • Office space or flexi-desk rental

  • Visa costs (if applicable)

Typical cost range: AED 5,000 – AED 12,000 for a one-year license package.
Renewal fees are often equal or slightly lower depending on your chosen free zone.

Cheapest Free Zone in UAE

Benefits of Setting Up in the Cheapest Free Zone in UAE

  1. Low Initial Investment – Start your business affordably.

  2. Tax-Free Environment – Zero personal and corporate tax.

  3. Full Ownership – No UAE sponsor required.

  4. Business Flexibility – Choose from trading, services, or manufacturing.

  5. Quick Setup – Complete the process in a few days.

  6. Global Access – Operate internationally with a UAE business license.

These advantages make the cheapest free zone in UAE perfect for startups and foreign entrepreneurs.

Opening a Bank Account

After obtaining your business license, you can open a corporate bank account in the UAE. Popular banks include Emirates NBD, RAKBANK, and Mashreq.

You’ll need:

  • Valid trade license

  • Shareholder passports

  • Business plan

  • Utility bill or proof of address

Bank account approval may take 5–10 working days depending on your business type

Visa and Residency Options

Most cheapest free zone in UAE packages include investor visas or eligibility to apply for them.

A flexi-desk package usually allows up to 2–3 visas. Residency visas are typically valid for 2 years and renewable.

Challenges and Considerations

While choosing the cheapest free zone in UAE, consider the following:

  • Some low-cost zones may limit business activities.

  • Visa quotas depend on office space size.

  • Banking can be stricter for virtual setups.

  • Renewal costs may vary annually.

Despite these factors, affordable free zones still offer excellent value and flexibility for small businesses.

Conclusion

Finding the cheapest free zone in UAE doesn’t mean compromising on quality or opportunity. With zones like RAKEZ, Shams, and Fujairah Creative City, entrepreneurs can enjoy world-class facilities at an affordable cost.

Whether you’re a freelancer, trader, or manufacturer, the UAE offers flexible business solutions that fit every budget. Start small, grow steadily, and expand your operations in one of the fastest-growing economies in the world.

Frequently Asked Questions (FAQs)

1. Which is the cheapest free zone in UAE?
Ras Al Khaimah Economic Zone (RAKEZ) is often considered the cheapest free zone in UAE.

2. How much does it cost to start a company in RAKEZ?
Basic packages start from around AED 5,499 annually.

3. Can I own 100% of my company?
Yes, all UAE free zones allow 100% foreign ownership.

4. Do I need a local sponsor?
No, a sponsor is not required in any UAE free zone.

5. What documents are needed for registration?
Passport copies, application form, business plan, and proof of address.

6. How long does company setup take?
The process typically takes 3–5 business days.

7. Is a physical office mandatory?
Not always. Many free zones offer flexi-desk or virtual office options.

8. What are the visa options?
Most free zone packages include 1–3 visa quotas.

9. Are taxes applicable?
No personal or corporate taxes are applied in UAE free zones.

10. Can I operate internationally?
Yes, your UAE free zone license allows global trading.

11. Are there annual renewal fees?
Yes, renewals are due every 12 months, often equal to the setup cost.

12. Can I open a corporate bank account?
Yes, most UAE banks support free zone businesses.

13. Which free zone is best for e-commerce?
Shams Free Zone and UAQ Free Trade Zone are popular for online businesses.

14. What is the cheapest free zone for freelancers?
Fujairah Creative City offers freelancer-friendly packages starting from AED 6,500.

15. Can I upgrade my license later?
Yes, you can easily upgrade your license type or office size anytime.