RAKEZ is not one free zone. It is six zones under one brand, and the zone your unit occupies changes your VAT treatment and corporate tax outcome far more than the words on your licence. Two companies with the same-looking RAKEZ licence can land in different tax positions because one leased a warehouse in Al Ghail and the other took a desk in Al Nakheel.
The split runs two ways. On VAT, the three industrial zones plus the legacy port and maritime entities sit on the Federal Tax Authority's Designated Zone list; the business zones and the Academic Zone do not [4]. On corporate tax, manufacturing and processing are Qualifying Activities, so an industrial tenant has a real route to 0% on Qualifying Income, while a service tenant is not on that closed list [5]. Most guides flatten both into one "RAKEZ is tax free" line.
This guide covers which licence fits, the only three prices RAKEZ publishes, the Designated Zone split table nobody else prints, the corporate tax split, a marketing claim that needs correcting, visa quota, and what a Ras Al Khaimah address costs a Dubai-facing business. Since 2013, our team has registered companies across Dubai's free zones and the northern emirates. This is a guide, not legal or tax advice.
Still comparing zones? Our free zone company setup page sets out how the RAKEZ route compares with a Dubai licence on cost, ownership and facilities. Talk to a setup expert→
What is RAKEZ, and what are the six zones inside it?
RAKEZ, the Ras Al Khaimah Economic Zone, was formed in 2017 by merging RAK Free Trade Zone (RAK FTZ) and RAK Investment Authority (RAKIA). That merger is why RAKEZ is a collection of distinct zones with different facility types and different tax standing, not one uniform park.
The scale figures come from UAE business press reporting on RAKEZ's announcements, which we could not confirm on rakez.com, so treat them as press-reported: over 40,000 companies from more than 100 nationalities, 19,000 new registrations in 2025 (up 44% on 2024), and 8,506 in H1 2025 against 5,933 a year earlier. India led at 33%, Pakistan 8%, the UK 7%, with a 2025 split of services 40%, trading 33% and e-commerce 17% [8].
RAKEZ's own zones page sets out the six zones, and this structure is the spine of everything below [1].
| RAKEZ zone | Character | Typically suits |
|---|---|---|
| Al Ghail Industrial Zone | Large-scale industrial manufacturing | Heavy manufacturing, plant, production lines |
| Al Hamra Industrial Zone | Light industry plus heavy industry projects | Light manufacturing, assembly, processing |
| Al Hulaila Industrial Zone | Heavier industrial manufacturing | Industrial production, materials |
| RAKEZ Academic Zone | International educational institutions and service providers | Universities, colleges, education providers |
| Al Nakheel Business Zone | SMEs and freelancers, business centres | Consultancies, services, small teams, freelancers |
| Al Hamra Business Zone | Positioned between the city centre and neighbouring emirates | Businesses wanting a shorter run toward Dubai and Sharjah |
Figures of 28.2 million square metres for Al Ghail and 12.5 million for Al Hamra Industrial circulate widely, but we could not confirm either on the zones page, so treat both as unverified.
Real Talk: The question to ask a RAKEZ adviser is not "how much is the licence" but "which zone will my unit physically sit in, and can you put that in writing". Your VAT scope, whether the Designated Zone distribution route is open, and how credible your 0% claim is all hang on that one line of the lease.
Which RAKEZ licence do you need?
RAKEZ issues commercial, general trading, service and professional, industrial, educational, e-commerce, media and freelancer permits. The category sets what you may do rather than where you may sit, and the Biz Starter page names commercial traders, consultancies, media and e-gaming, e-commerce and education as target sectors [2].
| Licence type | Covers | Zone that usually fits |
|---|---|---|
| Commercial | Trading in specified goods, import, export, distribution | Business zone office, or industrial zone with storage |
| General trading | Broad multi-line trading under one licence | Business or industrial zone, depending on storage need |
| Service and professional | Consultancy, advisory, professional services | Business zone |
| Industrial | Manufacturing, processing, assembly, packaging | Al Ghail, Al Hamra Industrial or Al Hulaila |
| Educational | Training, colleges, education providers | RAKEZ Academic Zone |
| E-commerce | Online selling platforms | Business zone, with fulfilment arranged separately |
| Media | Production, publishing, creative and e-gaming lines | Business zone |
| Freelancer permit | A single individual working in their own name | Business zone, co-working or flexi-desk |
Freelancer permit pricing is not confirmed on rakez.com. Third-party estimates cluster at AED 6,000 to 10,000 a year, so treat that band as indicative.
The trap is the licence-versus-facility mismatch. An industrial licence held at a business-zone desk does not put you in a Designated Zone, because that status attaches to geography, not your activity code. Equally, an industrial address does not make a consultancy's income qualify. Both halves need to point the same way.
What does a RAKEZ setup actually cost?
Only three RAKEZ prices are confirmable on rakez.com's own pages. Here is the first-party picture.
| What RAKEZ publishes | Price (AED) | What the page actually says |
|---|---|---|
| RAKEZ Biz Starter package | 6,000 | 24-hour setup, up to 50 shareholders, up to 10 activities, co-working membership, bank-account eligibility subject to terms. Visa count and validity not specified [2] |
| All Inclusive Business Set-up | 14,000 | Listed on the offers page. Visa, licence and facility specifics are not detailed there [3] |
| E-gaming package | from 7,725 | Listed as a sector package on the offers page [3] |
Two caveats matter more than the numbers. These sit on promotional pages, not a standing price list, so they are time-limited offers that can lapse without notice, which is why so many "RAKEZ price lists" online are out of date. And the Biz Starter page states no visa allocation and no licence validity, so if a visa matters, AED 6,000 is not your answer.
We are deliberately not repeating the wider package ranges or visa-inclusive bundle figures circulating on setup-agent sites, because none were confirmable on rakez.com. Nor is there a warehouse or land rate card we could find. Brokers quote in the region of AED 25,000 to 40,000 a year for smaller units and higher for plots, but treat any such number as a negotiated quotation.
Common Mistake: Budgeting from a promotional headline as though it were a price list. The AED 6,000 Biz Starter is a co-working product with no stated visa allocation. Founders who plan around it, then find they need two visas, a facility supporting them and an establishment card, end up far from that number. Ask for an itemised all-in figure covering licence, facility, establishment card and each visa, dated.
Which RAKEZ zones are VAT Designated Zones, and which are not?
Designated Zone status is granted zone by zone and the FTA maintains the list. Inside RAKEZ it is confined to the legacy port and maritime entities plus the three industrial zones. The business zones and Academic Zone do not appear [4].
| Zone | On the FTA Designated Zone list? | Status and date per the list |
|---|---|---|
| RAK Port Free Zone | Yes | Active from 1 January 2018 |
| RAK Maritime City Free Zone | Yes | Active from 1 January 2018 |
| Al Hamra Industrial Zone | Yes | Added effective 4 July 2019, currently active |
| Al Ghail Industrial Zone | Yes | Added effective 4 July 2019, currently active |
| Al Hulaila Industrial Zone | Yes | Added effective 4 July 2019, currently active |
| RAK Airport Free Zone | Appears with a "To" date of 4 July 2019 | See our caveated reading below |
| Al Nakheel Business Zone | No | Does not appear anywhere on the list |
| Al Hamra Business Zone | No | Does not appear anywhere on the list |
| RAKEZ Academic Zone | No | Does not appear anywhere on the list |
Read the bottom three rows carefully, because they contradict a lot of marketing. A consultancy in Al Nakheel, a trading office in Al Hamra Business Zone, an e-commerce seller on a business-zone desk and a freelancer on a RAKEZ permit are all outside any VAT Designated Zone. Their position is ordinary: register at the threshold, charge 5% on standard-rated supplies, file as normal.
Note the vintage. The FTA's latest consolidated list we could locate is dated September 2021, so confirm your zone's current position with the FTA before building a supply chain on it. We are also not publishing a total count of Designated Zones, because that number moves. Full mechanics are in our guide to Designated Zones and VAT.
Why does the FTA list say "RAK Port Free Zone", and what about RAK Airport Free Zone?
Two wrinkles on the list trip up almost every guide, and both decide whether the entity you rely on is actually listed.
The first is a renaming. The entity originally gazetted as RAK Free Trade Zone appears on the FTA's current list as RAK Port Free Zone, active from 1 January 2018 [4]. Most guides either use the old name or treat RAK Port Free Zone as unrelated. Neither is right, and an adviser who searches for "RAK Free Trade Zone" and reports it absent has a search problem, not a tax outcome.
The second is more delicate. RAK Airport Free Zone appears with a "To" date of 4 July 2019. On our reading of the table, where an active zone carries a "From" date and no closing date, a populated "To" date reads as a delisting. That is our reading, not settled law, and we have seen no confirming instrument. Most guides still show the zone as active without mentioning the "To" column. If your goods flows depend on it, get written confirmation from the FTA.
Pro Tip: When Designated Zone status drives your model, ask for the zone name exactly as it appears on the FTA list, then match it against your lease and licence. Names drift after mergers and renamings, and "we are in RAKEZ" is not an answer the list can verify. The specific listed entity is.
What does Designated Zone status change for goods and services?
Less than most founders assume, and the goods-versus-services distinction is where the value sits. A Designated Zone is outside the UAE for VAT purposes only for certain supplies of goods, and only when strict conditions on movement and consumption are met.
| Transaction | Designated Zone treatment | The practical point |
|---|---|---|
| Goods supplied within or between Designated Zones | May fall outside the scope of VAT where conditions are met | The core benefit, and it is conditional, not automatic |
| Services supplied in a Designated Zone | Standard-rated at 5% | The zone gives a consultancy nothing on VAT |
| Goods moved from the mainland into a Designated Zone | A local supply, not an export | Your mainland supplier still charges you 5% |
| Goods consumed inside the zone | Treated as within the UAE | Consumption breaks the outside-scope treatment |
| VAT registration | Normal rules apply | Mandatory at AED 375,000, voluntary at AED 187,500 |
Two rows carry most of the misunderstandings. Services in a Designated Zone are standard-rated at 5%, so a consultancy with a Designated Zone address gains no VAT benefit. And goods bought from a mainland supplier and moved into a zone are a local supply, so the supplier charges VAT normally. Founders expecting a zero-rated export meet that rule the hard way.
Can a RAKEZ company get the 0% corporate tax rate?
Some can, and it turns on your activity rather than your zone brand. The 0% rate applies to Qualifying Income of a Qualifying Free Zone Person, and Qualifying Activities sit on a closed list at Article 2(1) of Ministerial Decision No. 229 of 2025 [5]. Manufacturing and processing of goods or materials are both on it, at Article 2(1)(a) and (b), with no Designated Zone requirement.
That is the good news for an industrial tenant. A manufacturer in Al Ghail, Al Hamra Industrial or Al Hulaila has a genuine route to 0% on Qualifying Income subject to the other QFZP conditions, and since neither activity carries a Designated Zone condition, the route does not depend on the zone's VAT standing.
Everyone else is out. Services and general consultancy appear nowhere on the Article 2(1) list, which reads in full: manufacturing of goods or materials; processing of goods or materials; trading of Qualifying Commodities; holding of shares and other securities for investment; ownership, management and operation of Ships; reinsurance; fund management; wealth and investment management; headquarter services to Related Parties; treasury and financing services to Related Parties or for its own account; financing and leasing of Aircraft; distribution of goods or materials in or from a Designated Zone; logistics services; and ancillary activities. A general consultancy in Al Nakheel Business Zone genuinely does not qualify.
| RAKEZ tenant | Realistic corporate tax route |
|---|---|
| Manufacturer in Al Ghail, Al Hamra Industrial or Al Hulaila | Real 0% route via manufacturing, Art 2(1)(a), no Designated Zone condition |
| Processor or packager in an industrial zone | Real 0% route via processing, Art 2(1)(b) |
| Distributor physically inside a Designated Zone | Possible via Art 2(1)(l), but goods must enter the State through a Designated Zone |
| Logistics provider storing and moving others' goods | Possible via Art 2(3)(m), no Designated Zone condition |
| Consultancy or agency in a business zone | Not a Qualifying Activity, so ordinary taxable person rates apply |
| E-commerce seller on a business-zone desk | Generally not qualifying, and the Designated Zone routes are closed to it |
| Freelancer on a RAKEZ permit | Not a Qualifying Activity route |
Two rows need spelling out. Distribution under Article 2(1)(l) requires goods to enter the State through a Designated Zone, so it applies only to tenants inside RAK Port Free Zone, RAK Maritime City or the three industrial zones. Logistics services under Article 2(3)(m) qualifies regardless of that status, covering storage and transport for another party without taking title. Take title and you are trading. Full conditions are in our guide to the qualifying free zone person and the 0% rate.
About that "guaranteed 0% tax rate" package
This needs saying plainly and politely, because rakez.com markets a "RAKEZ Designated Zone" package promising a guaranteed 0% tax rate. That is a marketing simplification, and as a statement of law it is wrong.
No zone authority can guarantee a 0% corporate tax rate. It applies to Qualifying Income of a QFZP meeting every condition: adequate substance in the free zone, de minimis limits, transfer pricing compliance and documentation, audited financial statements, and not electing the standard rate [5]. Fail one and you are not a QFZP, and no package name protects you. Designated Zone status is a VAT concept and does not by itself deliver 0%.
Based on our experience, tenants who lose QFZP status rarely lose it on the activity test. They lose it on substance and documentation: no real people or assets in the zone, no transfer pricing file, or no audit prepared in time. If someone sells you a guaranteed rate without immediately discussing substance, audit and de minimis, they are selling a brochure.
What does a non-qualifying RAKEZ company actually pay?
The ordinary regime, and for many small RAKEZ companies that is a good answer. A free zone company that is not a QFZP is taxed as an ordinary taxable person: 0% up to AED 375,000 of taxable income and 9% above. Small Business Relief applies where revenue is at or below AED 3,000,000, but only for tax periods ending on or before 31 December 2029, and never to a QFZP [6].
| Position | Rate | Relief available | Audit required |
|---|---|---|---|
| QFZP, all conditions met | 0% on Qualifying Income, 9% on non-qualifying income | Small Business Relief not available | Yes, audited financial statements regardless of revenue size [7] |
| Ordinary taxable person | 0% up to AED 375,000, 9% above | Small Business Relief where revenue is at or below AED 3,000,000, for tax periods ending on or before 31 December 2029 [6] | Per the general thresholds |
Quick Math: A RAKEZ business-zone consultancy with AED 900,000 of taxable income pays nothing on the first AED 375,000 and 9% on the AED 525,000 above, so roughly AED 47,250, with no QFZP audit and no transfer pricing file. Chasing a 0% claim its activity cannot support would cost more in fees and audit than the tax, and risk five tax periods.
Three rules are worth having straight. A QFZP breach costs the status for the current tax period and the following four. De minimis is non-qualifying revenue not exceeding 5% of total revenue or AED 5,000,000, whichever is lower. And every QFZP needs audited financial statements regardless of revenue size under Ministerial Decision No. 84 of 2025, so the rule of thumb that only large companies need an audit does not survive [7]. That audit and the annual filings are what our post-setup services team handles.
Is there a 51% rule for free zone distribution?
No, and this is one of the most misquoted rules in UAE free zone tax. There is a revenue concentration test in the Qualifying Activities decision, but it sits inside Trading of Qualifying Commodities at Article 2(3)(c), not in distribution and not in logistics services [5].
The myth comes in two forms: that a distributor must derive at least 51% of revenue from a particular source, or that a logistics provider faces the same test. Neither is what the decision says. It cuts both ways: a distributor in an industrial zone should not be scared off a genuine 0% route by a test that does not apply, while a trader in Qualifying Commodities must look hard at Article 2(3)(c). Our guide on free zone to mainland trading covers the goods flows.
What facilities does RAKEZ offer, and how does visa quota work?
RAKEZ runs a facility ladder from co-working membership up to industrial land, and your position on it sets your visa quota. The Biz Starter description puts the entry tier at co-working membership, running up through flexi-desk, offices, warehouses and land [1][2].
| Facility tier | Typically suits | Visa quota reality |
|---|---|---|
| Co-working membership | Solo founders, holding structures, licence-only setups | Not specified on the Biz Starter page, so confirm in writing |
| Flexi-desk | Freelancers, small consultancies | Third-party sources cite 1 to 2 visas, unconfirmed on rakez.com |
| Standard or executive office | Teams needing several visas | Quota generally scales with usable area, per third-party accounts only |
| Warehouse | Storage, light industrial, fulfilment | Depends on the unit and staffing plan |
| Industrial land | Manufacturing, plant, production | Negotiated with the zone as part of the lease |
Be careful with the ratio quoted everywhere. The "1 visa per 80 square feet of usable office area" rule, and flexi-desk quotas of one to two visas, come from third-party guides, and we found no official RAKEZ quota table. Quota caps hiring: if your unit supports two visas and your plan needs five, you are renegotiating a lease before your first hire.
Common Mistake: Signing a facility on price and discovering the quota afterwards. Get the visa allocation stated in writing before you pay anything, and as a number rather than a formula. Our guide to how free zone visa quotas work explains how quota is calculated and where the negotiating room sits.
What does a Ras Al Khaimah address really cost a Dubai-focused business?
This is businessdubai.ae, so here is the part RAKEZ's material does not address and most agents skip. Ras Al Khaimah is roughly one to one and a half hours from central Dubai by road, depending on zone and destination, and that distance is an operating cost, not a footnote.
| Friction point | What it looks like in practice |
|---|---|
| Client meetings | A single morning meeting in Business Bay is most of a working day from RAK |
| Hiring | Candidates in Dubai or Sharjah face a long daily commute, narrowing your pool or raising your salaries |
| Banking | Relationship management and in-person compliance meetings happen where the bank's business centre is |
| Suppliers and inspections | Site visits, samples and audits all carry the same travel overhead |
| Team culture | A team split between a RAK licence and Dubai-based staff needs deliberate management |
Set against that, the industrial economics are genuinely different. Land and warehouse costs in the northern emirates are far lower than in Dubai's industrial zones, and for a business whose cost base is square metres rather than client meetings, that gap can be decisive.
Real Talk: For a cost-sensitive light industrial or warehousing business, RAKEZ's land and warehouse economics justify the drive. For a Dubai-facing services or trading business whose value proposition depends on being in Dubai, the saving has to clearly beat the cost of client proximity and staff commuting, and often it does not. It is not free money. The clients who regret it are the services businesses who bought on licence price and spent the difference on travel. To run that comparison against a Dubai zone, talk to a setup expert→
Does a RAKEZ licence let you work in Dubai?
Not directly, and here we want to be precise where competitors are muddy. A RAKEZ licence carries the same restriction as any UAE free zone licence: it does not by itself authorise mainland commercial activity. Trading onshore in Dubai needs a branch, a dual licence or a mainland registration, exactly what a Dubai free zone company would need.
That is worth repeating, because much comparison content presents mainland restriction as a RAKEZ-specific penalty. It is not. IFZA, DMCC and RAKEZ companies all sit on the free zone side of the same line. What RAKEZ adds is the RAK-to-Dubai commute and logistics layer, not a worse legal position.
So the decision is the ordinary one. If you need to invoice UAE mainland customers directly, our mainland company setup route removes the restriction rather than working around it. If you sell internationally, into other free zones, or manufacture for export, the free zone side stays cleaner and our free zone company setup page covers the options. A middle path is worth pricing: keep the RAKEZ industrial entity for its facility economics and add a small Dubai entity for onshore sales, which means two sets of renewals, so we model it against a single mainland company setup first.
Who is RAKEZ right for, and who should look elsewhere?
Once you separate the industrial zones from the business zones, the answer is quick.
| RAKEZ is a strong fit if you | Look at a Dubai zone instead if you |
|---|---|
| Manufacture, process, assemble or package goods | Sell consultancy or agency services to Dubai clients |
| Need warehouse or industrial land at northern-emirate rates | Depend on walk-in credibility and a Dubai address |
| Provide logistics services, storing and moving others' goods | Need to recruit Dubai-based staff without a long commute |
| Move goods through a port or Designated Zone | Want frequent in-person banking and client contact |
| Are cost-led and your cost base is space, not meetings | Are in regulated financial services, which needs DIFC or ADGM |
| Can genuinely operate from RAK day to day | Would commute to Dubai several times a week anyway |
If your model is services or a light Dubai-facing trade, compare RAKEZ against a value Dubai option such as IFZA free zone setup, where the licence costs more but the address is in Dubai. If you are trading and shipping, our Fujairah free zone guide is worth reading, since the port economics differ from RAK's.
Can a RAKEZ company open a corporate bank account?
Yes, and the Biz Starter page frames account-opening eligibility as subject to terms rather than a promise, which is the right way to read it [2]. RAKEZ companies are banked routinely, but a northern-emirate licence held by a Dubai-based founder invites one question from compliance: where is the business actually run from?
Prepare for it. A clear business description, evidence of real activity such as contracts or supplier agreements, a working website, and consistency between your licence activity and what you actually do will carry most applications. Industrial tenants have an easier time, because a warehouse is visible substance. Expect several weeks, an in-person meeting and a minimum balance.
What are the ongoing renewal, audit and compliance obligations?
The licence and facility renew annually and the tax calendar runs alongside. None of it is unusual, but it is continuous, and missing items costs more in the QFZP scenario.
| Obligation | Cycle | Note for a RAKEZ tenant |
|---|---|---|
| Licence and facility renewal | Annual | Renewal terms are quoted at renewal, not fixed by a promotional page |
| Establishment card and visas | Per card and visa validity | Visa renewals depend on the quota attached to your facility |
| Corporate tax registration and filing | Annual | Required whether you are a QFZP or an ordinary taxable person |
| Audited financial statements | Annual for a QFZP | Required regardless of revenue size under Ministerial Decision No. 84 of 2025 [7] |
| Transfer pricing documentation | Ongoing for a QFZP | Related-party dealings need arm's length pricing and a file |
| VAT registration and returns | Once the threshold is crossed | Mandatory at AED 375,000, voluntary at AED 187,500 |
The failure mode we see is not a bad structure but an unmanaged calendar: an audit left until after year end, a lease renewal that quietly changed the visa quota, or a transfer pricing file never started. Keeping renewals, audit and filings on one tracked calendar is what our post-setup services team is for, and for a QFZP it decides whether you hold the 0% position or lose it for five tax periods.
Real Client Stories
These are real examples from businesses we have helped set up. Names and details changed for privacy.
The packaging manufacturer who needed the industrial zone, not the cheap desk
A European founder arrived with a quote for a low-cost RAKEZ business-zone package plus an industrial licence, planning a small packaging and processing operation. The licence category was right; the facility was not. A business-zone desk sits outside the Designated Zone list and leaves no room for machinery. We moved him to an industrial-zone unit, putting the operation inside a listed zone for VAT and giving the processing activity under Article 2(1)(b) a clean 0% route. His comment: "I was comparing licence prices when the lease was what mattered."
The warehousing and logistics business that stayed in RAK on purpose
A GCC trading family ran regional storage and distribution, weighing a Dubai industrial zone against RAKEZ. Space economics decided it: their cost base was square metres, not client meetings, and northern-emirate warehouse rates were far lower for the footprint they needed. We structured the logistics arm around Article 2(3)(m), moving customers' goods without taking title, and got the visa quota into the lease before signing. Two years on, they have not needed a Dubai postcode.
The Dubai consultancy for whom RAKEZ was the wrong answer
A management consultant with a Dubai client list had been quoted a very cheap RAKEZ business-zone setup and asked us to confirm it was smart. It was not. A business-zone consultancy sits outside the Designated Zone list, consultancy is not on the Article 2(1) list so the 0% route was never available, and every client was in Dubai. We set him up in a Dubai zone on the ordinary regime with Small Business Relief, and the licence premium came to less than a quarter's travel. Sometimes the cheaper zone is the more expensive choice.
Set up in RAKEZ with the zone question answered first
RAKEZ is a good option for the right business and a quietly poor one for the wrong one, and the dividing line is the zone, not the brand. Industrial and logistics tenants get lower space costs, a listed VAT zone and a real 0% route. Service tenants in the business zones get a low licence price, none of the tax advantages the marketing implies, and a commute to their own market.
Since 2013, BusinessDubai.ae has completed 700+ company registrations across the UAE, including northern-emirate industrial setups and every major Dubai free zone. We will tell you which RAKEZ zone your model needs, whether your activity has a real 0% route or belongs on the standard regime, and what the RAK-to-Dubai distance will cost you. Talk to a setup expert→
Frequently Asked Questions
Is RAKEZ a Designated Zone for VAT?
Partly. The three industrial zones, Al Hamra Industrial, Al Ghail Industrial and Al Hulaila Industrial, are on the FTA's Designated Zone list, with RAK Port Free Zone and RAK Maritime City. The business zones and Academic Zone are not [4].
Which RAKEZ zones are on the FTA Designated Zone list?
Al Hamra Industrial, Al Ghail Industrial and Al Hulaila Industrial Zones, added effective 4 July 2019 and currently active, plus RAK Port Free Zone and RAK Maritime City, both active from 1 January 2018 [4].
Is Al Nakheel Business Zone a Designated Zone?
No. It does not appear anywhere on the FTA's Designated Zone list. A consultancy, service business, trading office or freelancer based there is not in a VAT Designated Zone and follows the ordinary VAT rules [4].
Is Al Hamra Business Zone a Designated Zone?
No, and the name causes real confusion. Al Hamra Industrial Zone is on the FTA list; Al Hamra Business Zone is not. Different zones, different VAT standing, so check which one your lease names [4].
What happened to RAK Airport Free Zone on the Designated Zone list?
It appears with a "To" date of 4 July 2019. Our reading is that a populated "To" date indicates a delisting, but we offer that as a reading rather than a settled position. Confirm with the FTA [4].
Why does the FTA list say RAK Port Free Zone rather than RAK Free Trade Zone?
Because the entity originally gazetted as RAK Free Trade Zone appears on the current list as RAK Port Free Zone, active from 1 January 2018. It is a renaming, not a different entity, and most guides miss it [4].
Does Designated Zone status mean a RAKEZ company pays no VAT?
No. A Designated Zone is outside the UAE only for certain supplies of goods, and only where strict conditions on movement and consumption are met. It is not a general VAT exemption, and has no effect on corporate tax [4].
Are services in a RAKEZ Designated Zone free of VAT?
No. Services supplied in a Designated Zone are standard-rated at 5%, so a consultancy gains nothing on VAT from a Designated Zone address. The split matters far more to goods businesses than to service businesses.
If I buy goods from a Dubai mainland supplier into a RAKEZ industrial zone, is that an export?
No. Goods moved from the UAE mainland into a Designated Zone are treated as a local supply, not an export, so your mainland supplier charges VAT normally. Founders budgeting for a zero-rated purchase are often caught by this.
Can a RAKEZ company get the 0% corporate tax rate?
Some can. Manufacturing and processing of goods or materials are Qualifying Activities under Ministerial Decision No. 229 of 2025, so an industrial tenant meeting every QFZP condition has a real route to 0% on Qualifying Income. Service tenants do not [5].
Is manufacturing a Qualifying Activity for the 0% rate?
Yes. Manufacturing of goods or materials is a Qualifying Activity at Article 2(1)(a) and processing at Article 2(1)(b), with no Designated Zone requirement on either. That is why industrial tenants have the strongest 0% case [5].
Is consultancy a Qualifying Activity for a free zone company?
No. Services and general consultancy do not appear anywhere on the closed Article 2(1) list. A RAKEZ business-zone consultancy is taxed as an ordinary taxable person rather than at 0% on its consultancy income [5].
Does RAKEZ guarantee a 0% tax rate?
RAKEZ markets a Designated Zone package promising a guaranteed 0% tax rate. That is a marketing simplification, not an accurate statement of law: the rate applies only to Qualifying Income of a QFZP meeting every condition, and no zone authority can guarantee it [5].
What does a non-qualifying RAKEZ company pay in corporate tax?
The ordinary rates: 0% on taxable income up to AED 375,000 and 9% above. For many small RAKEZ companies that is a reasonable outcome, and it avoids the QFZP compliance burden entirely.
Can a RAKEZ company use Small Business Relief?
Yes, if it is not a QFZP and revenue is at or below AED 3,000,000, but only for tax periods ending on or before 31 December 2026. It is not available to a QFZP, so the two routes are mutually exclusive [6].
Does a RAKEZ company need audited financial statements?
Every Qualifying Free Zone Person needs audited financial statements regardless of revenue size, under Ministerial Decision No. 84 of 2025. That surprises smaller companies which assumed audits only begin at a revenue threshold [7].
What is the de minimis threshold for a Qualifying Free Zone Person?
Non-qualifying revenue must not exceed 5% of total revenue or AED 5,000,000, whichever is lower. Breaching it costs QFZP status for the current tax period and the following four, so a small non-qualifying stream needs monitoring [5].
Is there a 51% revenue rule for free zone distribution or logistics?
No. The revenue concentration test sits inside Trading of Qualifying Commodities at Article 2(3)(c), not inside distribution or logistics services. Advisers applying a 51% test to those models have taken the condition from the wrong paragraph [5].
Do logistics services qualify without a Designated Zone address?
Yes. Logistics services at Article 2(3)(m) qualifies regardless of Designated Zone status, covering storage and transport for another party without taking title. Take title and you are trading, not providing logistics [5].
Does distribution require a Designated Zone address?
Effectively yes. Distribution under Article 2(1)(l) requires goods to enter the State through a Designated Zone, so it applies cleanly only to tenants physically inside RAK Port Free Zone, RAK Maritime City or the three industrial zones [5].
How much does a RAKEZ licence cost?
Only three prices are confirmable on rakez.com: Biz Starter at AED 6,000, All Inclusive Business Set-up at AED 14,000, and an e-gaming package from AED 7,725. All three sit on promotional pages, not a standing price list [2][3].
Does the RAKEZ Biz Starter package include a visa?
The AED 6,000 page describes 24-hour setup, up to 50 shareholders, up to 10 activities and co-working membership, but no visa count and no licence validity. Get both confirmed in writing before treating it as your budget [2].
How much does a RAKEZ warehouse or plot cost?
RAKEZ publishes no warehouse or land rate card we could find, so we are not printing one. Brokers quote around AED 25,000 to 40,000 a year for smaller units and higher for plots, but treat any figure as a negotiated quotation.
How many visas can I get with a RAKEZ licence?
There is no official RAKEZ quota table we could confirm. Third-party sources cite one to two visas on a flexi-desk and roughly one visa per 80 square feet of usable office area, but treat both as indicative and get your allocation in writing.
Does RAKEZ offer a freelancer permit?
Yes, alongside the commercial, general trading, service and professional, industrial, educational, e-commerce and media licences. Pricing is not confirmed on rakez.com; third-party estimates cluster at AED 6,000 to 10,000 a year, so treat that as indicative.
How far is RAKEZ from Dubai?
Roughly one to one and a half hours by road from central Dubai, depending on the zone and destination. That is real friction for client meetings, staff commuting from Dubai or Sharjah, and in-person banking, and RAKEZ's material does not address it.
Can a RAKEZ company trade in Dubai mainland?
Not directly. A RAKEZ licence does not by itself authorise mainland commercial activity, so onshore trading needs a branch, a dual licence or a mainland registration. This is the standard free zone restriction, not a RAKEZ-specific penalty.
Can a RAKEZ company open a corporate bank account?
Yes, though the Biz Starter page frames account-opening eligibility as subject to terms rather than guaranteed. Expect several weeks, an in-person meeting, a minimum balance, and questions about where the business is genuinely run from [2].
References
[1] RAKEZ, zones. The six zones and their industrial, academic and business-zone positioning. RAKEZ zones
[2] RAKEZ, Biz Starter package. AED 6,000, 24-hour setup, up to 50 shareholders, up to 10 activities, co-working membership, bank-account eligibility subject to terms. RAKEZ Biz Starter
[3] RAKEZ, offers. All Inclusive Business Set-up at AED 14,000 and an e-gaming package from AED 7,725. RAKEZ offers
[4] Federal Tax Authority, List of Designated Zones, September 2021. RAK Port Free Zone and RAK Maritime City from 1 January 2018; Al Hamra, Al Ghail and Al Hulaila Industrial Zones effective 4 July 2019; RAK Airport Free Zone shown with a "To" date of 4 July 2019. FTA List of Designated Zones
[5] Ministry of Finance, Ministerial Decision No. 229 of 2025 on Qualifying and Excluded Activities. Article 2(1) including manufacturing (a), processing (b) and distribution in or from a Designated Zone (l); Qualifying Commodities concentration test at 2(3)(c); logistics services at 2(3)(m). MOF Decision 229 of 2025
[6] Ministry of Finance, Ministerial Decision No. 73 of 2023, as amended by Ministerial Decision 131 of 2026 on Small Business Relief. Revenue at or below AED 3,000,000, tax periods ending on or before 31 December 2029, not available to a QFZP. MOF Small Business Relief
[7] Ministry of Finance, Ministerial Decision No. 84 of 2025 on Audited Financial Statements. Required for a QFZP regardless of revenue size. MOF Audited Financial Statements
[8] Economy Middle East, RAKEZ posts 43% surge in new company registrations in H1 2025. Press-reported company counts, nationality mix and sector split. RAKEZ H1 2025 registrations
