Dubai Healthcare City- Non-Designated Zone

Dubai Healthcare City is an urban healthcare landmark facilitating individuals and corporations to advance their healthcare services, engage with the community and enjoy the energy of the central healthcare districts.

Dubai Healthcare City (DHCC) is a free zone committed to creating a health and wellness destination. Launched in 2002 by His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, the free zone has worked towards its vision to become an internationally recognized location of choice for quality healthcare and an integrated center of excellence for clinical and wellness services, medical education and research.

The free zone is governed by the Dubai Healthcare City Authority (DHCA) and regulated by the independent regulatory arm, Dubai Healthcare City Authority – Regulation (DHCR), whose quality standards are accredited by the International Society for Quality in Healthcare (ISQua).

DHCC has close to 160 clinical partners including hospitals, outpatient medical centers and diagnostic laboratories across 150 plus specialties with licensed professionals from almost 90 countries, strengthening its medical tourism portfolio. Representing its network of support partners, close to 200 retail and non-clinical facilities serve the free zone. DHCC is also home to academic institution the Mohammed Bin Rashid University of Medicine and Health Sciences, part of the Mohammed Bin Rashid Academic Medical Center.

Advantages of establishing a business in DHCC:

  • 100% foreign ownership.
  • Full repatriation of profits and capital.
  • Guaranteed 50-year exemption from personal, income and corporate taxes.
  • Exemption from customs duty for goods and services.
  • 100% tax free.
  • No restrictions on capital, trade barriers or quotas.
  • Competitive pricing.

Commercial benefits:

  • Low operating costs.
  • State-of-the-art facilities.
  • Flexible real estate design to suit business requirement/industry.
  • Integrated healthcare community providing specialized high-quality healthcare.
  • Access to network of regional and international healthcare professionals.
  • Attractive investment opportunities and financial returns.
  • Increased brand exposure.

The minimum paid-up capital requirement to incorporate a Free-zone Limited Liability company (FZ-LLC):

  • Non-clinical facilities/companies are required to have minimum paid-up capital of AED 50,000.
  • Clinical facilities are required to have minimum paid-up capital of AED 100,000.
  • Hospitals are required to have minimum paid-up capital of AED 300,000.
  • For hotels, please refer to the below:
    • 3-star hotels are required to have minimum paid-up capital of AED 1 Million.
    • 4-star hotels are required to have minimum paid-up capital of AED 2 Million.
    • 5-star hotels are required to have minimum paid-up capital of AED 3 Million.
  • For branches, minimum paid-up capital does not apply.

Commercial space options available inside DHCC:

  • Leasing solutions.
  • Clinical spaces.
  • Non-clinical (retail) spaces.
  • Business center:
  • Executive Desk: – perfect for companies that require minimum space.
  • Executive Office – full-fledged furnished office.

DHCC also offers:

  • Investment opportunities.

Types of licenses:

  • Free Zone Limited Liability Company.
  • Branch of a Foreign Company.
  • Branch of UAE Company/Establishment.

Value Added Tax (VAT):

Value Added Tax (VAT) has been introduced across the UAE on 1 January 2018 at a standard rate of 5%.

Who should register for VAT?

A business whether situated in designated zone or non-designated zone or outside free zone should register for VAT if the taxable supplies and imports exceed the mandatory registration threshold of AED 375,000 within preceding 12 months or it is anticipated  that the total value of taxable supplies exceed AED 375,000 in the next thirty 30 days. Upon registration, a tax registration number (TRN) would be issued to business by the Federal Tax Authority.

What is a designated zone?

A Designated zone is a specified fenced geographical area having security measures and customs controls in place to monitor entry and exit of individuals and the movement of goods to and from the area. Following free zones are declared as designated zones.

a. Free Trade Zone of Khalifa Port
b. Abu Dhabi Airport Free Zone
c. Khalifa Industrial Zone
d. Jebel Ali Free Zone (North-South)
e. Dubai Cars and Automative Zone (DUCAMZ)
f. Dubai Textile City
g. Free Zone Area in Al Quoz
h. Free Zone Area in Al Qusais
i. Dubai Aviation City
j. Dubai Airport Free Zone
k. Hamriyah Free Zone
l. Sharjah Airport International Free Zone
m. Ajman Free Zone
n. Umm Al Quwain Free Trade Zone in Ahmed Bin Rashid Port
o. Umm Al Quwain Free Trade Zone on Sheikh Mohammed Bin Zayed Road
p. RAK Free Trade Zone
q. RAK Maritime City Free Zone
r. RAK Airport Free Zone
s. Fujairah Free Zone
t. FOIZ (Fujairah Oil Industry Zone)

What is a non-designated zone?

Any free zone which is not declared as designated zone is a non-designated zone. In other words a non – designated zone is any geographical area within UAE which does not have any security measures and custom controls in place to monitor entry and exit of goods and individuals. Eg. DMCC, Dubai Media city, DIFC and Dubai Internet city.

What transactions are subject to VAT within Designated zones?

a) Goods transferred between designated zones shall not be subject to VAT. However goods supplied by an entity in the designated zone to entities outside the designated zone are subject to 5% VAT.
b) Services provided by an entity to other entities inside the designated zone or outside the designated
zone are subject to 5% VAT.
c) Professional fees for services are subject to VAT @ 5%.

What government/free zone fees (License/Visa/rent) are subject to VAT?

In case of designated zones the trade license fees, visa fees, lease rentals will not be subject to VAT. And in case of non-designated zones the trade license fees and visa fees are not subject to vat however rent is subject to 5% VAT.

If you need additional assistance or have any questions, please contact the following:
Email: legal@jitendragroup.ae
Tel: +971 4 343 8022