Dubai Industrial City – Non- Designated Zone

Dubai Industrial Park (Dubai Industrial City) is a designated district within of Dubai Wholesale City, one of the largest industrial hubs in Dubai. DIC was established with the objective of fast-tracking growth and expansion of the industrial sector in the United Arab Emirates – especially seeking to attract players in the light and medium manufacturing sectors with specific emphasis on food and beverage, base metals, transport equipment and parts, machinery and mechanical equipment, workshops, logistics, chemicals, and mineral products.Offering cost effective and efficient business incentives for the region’s manufacturing sector, Dubai Industrial Park serves an enabling ecosystem for investors with integrated offerings of industrial land, labour villages, and warehousing facilities.

Dubai Industrial Park is strategically located nearby Al Maktoum Airport and in proximity to the Jebel Ali Port. The Park provides a traffic free environment with direct connections to Sheikh Mohammed Bin Zayed Road and the Emirates Road, giving easy and convenient access to global transportation points via road, air and sea.

Permitted activity: logistics, manufacturing, trading, retail and other related activities.
License available: Trading, Service, Commercial and Industrial license.
Types of entities: Limited Liability Company (LLC), Branch, Subsidiary and JV.
Share capital: Not required, however minimum of AED 300,000/- to be shown in MOA.

Business benefits:

  • 100% foreign ownership
  • 100% repatriation of capital and profits
  • No personal income taxes
  • No corporate taxes
  • Duty free imports of machinery, equipment and raw material for production
  • Close access to Jebel Ali Port and Al Maktoum International Airport

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