Dubai Internet City (DIC) – Non- Designated Zone

Dubai Internet City, a member of Dubai Holding subsidiary TECOM Investments, was founded in October 1999, and it opened its doors in October 2000. Dubai Internet City is the Middle East and North Africa’s largest information and communications technology hub. Dubai Internet City (DIC) has been created and designed to support information and communications technology (ICT) companies, standing out as the biggest ICT infrastructure built inside a free zone. Dubai Internet City (DIC), a forerunner in carrying forward Dubai’s vision of transitioning into a knowledge-based economy, has successfully developed an ecosystem for technology organizations.

Dubai Internet City business benefits:

  • No personal, income and corporate taxes (50-year exemption)
  • 100 per cent foreign ownership
  • Full repatriation of profits
  • Metro Ethernet environment
  • Dynamic international community
  • Networking opportunities
  • Market development opportunities
  • World class communications infrastructure on new innovative technologies
  • Digital voice and high-speed data services offered at competitive rates
  • Commercial offices, Business Centers (Executive Desk and Executive Office) and Conference Facilities

Legal entities inside Dubai Internet City:

  • Free Zone Limited Liability Company (FZ-LLC)
  • Branch of a Foreign Company, where the applicant is a foreign registered corporate person
  • Branch of a UAE Company, where the applicant is a UAE registered corporate person

Business Infrastructure in Dubai Internet City:

  • Commercial offices
  • Business Centers with Executive Desk and Executive Office
  • Conference Facilities
  • Amenities – Star Hotels, Fitness Facilities, Dining and Retail, Banking & ATM, Medical, Security and Public Safety

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