Starting a business in the UAE is a dream for many entrepreneurs, but let’s be honest, cost is often the first thing on everyone’s mind. While the UAE is known for its world-class infrastructure and global business appeal, setting up a company doesn’t always have to be expensive. This is exactly why many startups, freelancers, and first-time business owners look for the cheapest free zone in the UAE – a way to enter the market without stretching their budget from day one.
What many people don’t realise is that the UAE has several low-cost free zones that still offer all the key benefits, like 100% foreign ownership, tax advantages, and a fast setup process. Some even provide budget-friendly license packages and zero-visa options, making them perfect for new businesses and solo entrepreneurs.
So, here’s everything you need to know about the cheapest free zones in the UAE, their costs, what each option is best for, and a few smart tips to help you avoid hidden charges.
What Is a Free Zone in the UAE?
A free zone is a designated business area in the UAE where entrepreneurs can set up a company with fewer rules, lower costs, and faster approvals. These zones are created to support foreign investors, startups, and small businesses by offering ready-made business packages and industry-focused licenses.
Why Do Entrepreneurs Choose Free Zones?
There are three main reasons why most new business owners pick a Free Zone:
- 100% Ownership: You own 100% of your business. You do not need a local partner or sponsor to hold shares in your company. It is fully yours.
- Tax Advantages: Most Free Zones offer 0% personal income tax. Also, if your business meets certain rules, you might not have to pay corporate tax. You also don’t pay customs duties on goods you bring into the Free Zone.
- Easy Setup: The process is fast and simple. You usually don’t need a lot of paperwork, and in many Free Zones, you don’t even need to rent a physical office; a “virtual office” is enough.
Free Zone vs. Mainland: What’s the Difference?
The main difference is where you can do business.
- Free Zone Company: Perfect if you do business internationally or with other Free Zone companies. However, you generally cannot trade directly with customers inside the UAE Mainland without a local agent or permit.
- Mainland Company: You can trade freely with anyone, anywhere – both inside the UAE and internationally.
List of the Cheapest Free Zones in the UAE
Below are some of the most affordable free zones in the UAE, especially popular among startups, freelancers, and small business owners. Each option has its own strengths, depending on your business activity, budget, and future plans.
1. Sharjah Media City (SHAMS)
Sharjah Media City, commonly known as SHAMS Free Zone, is one of the UAE’s most budget-friendly jurisdictions. It’s designed to support creatives, freelancers, and small service businesses by offering simplified licensing and flexible packages. Its focus on modern professions and low barrier to entry makes it very attractive for startups.
Best For:
- Freelancers and individual professionals
- Content creators, media, and marketing firms
- Online and service-based businesses (consulting, coaching, events)
Starting License Cost Range: Around AED 5,500 – AED 7,000 (varies by activity and package)
2. Ajman Free Zone
Ajman Free Zone is a well-established and reliable free zone that combines low costs with business flexibility. Known for its welcoming environment, it has become popular with startups, trading companies, and service businesses looking for a cost-effective UAE presence.
Best For:
- Trading and import-export businesses
- Small to medium service providers
- SMEs planning business expansion
Starting License Cost Range: Approx. AED 6,000 – AED 8,000
3. RAKEZ (Ras Al Khaimah Economic Zone)
RAKEZ is one of the UAE’s fastest-growing free zones, combining affordability with strategic infrastructure options. It supports a broad range of industries – from services to light manufacturing and trading, making it a great choice for businesses that want room to grow.
Best For:
- Startups and SMEs
- Trading, industrial, and manufacturing businesses
- Businesses needing warehouses or light industrial facilities
Starting License Cost Range: Around AED 5,500 – AED 7,500
4. IFZA Dubai
IFZA (International Free Zone Authority) in Dubai is quickly becoming a favourite because it offers a Dubai business address at lower costs than many traditional free zones. Its modern licensing structure, flexible activity selection, and practical approach make it ideal for smart, budget-conscious entrepreneurs. IFZA is also known for its transparent pricing, which means fewer surprises during setup and renewal.
Best For:
- Consultants, freelancers, and digital professionals
- E-commerce and tech service providers
- Business owners who want a Dubai presence without high costs
Starting License Cost Range: Around AED 12,900 – AED 18,000
5. UAQ Free Trade Zone (UAE Free Trade Zone)
The Umm Al Quwain Free Trade Zone (UAQ FTZ) is one of the UAE’s least expensive business jurisdictions. It’s ideal for entrepreneurs who want a simple, fast, and low-cost setup without compromising on legal backing or business flexibility.
Best For:
- Small trading and consultancy firms
- Freelancers and service businesses
- Budget-conscious startups testing the UAE market
Starting License Cost Range: Approx. AED 6,000 – AED 7,500
6. Fujairah Creative City Free Zone
Fujairah Creative City Free Zone is a popular low-cost option, especially for professionals and service-based businesses. Located on the UAE’s east coast, it offers simple licensing, quick approvals, and minimal setup requirements, making it ideal for entrepreneurs who want to start fast and stay lean.
Best For:
- Freelancers and consultants
- Media, education, and IT service providers
- Small startups with limited budgets
Starting License Cost Range: Approx. AED 6,500 – AED 8,000
7. Dubai Silicon Oasis Authority (DSOA)
Dubai Silicon Oasis Free Zone is a government-owned free zone focused on technology, innovation, and digital businesses. While not the cheapest in absolute terms, it still offers good value for tech-driven startups looking for a Dubai-based ecosystem.
Best For:
- Tech startups and IT companies
- Software, AI, and digital innovation businesses
- Entrepreneurs seeking a strong tech-focused environment
Starting License Cost Range: Approx. AED 12,000 – AED 20,000
8. SPC Free Zone (Sharjah Publishing City)
Sharjah Publishing City (SPC) Free Zone is gaining popularity due to its competitive pricing and fast company setup. While it started with a focus on publishing and media, it now supports a wide range of business activities, including consulting, trading, and e-commerce.
Best For:
- Consultants and service-based businesses
- E-commerce and trading companies
- Entrepreneurs looking for quick approvals
Starting License Cost Range: Approx. AED 5,750 – AED 7,500
Note: License costs may vary. Better consult with our experts at AE Setup.
What Is the Cheapest Free Zone License Cost in the UAE?
If you’re looking to start a business on a tight budget, the cheapest free zone license cost in the UAE usually starts from around AED 5,500 to AED 8,000. These basic packages are often designed for freelancers, solo entrepreneurs, and startups who don’t need visas immediately. They typically include a business license, company registration, and a registered address within the free zone.
Zero-Visa vs Visa Packages:
A zero-visa package is the most affordable option and is ideal if you don’t plan to live in the UAE or already have a visa through another source. It allows you to legally run a business but does not include residence visas.
On the other hand, visa packages include one or more UAE residence visas, which increases the overall cost. Visa-inclusive packages generally start from AED 12,000 and can go up to AED 20,000+, depending on the free zone, number of visas, and office requirements.
Can You Open a Bank Account with a Cheap Free Zone Company in the UAE?
Yes, it is possible to open a bank account with a cheap free zone company in the UAE, but banks usually look at more than just the setup cost. They focus on your business activity, documents, and overall company profile. Some low-cost or zero-visa packages may face extra checks, especially if there’s no UAE residence visa or physical office. However, choosing the right free zone and license makes the process much easier.
With proper documentation and expert support, many entrepreneurs successfully open bank accounts even with budget-friendly free zone companies, without unnecessary delays.
Start Right with AE Setup
Choosing the cheapest free zone in the UAE isn’t only about finding the lowest price. What really matters is choosing an option that fits your business needs today and supports your plans for the future. Things like visa options, renewal costs, and bank account support can make a big difference later on, even if the initial setup looks cheap.
This is where All Emirates Setup (AE Setup) makes the process simple and stress-free. We help you select the right free zone based on your budget and business activity, with transparent pricing and no hidden costs. From trade license and visa assistance to corporate bank account support, our team provides end-to-end guidance at every step. So instead of just choosing the cheapest option, you can choose the right one, with confidence and expert support by your side.
