DAFZA Free Zone Dubai 2025: Complete Setup Guide, Costs & Benefits

Looking for a free zone with strategic location near Dubai International Airport? DAFZA (Dubai Airport Free Zone Authority), established in 1996, offers 100% foreign ownership, 0% corporate tax, and prime location adjacent to the world's busiest international airportmaking it ideal for logistics, aviation services, trading, and businesses requiring quick cargo access. With over 1,800 companies currently operating in DAFZA, it's one of Dubai's most established free zones.

As Ministry-approved business consultants with 37 years of Dubai experience (having formed 450+ DAFZA companies), we've helped businesses leverage DAFZA's strategic advantages. This comprehensive guide explains everything you need to know: DAFZA benefits, setup process, costs, permitted activities, office options, and comparison with other Dubai free zones.

What is DAFZA (Dubai Airport Free Zone Authority)?

Overview

DAFZA is a purpose-built free zone located on the southern boundary of Dubai International Airport, spanning 1.8 million square meters of prime real estate.

Established: 1996 (one of Dubai's oldest free zones)

Key Features:

• 100% foreign ownership
• 100% profit repatriation
• 0% corporate tax (for qualifying businesses)
• 0% personal income tax
• No currency restrictions
• Immediate proximity to Dubai Airport
• Direct access to cargo terminals

Strategic Location Benefits:

• 5 minutes from Dubai International Airport terminals
• Direct access to airport cargo facilities
• 15 minutes to Dubai city center
• 20 minutes to Jebel Ali Port
• Connected to major highways (Sheikh Mohammed Bin Zayed Road, Emirates Road)

DAFZA Authority Structure

DAFZA is a government entity operating under Dubai Customs, providing:

• Company registration services
• Immigration services (visa processing)
• Office and warehouse space
• Business support services
• Customs clearance facilitation

Dubai Context: Unlike some free zones that only provide licensing, DAFZA offers complete infrastructure including office space, warehouses, and direct customs accessmaking it a true "one-stop-shop" for business setup.

Benefits of DAFZA Free Zone

1. Strategic Airport Location

Unmatched Proximity to Dubai Airport

Logistics Advantages:

• 5-minute drive to airport cargo terminals
• Direct truck access to cargo facilities
• Same-day air freight processing
• Quick turnaround for time-sensitive shipments
• 24/7 operations (aligned with airport schedules)

Business Travel:

• Employees can reach airport in minutes
• Ideal for businesses with frequent international travel
• Easy client visits from abroad
• Premium business address

Example Use Case: Import/export business receives cargo from China. Can clear customs and deliver to DAFZA warehouse within 2 hours of flight landingvs 4-6 hours for locations farther from airport.

2. 100% Foreign Ownership

No UAE Partner Required

• Single shareholder or multiple foreign shareholders
• Complete operational control
• All profits belong to owners
• No local sponsor arrangements
• Direct bank account ownership

Pre-2021 Context: Before UAE's 100% mainland foreign ownership, free zones like DAFZA were the only option for complete foreign ownership. DAFZA has 25+ years of experience facilitating foreign businesses.

3. Tax Benefits

Zero Corporate Tax (for Qualifying Free Zone Persons):

• 0% tax on profits (if meet qualifying criteria)
• Must conduct no business with UAE mainland
• Must maintain adequate substance in UAE
• Proper accounting required

Zero Personal Income Tax:

• No tax on salaries
• No tax on dividends
• No withholding tax

No Import/Export Duties:

• Import goods duty-free into DAFZA
• Re-export without duties
• Storage without customs duties
• Only pay duties if moving goods to UAE mainland

VAT Considerations:

• VAT registration threshold: AED 375,000 taxable supplies
• Most DAFZA exports: 0% VAT rated
• Imports into DAFZA: VAT suspended
• Advantageous for international trading

4. Comprehensive Infrastructure

Ready Business Facilities:

Office Spaces:

• Flexi-desks (from AED 15,000/year)
• Small offices (from AED 25,000/year)
• Large offices (up to 500+ sq m)
• Fully furnished options available
• High-speed internet included

Warehouses:

• Air-conditioned warehouses (temperature-controlled)
• Ambient warehouses (standard)
• Sizes: 100 sq m to 10,000+ sq m
• Direct loading/unloading bays
• 24/7 access

Specialized Facilities:

• Cold storage facilities
• Hazardous goods storage (approved)
• Showrooms
• Light manufacturing units

Support Services:

• On-site customs clearance
• Freight forwarding services
• Banking facilities
• Cafeterias and retail
• Security (24/7)

5. Fast Company Formation

Streamlined Process:

• Application to license: 3-5 business days
• Single-window service (all services from DAFZA)
• No external approvals needed (for most activities)
• Digital processing
• Experienced DAFZA team

vs Mainland:

• Mainland: 18-25 days minimum
• DAFZA: 3-7 days possible
• Time savings: 2-3 weeks

6. Business Support Services

DAFZA Provides:

• Business setup assistance
• Visa processing (efficient)
• Customs facilitation
• Networking events
• Business matching services
• Access to DAFZA business community (1,800+ companies)

Customs Integration:

• DAFZA operates under Dubai Customs
• Simplified customs procedures
• Faster clearance than independent operators
• Dedicated customs staff in free zone

7. Visa Allocation

Flexible Visa Options:

License-Based Allocation:

• Standard license: 3-5 visas
• Enhanced packages: 10-15 visas
• Larger facilities: 20+ visas available

Visa Types Available:

• Investor/Partner visas (3 years)
• Employment visas (2-3 years)
• Dependent visas (family sponsorship)

Processing:

• Fast visa processing (7-10 days)
• All visa services through DAFZA
• No need to visit external immigration centers

DAFZA Permitted Business Activities

Primary Categories

1. Trading & Commerce

• General trading
• Import/export
• Distribution
• E-commerce
• Wholesale/retail
• Re-export operations

2. Logistics & Supply Chain

• Freight forwarding
• Supply chain management
• 3PL (third-party logistics)
• Warehousing services
• Cargo handling
• Transportation coordination

3. Aviation Services

• Ground handling support services
• Aircraft parts trading
• Aviation consulting
• Airline support services
• Aerospace components

4. Professional Services

• Business consulting
• Management services
• IT consulting
• Marketing agencies
• Design services
• Technical consulting

5. Light Manufacturing

• Assembly operations
• Packaging
• Labeling
• Light production
• Quality control
• Product customization

6. Technology & IT

• Software development
• IT services
• Technology consulting
• Digital services
• E-commerce platforms

Restricted Activities

Not Permitted in DAFZA:

• Heavy manufacturing (requires industrial zone)
• Banking/financial services (requires DIFC/special license)
• Insurance (regulated separately)
• Healthcare services (requires DHA approval)
• Educational institutions (requires KHDA)

Most Suitable For:

• Import/export traders
• Logistics companies
• Aviation-related businesses
• E-commerce operations
• Distribution businesses
• Consulting firms with international clients

DAFZA Company Setup Process

Timeline: 5-10 Business Days

Phase 1: Pre-Application (Day 1-2)

Step 1: Choose Business Activity

• Select from DAFZA's approved activities list
• Can choose multiple activities
• Align activities with business plan

Step 2: Select Company Type

• FZ-LLC (Limited Liability Company): 1-50 shareholders
• FZ-Establishment: Single shareholder
• Branch of foreign company

Step 3: Choose Office/Warehouse

• Flexi-desk (if office-based business)
• Office (if need dedicated space)
• Warehouse (if trading/logistics)
• Combination office + warehouse

Phase 2: Application & Approval (Day 3-5)

Step 4: Submit Application

Required Documents:

• Completed application form
• Passport copies (all shareholders)
• Passport photos (white background)
• Business plan (basic outline)
• Proof of address (shareholders)
• Bank reference letter (some cases)

Step 5: Name Approval

• Propose 3 business names
• DAFZA checks availability
• Approval within 24 hours
• Must include "FZ-LLC" or "FZE"

Step 6: License Approval

• DAFZA reviews application
• May request additional information
• Approval typically within 2-3 days
• Receive license offer letter

Phase 3: Payment & License Issuance (Day 6-8)

Step 7: Payment

• License fees
• Registration fees
• Office/warehouse lease (annual)
• Immigration card fees
• Total: Pay full amount

Step 8: License Issuance

• Digital license issued same day after payment
• Physical license delivered within 3 days
• Memorandum of Association provided
• Share certificate issued

Phase 4: Post-License (Day 9-20)

Step 9: Visa Processing

• Submit visa applications
• Medical fitness tests (arranged by DAFZA)
• Emirates ID application
• Visa stamping
• Timeline: 10-15 days

Step 10: Bank Account

• Apply for UAE corporate bank account
• DAFZA provides bank introduction letters
• Submit: License, MOA, passports, business plan
• Account opening: 7-14 days

Step 11: Move-In

• Collect office/warehouse keys
• Setup operations
• Connect utilities (internet, phones)
• Start trading

DAFZA Costs Breakdown

License & Registration Fees

Company Registration:

• Registration fee: AED 10,000-15,000
• License fee (single activity): AED 12,000-18,000
• License fee (multiple activities): AED 18,000-25,000
• Immigration card (per shareholder): AED 3,000-4,000

Total License Costs: AED 25,000-42,000 (first year)

Office Space Costs (Annual)

Flexi-Desk:

• Shared workspace: AED 15,000-20,000/year
• Includes: Desk, internet, utilities
• Access to meeting rooms
• Business address

Small Office (15-30 sq m):

• Dedicated office: AED 30,000-50,000/year
• Private space
• Furnished or unfurnished options

Medium Office (50-100 sq m):

• AED 60,000-100,000/year
• Suitable for 5-10 employees
• Multiple rooms possible

Large Office (100+ sq m):

• AED 100,000-200,000+/year
• Full team accommodation
• Meeting rooms, private offices

Warehouse Costs (Annual)

Small Warehouse (100-500 sq m):

• Ambient: AED 80,000-150,000/year
• Air-conditioned: AED 120,000-200,000/year

Medium Warehouse (500-1,500 sq m):

• Ambient: AED 150,000-350,000/year
• Air-conditioned: AED 250,000-500,000/year

Large Warehouse (1,500+ sq m):

• Custom quotes based on specifications
• AED 400,000-1,000,000+/year

Visa Costs (Per Person)

Investor/Partner Visa:

• Visa processing: AED 7,000-9,000
• Medical fitness: AED 350-500
• Emirates ID: AED 770 (3 years)
• Total per person: AED 8,000-10,000

Employee Visa:

• Similar costs: AED 7,500-9,500 per employee

Total Year 1 Costs

Minimum Setup (Flexi-Desk, 1 Shareholder):

• License & registration: AED 28,000-35,000
• Flexi-desk (annual): AED 15,000-20,000
• Visa (1 person): AED 8,000-10,000
• Total Year 1: AED 51,000-65,000

Realistic Setup (Small Office, 2 People):

• License & registration: AED 32,000-40,000
• Small office (annual): AED 35,000-50,000
• Visas (2 people): AED 16,000-20,000
• Professional services: AED 8,000-12,000
• Total Year 1: AED 91,000-122,000

Trading/Logistics (Warehouse, 3-5 People):

• License & registration: AED 35,000-42,000
• Warehouse (500 sq m): AED 120,000-200,000
• Visas (5 people): AED 40,000-50,000
• Equipment/setup: AED 20,000-50,000
• Total Year 1: AED 215,000-342,000

Year 2+ Recurring Costs

Annual Expenses:

• License renewal: AED 15,000-25,000
• Office/warehouse rent: AED 15,000-200,000
• Visa renewals: AED 8,000+ (per person)
• Utilities: AED 2,000-10,000
• Total Annual: AED 40,000-250,000+ (depending on size)

DAFZA vs Other Dubai Free Zones

DAFZA vs DMCC

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Choose DAFZA if: Need airport/cargo proximity, logistics operations Choose DMCC if: Want premium address, commodities trading, larger business community

DAFZA vs JAFZA

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Choose DAFZA if: Air freight focus, office-based business Choose JAFZA if: Manufacturing, sea freight, need larger/cheaper warehouses

DAFZA vs Dubai Silicon Oasis (DSO)

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Choose DAFZA if: Trading/logistics business Choose DSO if: Tech startup, want lower costs

Ideal Businesses for DAFZA

Perfect Fit Companies

1. Import/Export Traders

• Receive goods via air freight
• Need quick customs clearance
• Distribute to UAE/GCC
• Time-sensitive products

Example: Electronics importer receives components from Asia, clears customs at DAFZA within 2 hours, repackages, ships to GCC customers same day.

2. E-Commerce Fulfillment

• Receive inventory via air
• Store in DAFZA warehouse
• Ship internationally
• Quick turnaround required

Example: E-commerce company stores inventory in DAFZA, receives orders, ships globally using Dubai Airport's extensive flight network.

3. Aviation Services Companies

• Aircraft parts suppliers
• Ground handling support
• Aviation consulting
• Airline support services

Example: Aircraft parts distributor maintains urgent inventory in DAFZA, delivers parts to airlines at Dubai Airport within 30 minutes.

4. Logistics & Freight Forwarders

• Freight consolidation
• Last-mile delivery coordination
• Supply chain management
• 3PL operations

5. Pharmaceutical/Medical Equipment Distributors

• Temperature-controlled storage needed
• Quick import/export
• Strict regulatory compliance
• Time-sensitive products

Not Ideal For

Heavy Manufacturing:

• JAFZA or other industrial zones better
• DAFZA focuses on light assembly/packaging

Purely Mainland-Focused Businesses:

• If all customers in UAE, mainland company better
• DAFZA companies need distributor for mainland sales

Budget-Conscious Startups:

• DSO or CommerCity cheaper for startups
• DAFZA costs ~50% higher than budget free zones

Common Questions & Answers

Q: Can DAFZA companies sell to UAE mainland? A: Not directly. Need to appoint mainland distributor or pay 5% customs duty + VAT when bringing goods to mainland. Most DAFZA companies focus on import/export or use distributor.

Q: How long does DAFZA company formation take? A: 5-10 business days from application to license. Fastest among established free zones. Visa processing adds 10-15 days.

Q: Do I need to visit Dubai to form DAFZA company? A: No. Can complete remotely with Power of Attorney. Only need to visit for visa stamping and Emirates ID (3-5 days).

Q: Can I store goods in DAFZA and sell internationally? A: Yes, this is DAFZA's primary use case. Import duty-free, store, and export without customs duties. Only pay duties if moving to UAE mainland.

Q: What's the minimum warehouse size in DAFZA? A: Around 100 sq m for standard warehouses. Larger units (500+ sq m) more common. Contact DAFZA for current availability.

Q: Does DAFZA require audit? A: Not mandatory for most free zone companies. However, recommended for proper accounting. If qualifying for 0% corporate tax, proper accounts essential.

Q: Can I upgrade office/warehouse later? A: Yes, easy to upgrade as business grows. Common progression: Flexi-desk → Small office → Office + warehouse.

Professional DAFZA Setup Services

We provide complete DAFZA company formation:

Activity Selection: Confirm DAFZA suitable for your business Document Preparation: All applications and paperwork DAFZA Liaison: Direct coordination with DAFZA authority Office Selection: Help choose right office/warehouse Visa Processing: Complete visa and Emirates ID services Bank Account Support: UAE bank introductions Post-Setup: Accounting, compliance, ongoing support

Timeline: 7-10 days (total)

Cost: AED 8,000-12,000 professional fees

Package: License, office, visa, all government fees included

Call: +971 42 500 251 Email: info@auditfirmsdubai.ae

Your DAFZA Action Plan

Week 1: Planning

• Confirm DAFZA suitable for your business type
• Determine office vs warehouse vs combination
• Budget AED 60,000-120,000 for Year 1
• List business activities
• Prepare company name options

Week 2: Formation

• Submit DAFZA application
• Provide required documents
• Choose office/warehouse
• Pay fees
• Receive license (Day 5-7)

Week 3-4: Activation

• Apply for visas
• Complete medical tests
• Open bank account
• Setup office/warehouse
• Start operations

Ready to setup in DAFZA?

Contact us for free consultation:

Call: +971 42 500 251 Email: info@auditfirmsdubai.ae

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Related Guides:

• Free Zone Comparison
• Business Setup Costs
• Company Formation Timeline