You chose a free zone for speed, cost control, and ownership flexibility. That choice still makes sense. The problem starts when growth moves beyond the free zone boundary.
Bigger corporate clients operate on the mainland. Government contracts require mainland eligibility. Enterprise procurement teams prefer vendors licensed onshore. Until recently, expansion usually meant building a second structure with heavy setup costs.
In 2026, the free zone to mainland permit in the UAE gives you a third option. You expand legally into mainland Dubai without setting up a new company.
This is now one of the most practical structural routes available to service businesses, consultancies, technology firms, and trading companies.
What Changed Under Executive Council Resolution No. 11 of 2025
Dubai introduced a formal legal framework allowing eligible free zone companies to operate in mainland Dubai through permits issued by the Department of Economy and Tourism.
You now have three routes.
Temporary mainland operating permit (6 months)
- Cost: AED 5,000
- Validity: 6 months
- Renewal: AED 5,000 per additional 6 months
- Processing time: usually 1 to 2 weeks via the Invest in Dubai platform
- Typical use: market testing, early expansion, contract execution
Mainland branch license (1 year)
- Cost: around AED 10,000 per year
- Validity: 1 year
- Renewal: annually
- Typical use: stable, ongoing mainland operations
Branch route while remaining based in the free zone
This option allows you to license mainland activity while retaining operational headquarters inside the free zone. It is commonly used when mainland revenue becomes consistent and predictable.
Certain sectors still sit outside this framework. DIFC-regulated financial institutions remain excluded, and highly regulated sectors such as insurance and healthcare usually require separate licensing routes.
Cost Structure Founders Actually Compare
The commercial decision usually comes down to numbers.
Traditional mainland setup
- Set up cost commonly ranges between AED 35,000 and AED 75,000
- Annual license and renewal costs often exceed AED 10,000
- Physical office lease with Ejari registration usually required
- Setup timelines commonly stretch to 4–8 weeks
Distributor or agent model
- Lower initial cost
- Ongoing commercial cost through margin loss and reduced control
- Slower delivery cycles for complex client work
Free zone to Mainland permit UAE
- Entry cost: AED 5,000
- Activation timeline: typically 1–2 weeks
- Structure: no new legal entity required
For service-based businesses, this cost structure supports expansion without forcing premature structural investment.
Eligible Business Activities for Free Zone to Mainland Permit in 2026
The Department of Economy and Tourism published the eligible activity list by September 2025. The categories focus on scalable business models with lower regulatory risk.
Currently eligible categories include:
- Technology and IT services
- Business consultancy and advisory
- Design and creative services
- Professional services such as accounting, engineering, legal advisory
- Trading and commercial activities
If your activity sits inside these categories, the DET permit-free zone company route would likely fit.
Clear activity classification during application reduces approval delays. Using DET-aligned activity wording matters more than founders initially expect.
Corporate Tax and Reporting Requirements
The UAE free zone to mainland permit allows market access. It does not change tax obligations.
Mainland-sourced income generally falls under the UAE corporate tax regime. The standard structure applies:
- 0 percent tax on taxable income up to AED 375,000
- 9 percent tax on taxable income above AED 375,000
Free zone qualifying income can still receive 0 percent treatment when Qualifying Free Zone Person conditions remain satisfied.
A practical example:
- AED 500,000 generated from qualifying free zone clients
- AED 200,000 generated from mainland clients using the permit
If the AED 200,000 stays within the AED 375,000 threshold, corporate tax on that portion remains 0 percent under the general threshold rule. If mainland income rises beyond the threshold, the excess becomes taxable at 9 percent.
The operational requirement that matters most is record separation.
You must maintain clear financial separation between free zone and mainland income. Proper bookkeeping, documented allocation, and audit-ready records protect your tax position and your permit status.
Application Process Through Invest in Dubai
The application follows a predictable sequence.
1. Free zone approval
Request a No Objection Certificate from your free zone authority confirming your activity can extend to mainland Dubai.
2. Online application
Submit the application through the Invest in Dubai platform. You must provide:
- company license and unified license
- shareholder and manager identification
- memorandum and formation documents
- activity-specific supporting documents
3. DET review
DET reviews the application against the eligible activities list and regulatory requirements.
4. Payment and activation
After approval, pay AED 5,000, and the permit becomes active for six months.
Once active, you can contract, invoice, and deliver services in mainland Dubai using your existing company under the free zone to mainland permit in the UAE.
When the Permit Route Becomes Commercially Logical
This route works best when demand already exists.
A commonly used benchmark from business advisors places the inflection point at roughly 15 to 25 percent of revenue coming from mainland clients. At this level, direct access tends to outperform distributor models and remains significantly more efficient than a full mainland setup.
The six-month structure also works as a controlled testing period.
You can:
- pursue enterprise contracts
- respond to government tenders
- build mainland client pipeline
- evaluate conversion rates
If traction develops, renewal or transition to a branch license becomes a strategic decision rather than a structural gamble.
Operational Obligations Under the Permit
Permit holders must comply with:
- federal and local labor law requirements
- DET and free zone authority inspections
- accurate use of company details on contracts and invoices
- audit-ready financial records
These are operational responsibilities rather than obstacles. Businesses that treat compliance as part of delivery typically avoid friction during renewal cycles.
What This Route Actually Solves
The free zone to mainland permit in the UAE solves a specific structural problem.
It allows you to expand legally into mainland Dubai without:
- building a second company too early
- absorbing unnecessary setup costs
- losing control through agent models
- delaying growth due to structural complexity
It works best for:
- service-based businesses
- consultancies and advisory firms
- technology and digital companies
- design agencies
- trading companies with mainland demand
If mainland clients already appear in your pipeline, this route gives you a commercially rational structure that matches your stage of growth.
We at Advantia support founders considering the free zone to mainland permit in the UAE with clear, practical guidance across eligibility, documentation, and application. We handle the process end-to-end and help you structure tax treatment, record separation, and compliance properly so your expansion stays efficient and controlled.
