Starting a Business in RAKEZ: What You Need to Know
Why Start a Business in Ras Al Khaimah?
Ras Al Khaimah, often shortened to RAK, is one of the seven emirates of the UAE, in the north of the country. Entrepreneurs choose it for its lower entry cost than Dubai, its industrial and warehouse space and its start-up-friendly free zone. A report on RAKEZ’s first quarter of 2023 counted 1,839 new companies joining the zone.
Key takeaways
- RAKEZ suits start-ups that want a low entry cost, space to grow or an industrial base.
- Free zone companies can be 100% foreign-owned.
- A RAKEZ company cannot sell freely on the mainland, so plan how you reach customers.
- Corporate Tax, VAT, visas and banking all follow your license, so plan the first year, not just the license.
What Is RAKEZ?
In 2017 the Ras Al Khaimah government set up the Ras Al Khaimah Economic Zone (RAKEZ) to oversee its key free zones, the Ras Al Khaimah Free Trade Zone and the RAK Investment Authority. The two bodies merged into one entity. RAKEZ now serves companies in more than 50 sectors, from trading and consulting to manufacturing and logistics. For license types, rules and fees, see our guide to the RAKEZ free zone.
Is RAKEZ Right for Your Start-Up?
RAKEZ is a good fit if you want to keep costs down, need warehouse or industrial space, or work with clients abroad. It is a weaker fit if most of your customers are in Dubai, because a free zone company can trade within the UAE outside the zone only through an agent, distributor or parent company. If that is your plan, read about the free zone to mainland options.
For a sense of scale, these are EZONE’s starting packages for four popular zones:
| Free zone | Starting package |
|---|---|
| Ajman Free Zone | AED 5,555 |
| SPC | AED 5,750 |
| RAKEZ | AED 6,010 |
| Meydan Free Zone | AED 12,500 |
Your final cost depends on activity, workspace and visas. See the RAKEZ license cost breakdown and our comparison of the cheapest free zones in the UAE.
A First-Year Roadmap
- Before you apply. Define your activity, pick the license type and decide how many visas you need, because the workspace sets the visa quota.
- Apply and get your license. EZONE prepares the application, and you sign the documents.
- First 30 days. Visas, Emirates ID and a bank account. Our first 30 days checklist covers the order.
- Within three months. Companies incorporated on or after 1 March 2024 must register for Corporate Tax within three months, with an AED 10,000 penalty for registering late. See corporate tax registration.
- When you pass the VAT threshold. VAT registration is mandatory above AED 375,000 of turnover over the previous 12 months, or when you expect to pass it within 30 days. See VAT registration.
- At renewal. Plan the license and visa renewals, and ask whether a three-year license fits your activity.
Mistakes Start-Ups Make in RAKEZ
- Choosing on price alone. A low starting package helps only if your activity and visas fit.
- Starting on a flexi-desk and needing more visas. A flexi-desk is limited to one visa.
- Assuming you can sell in Dubai directly. Free zone companies need an agent or a mainland license for that.
- Ignoring the activity rules. Each license type allows a set number of activities.
How EZONE Can Help
EZONE handles the RAKEZ application, visas, bank account and tax registration, so you deal with one team. See our company formation services, or compare the other options in Ras Al Khaimah on our Ras Al Khaimah business setup page and our RAK ICC offshore guide. Our sister site covers free zone and mainland dual licenses, and companyformationinuae.com has more on formation. Get in touch on 800-EZONEUAE or setup@e.zone.
You might also be interested in the Meydan Free Zone license, the SPC Free Zone license and Ajman Free Zone business setup.
Frequently Asked Questions
Yes, if you want a lower entry cost, space to grow or an industrial base. It is less suited to businesses that sell mainly to customers in Dubai.
Many of the first steps can be done remotely, although some authorities and banks need a visit later. Ask EZONE to confirm the steps for your nationality and activity.
RAKEZ offers flexi-desks, offices and industrial space. The choice affects how many visas you can hold, and a flexi-desk is limited to one visa.
Within three months of incorporation for companies incorporated on or after 1 March 2024. The penalty for missing the deadline is AED 10,000.
Only through an agent, distributor or a parent company with the relevant license. Companies that need direct access can look at a mainland or dual license.
EZONE's RAKEZ packages start from AED 6,010. The final cost depends on activity, workspace and visas.
