General Trading License in Dubai 2026: Permitted Activities, Mainland vs Free Zone Rules and the Corporate Tax Treatment of Trading Companies

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A general trading licence is one of the most searched licences in the UAE, and also one of the most misunderstood. Many founders assume it lets them buy and sell “anything” from anywhere, at 0% tax, with no approvals. None of that is fully true. What you can trade depends on the activities written on your licence, where the licence is issued, which regulators must approve your goods, and how the UAE tax rules treat the income your trading generates.

This guide explains the licence in plain terms, compares a Dubai mainland licence with a free zone trading licence, lists the goods that usually need extra permission, and then covers the part most competitor guides skip: what corporate tax, VAT and customs mean for a trading company in 2026.

Published: 30 September 2026

Quick Answer

A general trading licence in Dubai lets a company trade in the goods listed among its approved activities. On the mainland, the licence is issued by the Dubai Department of Economy and Tourism (DET), and the company may trade inside the UAE and abroad. In a free zone, the licence is issued by the free zone authority and is normally limited to trading from and within that zone, plus export and re-export, unless the zone offers a dual licence. For tax, a trading company pays 9% corporate tax on taxable income above AED 375,000, must register for VAT once taxable supplies pass AED 375,000, and must register with customs if it imports or exports.

What “General Trading” Actually Means

There is no single legal product called “general trading” that covers every good on earth. The term is a market label for a trade licence with a broad list of trading activities, often covering wholesale and retail of several product groups. What counts is the exact activity list on your licence.

In Dubai, mainland activities are selected from the DET business activity list through the Invest in Dubai portal. The names, codes and groupings on that list change from time to time, so check the current list on the portal before you rely on any code you saw in an article, including this one.

Three practical points follow from this:

1. You can only legally trade the goods that fall inside your listed activities. Selling a product group that is not on the licence can lead to fines or licence action.
2. Adding an activity later is possible, but each new activity may trigger its own approval.
3. Banks, customs and suppliers will look at the activity list on your licence, not the words “general trading” on the cover.

Permitted Activities: What a Trading Licence Usually Covers

A trading licence typically allows some or all of the following, depending on the activities chosen:

• Wholesale and retail trade in approved goods.
• Import and export of those goods.
• Storing stock in licensed premises.
• Supplying businesses, government and semi-government buyers (mainland).
• Online sales of the same approved goods, where the licence covers e-commerce.

What it does not automatically cover:

• Manufacturing or processing (that needs an industrial licence).
• Professional or service activities (these need their own activity codes).
• Regulated products, which need a separate permit even if the activity is on the licence.

Common Activity Groups Under a General Trading Licence

Because “general trading” is a label rather than a fixed legal category, the useful question is which product groups you can list as activities. The groups below are the ones most often combined on one trading licence. Exact activity names and codes come from the DET list (mainland) or the free zone authority’s own list, so treat this table as a planning guide, not a substitute for the official list.

Product group	Typical trading activities	Extra approval to expect
Consumer electronics and mobile accessories	Import, wholesale, retail, e-commerce	Usually product conformity checks at customs
Garments, textiles and fashion	Import, export, wholesale, retail	Generally none beyond the licence
Food and beverage products	Import, distribution, storage	Dubai Municipality food control approval
Cosmetics and personal care	Import, wholesale, retail	Dubai Municipality product registration
Building materials, furniture and machinery	Import, wholesale, supply to contractors	Depends on the item; some need Ministry or civil defence approval
Medical devices, pharmaceuticals and chemicals	Not covered by a plain trading activity	Ministry of Health and Prevention or other regulator, plus a specific activity

Two practical limits apply to every row. First, the activities must be written on the licence; listing a group in your business plan is not enough. Second, the number of activities that can sit on one licence differs between DET and each free zone, so ask the authority for its current limit before you choose a bundle of product groups.

Mainland vs Free Zone General Trading

The biggest decision is where the licence is issued. Both options are legal, and both can be the right choice. They serve different sales models.

Point	Dubai mainland (DET)	Free zone
Issuing authority	Dubai Department of Economy and Tourism	The free zone authority
Sell directly to UAE customers	Yes	Usually not directly; via a distributor, a mainland licence, or a dual licence where offered
Government and semi-government tenders	Open to mainland companies	Often restricted
Premises	Registered tenancy (Ejari) needed; purely virtual set-ups are generally not accepted	Flexi-desk or office options depend on the zone
Trading from a designated zone	Not applicable	Warehouse in the zone can support export and re-export
Corporate tax	9% above AED 375,000	0% only on qualifying income if the company is a Qualifying Free Zone Person; otherwise 9%
VAT	Standard 5% rules	Depends on whether the zone is a designated zone and how goods move

For a fuller side-by-side, read our guide to mainland vs free zone in Dubai and our mainland company setup guide.

Ownership on the mainland

Reforms to the Commercial Companies Law (Federal Decree-Law No. 32 of 2021) opened most commercial activities to 100% foreign ownership. Some activities still have conditions, and practices differ between sources online, so confirm the position for your exact activity with DET before you sign a lease or a share agreement. If a local service agent or sponsor structure applies to you, see our comparison of local sponsor vs corporate sponsor for a UAE mainland LLC.

Trading in a free zone

A free zone trading licence works well when your customers are outside the UAE, or when you re-export from a zone warehouse. It becomes harder if most of your buyers are UAE mainland businesses, because mainland sales change your tax position (explained below). Some free zones and authorities allow a dual licence or a mainland branch. Our article on free zone companies expanding to the mainland covers how that works.

Goods That Need Extra Approvals or Are Restricted

Even with the right activity on your licence, some goods need approval from a specialist regulator before you can trade them. Common examples of approving bodies include:

• Ministry of Health and Prevention, for medical devices, pharmaceuticals and some health products.
• Ministry of Industry and Advanced Technology, for certain industrial and technology goods.
• Dubai Municipality, for food, cosmetics and some consumer products.
• Civil defence authorities, for goods that are flammable or need special storage.
• Dubai Customs and the Federal Authority for Identity, Citizenship, Customs and Port Security, for controlled or restricted goods at the border.

Some products are prohibited outright, and others (for example tobacco and energy drinks) are subject to excise tax on top of other duties. See our guide to UAE excise tax rates and products if your product list includes any excise goods.

The rule of thumb: check the product, not just the licence. Ask the relevant regulator for the permit before you order stock, not after the container arrives.

Setting Up: The Basic Steps

The exact sequence depends on the jurisdiction, but a mainland set-up in Dubai generally follows this path:

1. Choose the legal form and the trade name, then reserve the name.
2. Select the activities from the DET list.
3. Obtain initial approval.
4. Sign the Memorandum of Association where required.
5. Secure premises and register the tenancy contract.
6. Pay the government fees and receive the licence.
7. Open a corporate bank account.
8. Register for corporate tax, and for VAT if required.
9. Register with Dubai Customs if you will import or export.

Costs and timelines vary by activity, premises and jurisdiction, so use the official fee schedules for the authority you choose. Renewal is annual; our Dubai trade licence renewal guide explains what to prepare. If you or your staff will live in the UAE, remember that a residence visa can be cancelled after a long stay abroad, and our sister site Yalah Dubai explains the 180-day rule for residence visas.

Corporate Tax for Trading Companies in 2026

This is the section that decides whether your trading business is profitable after tax. Under Federal Decree-Law No. 47 of 2022, UAE corporate tax applies at 0% on taxable income up to AED 375,000 and 9% on taxable income above that amount.

Mainland trading company

A mainland trading company is a normal taxable person. It pays 9% on taxable income above AED 375,000, must register with the Federal Tax Authority (FTA) even if its income is low, and files an annual return within nine months of the end of its tax period. Small Business Relief may apply while your revenue is at or below AED 3 million, but it is available only for tax periods that end on or before 31 December 2026. Read our small business relief guide before you plan your first year around it.

Free zone trading company

A free zone company pays 0% only if it is a Qualifying Free Zone Person (QFZP) and only on its qualifying income. Everything else is taxed at 9%. To qualify, the company must, among other things:

• Maintain adequate substance in the free zone.
• Earn qualifying income from qualifying activities.
• Keep non-qualifying revenue within the de minimis limit, which is the lower of 5% of total revenue or AED 5 million.
• Meet the transfer pricing and audited financial statement requirements.
• Not choose to be taxed under the standard regime.

If the de minimis limit is exceeded, the company loses QFZP status, and all its income is taxed at 9% under the standard rules, and it cannot return to QFZP treatment for a period of years. This is the most expensive mistake a trading company in a free zone can make.

Why goods trading is tricky for QFZP

Selling general goods to UAE mainland customers is normally not qualifying income, and it counts toward the de minimis limit. Qualifying activities are set out in the Ministry of Finance decisions on qualifying and excluded activities. The current instrument is Ministerial Decision No. 229 of 2025, which widened the commodity trading rules and applies from 1 June 2023. Trading of qualifying commodities, and distribution of goods from a designated zone, can be qualifying activities under those rules, but ordinary retail or wholesale of goods to mainland buyers generally is not.

In practice, a free zone trading company with heavy mainland sales often finds that it either fails the de minimis test or would pay 9% anyway. In that case, a mainland licence may be the cleaner structure. To go deeper, read:

• QFZP explained
• Qualifying income for QFZP
• Qualifying activities under Ministerial Decision 229
• Excluded activities

VAT for Trading Companies

VAT is charged at 5% on most supplies of goods in the UAE. Under Federal Decree-Law No. 8 of 2017:

• Registration is mandatory when taxable supplies exceed AED 375,000 in the previous 12 months, or are expected to exceed it in the next 30 days.
• Voluntary registration is allowed from AED 187,500 in taxable supplies or expenses.
• A registered trader charges output VAT, and can normally recover input VAT on business purchases, if it keeps valid tax invoices.

Goods moved between designated zones, or exported outside the GCC, have special treatment, and the rules depend on the exact movement and the paperwork. Review our list of VAT designated zones and the VAT registration guide. Businesses in the e-invoicing programme should also read our e-invoicing requirements, because trading companies issue a high volume of invoices.

Customs and the Import-Export Code

If you import goods into Dubai, register with Dubai Customs and obtain an import-export code before shipment. The general customs duty rate on most goods entering the UAE is 5% of the customs value, with exemptions and special rates for certain products. Excise and VAT may also apply at the border. Our UAE customs duty guide explains how the calculation works. Never assume the rate; check the tariff code for your product.

Records You Must Keep

Trading companies handle stock, invoices, freight and customs papers, and the FTA can ask for them. Keep books, invoices, contracts, customs declarations and bank records for seven years. Our record-keeping guide sets out the list and the FTA penalties.

Common Mistakes to Avoid

1. Buying a licence before checking whether your goods need approval.
2. Choosing a free zone and then selling mostly to mainland customers.
3. Ignoring the de minimis limit until the year-end accounts.
4. Registering for VAT late, or not at all, when supplies pass AED 375,000.
5. Importing without a customs code, or using the wrong tariff code.
6. Treating a trade licence with no trading as “dormant” and forgetting the corporate tax return. See trade licence with no business activity and corporate tax.

Choosing the Right Structure: A Simple Decision Guide

• Selling mainly to UAE businesses and government: a mainland licence is usually the natural fit.
• Selling mainly abroad, with stock held in a zone: a free zone licence may fit, and QFZP treatment may be possible if your activity qualifies.
• Mixed sales: model the tax on both structures before you choose, using real revenue splits.

If you want a second opinion on the tax side of a trading structure, message us on WhatsApp.

Related Reading

• Can Your UAE Residence Visa Be Cancelled After 6 Months Abroad? (Yalah Dubai)

• Mainland vs free zone tax in the UAE

• Mainland vs free zone in Dubai
• UAE VAT registration
• UAE customs duty
• Small business relief

Frequently Asked Questions

What is a general trading licence in Dubai?

It is a trade licence with a broad list of trading activities. On the mainland it is issued by the Dubai Department of Economy and Tourism, and the goods you may trade are those written on your activity list.

What activities can I put on a general trading licence in Dubai?

Most licences combine import, export, wholesale, retail and e-commerce across product groups such as electronics, garments, food products, cosmetics, building materials and furniture. Regulated goods like medical products and chemicals need their own activity and regulator approval. Check the exact activity names on the DET list or your free zone’s list.

Can a general trading licence cover any product?

No. Each product group must be within the licensed activities, and some products need approval from regulators such as the Ministry of Health and Prevention or Dubai Municipality. Some goods are prohibited.

Can a foreigner own 100% of a mainland trading company in Dubai?

Most commercial activities are open to 100% foreign ownership after the Commercial Companies Law reforms (Federal Decree-Law No. 32 of 2021), but some activities have conditions. Confirm your activity with DET.

Does a free zone trading company pay 0% corporate tax?

Only if it is a Qualifying Free Zone Person and only on qualifying income. Other income is taxed at 9%. If non-qualifying revenue exceeds the lower of 5% of total revenue or AED 5 million, the company loses QFZP status.

What is the corporate tax rate for a mainland trading company?

0% on taxable income up to AED 375,000 and 9% on the amount above it, under Federal Decree-Law No. 47 of 2022.

When must a trading company register for VAT?

When taxable supplies exceed AED 375,000 in the previous 12 months, or are expected to exceed it in the next 30 days. Voluntary registration is possible from AED 187,500.

Do I need an import-export code?

Yes, if you import or export goods through Dubai Customs. Register with customs before your first shipment.

What is the customs duty rate on imported goods?

The general rate is 5% of the customs value for most goods, but exemptions and other rates exist. Confirm the tariff code for your product.

Can I sell to mainland customers from a free zone licence?

Usually not directly. You would typically need a distributor, a mainland licence or branch, or a dual licence where the free zone offers one. Mainland sales also affect QFZP status.

Is Small Business Relief available to a new trading company?

It may be, if revenue is AED 3 million or less, but only for tax periods ending on or before 31 December 2026. Check eligibility before relying on it.

How long must a trading company keep its records?

Seven years, including invoices, contracts, customs papers and bank records.

Sources

Figures and rules in this guide come from the UAE Federal Tax Authority (tax.gov.ae), the Ministry of Finance (mof.gov.ae), Federal Decree-Law No. 47 of 2022 on corporate tax, Federal Decree-Law No. 8 of 2017 on VAT, Cabinet Decision No. 100 of 2023, Ministerial Decision No. 229 of 2025, and the Dubai Department of Economy and Tourism. Activity codes, fees and approval lists change, so verify with the relevant authority before you act.