An Expat’s Guide to Relocation to the United Arab Emirates
The United Arab Emirates (UAE) has become an increasingly popular destination for expats from around the world. This Middle Eastern country is formed of seven emirates including the popular hubs of Abu Dhabi and Dubai.
In fact, expats make up a staggering 88% of the UAE’s population, drawn by the country’s unique lifestyle, abundant professional opportunities, world-class infrastructure and favourable tax environment.
This country is well known for offering a high standard of living, whether you prefer lavish restaurants, nightlife, and shopping, or want to explore the many natural wonders and outdoor activities the region has to offer.
Relocating to the UAE can be an exciting adventure but will require careful planning and preparation. Life here is very different from the UK and everything from the climate, culture, and even the different structure of the work week can take some getting used to.
01 Life in the UAE: What to Expect
It’s no surprise that there are so many UK expats in the UAE. The country offers high salaries, a luxurious lifestyle, and serves as a gateway to the rest of the world, making it simple to travel to Asia, Europe, and Africa during your downtime. Plus, the absence of income tax is a significant attraction.
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For those relocating with children, the UAE boasts excellent educational opportunities with a variety of international schools, catering to families from diverse backgrounds. Here, you’ll experience a fascinating blend of tradition and modernity, as well as meeting people from all over the globe.
However, it's important to note the differences in lifestyle between locals and expats, as well as the extreme wealth gap that exists between high-income and low-income foreigners. Culturally, the UAE is starkly different from the UK and Europe; being a conservative Muslim country, it’s crucial to familiarise yourself with local laws and customs, such as dressing modestly in public.
Located in the Arabian Desert, the climate can be quite extreme. Temperatures in the summer months often soar above 40 degrees Celsius, which means a lot of time spent indoors, in air-conditioned comfort.
Interestingly, even in the bustling city of Dubai, living costs are generally lower than in the UK, particularly when compared to London, where the Numbeo Cost of Living Index estimates some expenses to be as much as 41% higher. Additionally, property prices and rent in the UAE are typically much more affordable than in the UK, making it an appealing choice for many.
02 Visa Requirements
For British expats wanting to move to the UAE, there are several ‘residence visa’ options to consider. Obtaining a residence visa allows you to open a bank account, access financial services, apply for a driving licence, and register your children in schools.
Explore the different types of residence visas available in the UAE on the official Government portal here.
03 Working in the UAE
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Green Visa
This new visa lets individuals live and work in the UAE for up to 5 years without the need for employer sponsorship. Instead, applicants can self-sponsor by proving they have sufficient funds. It’s designed for highly skilled workers, freelancers, and entrepreneurs who can demonstrate relevant skills, qualifications, or investments. You’ll receive a 60-day work permit to enter the UAE and complete the visa process, and the Green Visa can be renewed for long-term residency.
Employment Visa
This employer-sponsored visa is for individuals who have already secured a job in the UAE. It's valid for 1-3 years and is renewable, with the possibility to convert it into residency by registering for an Emirates ID. However, to maintain this visa, you will need to stay employed with your sponsoring company.
Freelance Visa
This is Ideal for self- employed individuals in the arts, media, design or education. The freelance visa is valid for 1-3 years and is renewable. Applicants need a university degree or diploma, at least two years of experience in their sector, and a minimum annual income of AED 360,000 (around £75,000).
Golden Visa
This long-term residence visa allows ‘foreign talents’ to live, work, or study in the UAE for 5 or 10 years with the option to renew. Golden Visa holders can also sponsor family members to join them in the UAE as dependents. It’s ideal for investors, entrepreneurs, researchers, scientists, doctors, and others who make significant contributions to the UAE economy.
04 Retiring in the UAE
If you’re considering retiring in the UAE, there are a few visa pathways to explore. Besides the Golden Visa, you might also qualify for a Property Owner Visa if you purchase property valued at over AED 1 million (approximately £200,000).
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The UAE also offers a dedicated Retirement Visa for individuals over the age of 55. To be eligible, you’ll need to show evidence of sufficient income or savings to support yourself or buy real estate worth at least AED 1 million. This visa is valid for 5 years and can be renewed, making it a long-term option.
Overall, this can be a fantastic retirement destination, offering excellent healthcare, and an already established community of British expats in the UAE. However, it’s important to be prepared for the UAE’s hot climate, as outdoor activities can be limited during the scorching summer months.
05 Paying Tax in the UAE
The UAE is renowned for not imposing any income tax, capital gains tax, inheritance tax, or property tax on its residents. This is undoubtedly a huge draw for many expats seeking to grow their wealth.
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Some business activities may be subject to UAE corporation tax and the country has recently introduced a 5% VAT on the purchase of goods and services, more information on which can be found here.
It's important to note that while the UK has a tax treaty with the UAE, you should still be aware of tax residency rules, as you may still be liable for certain taxes in the UK, even if you're living in the UAE.
If you hold a UAE residence visa, you may need to obtain a Taxation Residence Certificate to prevent double taxation. To ensure you remain compliant and fully understand your tax obligations, it's wise to seek advice from a tax specialist who can help clarify your tax residency status.
06 Can I Transfer My UK Pension to the UAE?
The UAE is not currently on HMRC’s list of approved Qualifying Recognised Overseas Pension Schemes (QROPS), so if you're considering transferring your pension, you'll need to choose a QROPS in an approved country, like Malta or Gibraltar, and manage it from there. However, this approach can be very costly.
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The International SIPP (Self-Invested Personal Pension) is a far better option as it is specifically designed for UK expats.
This pension scheme remains in the UK, allowing you to retain all the benefits of a UK pension along with the security and protection of UK regulators, while still taking advantage of the tax efficiencies the UAE offers if you are a tax resident.
An International SIPP provides the flexibility of multi-currency withdrawals and offers a wide range of investment opportunities to help grow your retirement funds. It's generally a more affordable alternative to a QROPS, helping you avoid the strict regulations and potential penalties associated with QROPS transfers.
The Wealth Genesis has supported many UK expats in managing their pensions abroad. To find out how we can assist you, book a call with us today.
07 Healthcare in the UAE
Healthcare in the UAE requires expats to have private medical insurance, and if you're working in the country, your employer may provide this for you.
Whilst the UAE does have a public healthcare system that expats can access, it’s not free. You will need to apply for a health card from the ministry of health, and since the system is primarily designed for Emirati citizens, you might experience long wait times, and some services may not be available in English.
For these reasons, many expats choose private health insurance, which offers faster access to services, specialists, and a broader range of treatments.
08 Advice for Expats Moving to the UAE
A move to the United Arab Emirates can be an exciting adventure, but it can also be daunting. There's no doubt that this life change will bring some significant adjustments, especially when it comes to your finances.
With so many complexities to navigate, seeking professional advice can take the stress out of the transition.