The Emirati State of Dubai continues to attract expats and immigrants to come to live and work in huge numbers.
Exciting employment opportunities coupled with a generous tax regime and peppered with a high standard of living all conspire to make Dubai one of the world’s premier dream destinations for the ambitious.
In this post, we are going to take a closer look at the Benefits of moving to the UAE, why so many are moving to Dubai for work, the realities of both salaries and taxes in Dubai, and how expats can transfer money from UAE back to their home countries cost-effectively.
How Many Expats Are Moving to UAE?
The United Emirates (Dubai and Abu Dhabi) are without any doubt amongst the single hottest expat destinations on earth. In fact, there are an estimated 8.92 million expats living in the UAE right now out of a population of just 10.8 million! Non-Emiratis outnumber natives by nearly 9 to 1 making the UAE what is possibly the biggest cultural melting pot on earth.
This is a truly remarkable figure. Now let’s look at exactly why so many are choosing to try their luck in the UAE and what they can expect to find.
Why Move To UAE?
There are 3 main reasons why expats are moving to UAE and in particular, moving to Dubai.
Low UAE Tax Rate For Foreigners
The main reason why expats move to UAE is that the tax regime in the UAE is extremely favourable. The country imposes a 0% income tax meaning that everybody who works in the kingdom is allowed to keep 100% of what they earn.
This regime was introduced to attract foreign investment, foreign skills, and foreign labour and has largely worked.
However, this is set to change slightly. From 2023, the UAE is set to introduce Corporation Tax of 9% on profits exceeding $102k. This is still extremely low and crucially, does not impact employees drawing a salary.
UAE Salaries For Foreigners Higher Than Back Home
Many large, multinational corporations now have major offices in Dubai. The nation’s tech, industry, and banking sectors are all booming and all of them offer opportunities to skilled (or simply keen) expats.
Estimates do vary, but we can safely say that the average annual salary in the UAE is somewhere around the 300,000 AED ($81,677) mark.
While the national language of Dubai and Abu Dhabi is Arabic, business is typically conducted in English and so native speakers are in high demand for many corporate roles.
In fact, even English teaching jobs in Dubai typically pay a baseline of at least $2k (remember that’s tax-free) and there are very lucrative teaching roles available in private schools and in large corporations that effectively run their own language centers for employees.
Comfortable Expat Life
Aside from offering high salaries and low taxes, Dubai also offers a thoroughly decent standard of living for those who can afford it.
The city is modern, efficient, clean, and green. Accommodation standards are amongst the best in the world, there is a truly vibrant restaurant scene and of course, Dubai’s shopping malls are famed temples to consumerism.
Of course, there is a flip side to this. Dubai can get uncomfortably hot in summer, some do struggle to adjust to the conservative Islamic culture and critics accuse Dubai of lacking any genuine culture.
On balance though, Dubai can offer a standard of existence that is hard to match anywhere else.
Save For Retirement
The final reason why expats move to Dubai is to amass wealth for use in their twilight years; simply, Dubai is an ideal place to earn and save.
While living costs can be high, any expat who can tighten their belt and resist the urge to succumb to the temptation of those aforementioned shopping malls should be able to accumulate some serious cash very fast.
As we covered, salaries for skilled or corporate jobs can be very high ( sometimes twice as high as in the West) and the 0% tax regime means that every dirham earned can be converted into dollars or pounds and tucked away for retirement.
Any expat looking to save for retirement (or maybe to buy the property back home) does need to consider how best to transfer their money out of the UAE and back into their bank account at home.
International money transfers can prove to be expensive as banks charge transaction fees, and offer very poor foreign currency exchange rates.
For example, transferring money from UAE internationally to the UK, Europe or the US will typically end up costing 5% of the transaction’s value via the banks.
Best Way To Transfer Money From UAE
Fortunately, though, there are now many different dedicated money transfer services operating in Dubai that specialise in helping expats send their money home for less.
These companies offer low/zero fee transactions along with a much better exchange rate than the banks offer. As a rule of thumb, using a money transfer provider to transfer money from UAE will cost around 1% – 2%.
Moving To Dubai: Conclusions
So why move to Dubai? Well, a combination of highly paid employment opportunities coupled with zero taxes makes it an excellent place to earn.
Of course, moving to UAE is not without its downsides as the heat and culture can both feel oppressive to westerners. However, the ones who can acclimate will find that the high UAE salaries for foreigners and low UAE tax+rate for foreigners mean that they can enjoy life while saving for a comfortable retirement.