According to data from the British Business Group in Dubai, a representative body of British companies and individuals, the UAE has historically been a tourism and business destination for the UK, with over 5,000 British businesses in the country.
Over 120,000 British citizens live in the UAE, drawn by the promise of new job opportunities, more visa options, and a tax-free salary. Prior to the pandemic, there were approximately 300,000 British expats working throughout the GCC.
Statistics also show that between 2007 and 2012, more than 10,000 British people relocated to the UAE each year; however, the influx has increased in recent years, according to UK regulatory data. As a result, there is an increasing need to understand how British ex-pats calculate taxes on income earned both abroad and at home.
According to research, the majority of British ex-pats in the UAE work in industries ranging from construction to banking, oil, and tourism, among others, and fewer than 700 people receive a UK state pension here.
Dealing with your tax affairs as an expat in the UAE can be difficult. However, careful planning will ensure that you pay the correct UK taxes and maximize the financial opportunities available to you as an expat.
If you are a British expat in need of tax advice, there are a few things you should keep in mind. Your UK tax status is ultimately determined by your place of residence and domicile. Both of these are complex terms The term ‘domicile’ refers to the country where you have a permanent residence. At birth, you are automatically assigned a domicile, which is usually the same as your father’s.
It is possible to change your domicile status, but it is a lengthy and difficult process. Domicile is crucial because if you are domiciled in the United Kingdom, your worldwide assets will be subject to UK Inheritance Tax (regardless of your UK residency status).
If you are not a UK resident, however, only your UK assets are subject to Inheritance Tax (IHT) own set of rules, so understanding how they are defined is usually beneficial.
