Working In Dubai....?

Question

What is the situation for British expats wantring to work in Dubai or Saudi Arabia? Is it true if you work in the UAE although it is tax free when you return to the UK you will be taxed on the money you have earnt even though you are not living in the UK?

If so why do people go to work in Dubai if the tax free element is over-run???

Anyone explain.... much appreciated. Thanks!

Answer 1

No, its not true that you pay tax on everything you earned whilst in Dubai. You would only be taxed on money earned abroad in the tax year in which you return. Therefore it is best to return early in the UK tax year (ie April 7th or 8th!) thus saving the tax from the previous year.

Answer 2

Most Expats have bank accounts overseas, which they can keep as offshore accounts. When an UK National moves back he/she will have to declare any INTEREST that earned. Any tax due on this interest must then be paid to the Inland Revenue. The EARNED tax free salary will stay tax free

Smart Expats invest in  offshore investment bonds. This 'tax wrapper' defers income and capital gains tax, if structured correctly the bond can allow an Expat to draw a tax-free income into the UK.

Most Western Expats negotiate salary packages incl. housing, transportation, often school fees etc. Therefore it is possible to save some good money and tax has to be paid only on the interest gained.

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