QROPS United Arab Emirates. Pension Tax Relief
British expats living in the United Arab Emirates or wishing to retire in Dubai can now transfer their pension into a QROPS United Arab Emirates to maximize pension tax relief. British expats living or working in United Arab Emirates can take advantage of their offshore status and transfer their UK pension offshore to somewhere secure like New Zealand, Malta or Gibraltar and will no longer have to pay UK taxes on their pension as long as you stay offshore.
Even residents and citizens of United Arab Emirates who have worked in the UK can also transfer their pension to avoid UK taxation.
Why live in the United Arab Emirates (UAE) as a British expat?
Over 60,000 Brits live and work in United Arab Emirates. There are many nursing jobs, oil & gas jobs, engineering jobs, teaching jobs, nanny jobs, security jobs, call centre jobs, accounting jobs, financial jobs, aviation jobs and telecommunications jobs in the uae. The facilities and infrastructure is like the developed world in Dubai. The United Arab Emirates (UAE) and especially Dubai, is becoming an ever more popular destination for British expat retirees. There is no income tax for British expats in Dubai or the United Arab Emirates.
The impressive array of accommodation and restaurants, hot climate, beaches, job opportunities, zero personal income tax rate and proximity to the UK make it an increasingly popular choice for some British expats in retirement. A QROPS Specialist can help you choose the best jurisdiction to hold your pension to avoid UK taxes, whilst ensuring the lowest fees possible.
The Emirates Security and Commodities Authority is currently drafting new rules with proposals restricting the promotion of funds in the jurisdiction without UAE central bank approval. However, this only applies to Dubai based QROPS. A QROPS in the Isle of Man of Guernsey is not within reach of UAE’s regulatory arm. This allows a wider range of funds to choose from, whilst still avoiding UK taxes on your pension. A QROPS United Arab Emirates which is a pension transfer into a QROPS in NZ, Malta or Gibraltar avoids all UK taxes as well as any taxes in NZ, Malta or Gibraltar or in Dubai or the Arab Emirates. QROPS are great vehicles to maximize tax efficiency. If you are working in Dubai, you can take advantage of this opportunity to move into a QROPS United Arab Emirates as soon as possible to stop you getting taxed on any future UK tax increases.
Most Brits moving to Dubai worry most about the alcohol policy in Dubai.
Drinking alcohol in Dubai. Is it legal to drink in the UAE?
It is a criminal offence to have liquor in your car or home if you do not have a valid liquor license. Many people are unaware of this and many have been fined or imprisoned. You can buy alcohol at duty free or Barracuda but it is illegal to have it if you have no license.
Alcohol is available in Dubai but not everywhere. Restaurants, bars and nightclubs attached to the hotels serve alcohol although on certain religious holidays the sale of alcohol is not allowed. It is illegal in Dubai to serve or sell alcohol to Muslims.
To buy alcohol to drink at home you need either a liquor licence or you can buy duty free on your arrival in to Dubai. Duty free allowance for non-Muslims only is 2 litres of spirits and 2 litres of wine per person. If you are transporting alcohol in the car you must have your liquor license and the purchase receipt for the alcohol on your persons.
It is against the law to drink alcohol in public places e.g.: in the street, in the desert or at the beach. During Ramadan, only hotels can serve alcohol and then it is only allowed to serve after 7pm. Proportionally, Britons are more likely to be arrested in the UAE than in any other country in the world. Alcohol in Dubai attracts a 30% sales tax.
What is the currency in the UAE?
The UAE currency is the Dirham. 1 Pound Sterling = 5.75 UAE Dirham (Sep 19th 2011). When you decide to transfer your pension to a QROPS United Arab Emirates, you can decide to keep your pension into GBP or change into USD or EUR.
For the Brits living in United Arab Emirates, you can take advantage of your offshore address to reduce UK tax on your pension as well as protect your wife and children from high UK taxation should anything happen to you by transferring to a QROPS United Arab Emirates.
What are the Benefits of a QROPS United Arab Emirates?
What are the benefits of a QROPS United Arab Emirates Pension Transfer for British expats?
• Avoid UK income tax
• Avoid UK dividends tax
• Avoid UK capital gains tax (CGT)
• Avoid UK inheritance tax (IHT)
• Currency choice. You can choose to have your pension transferred to a QROPS denominated in USD, EUR or keep it in GBP
• Have the ability to make higher returns with freedom of investment
• Family Protection: Upon death, the entire pension pot gets passed on to your nearest and dearest
• Security: The pension is held in a secure jurisdiction such as NZ, Malta or Gibraltar which have their own strong financial regulations which are tax efficient
What is a QROPS United Arab Emirates?
A Qualifying Recognized Overseas Pension Scheme (QROPS United Arab Emirates) allows your UK pension to be transferred offshore to reduce your tax burden. Effectively, you will no longer pay UK tax on your pension whilst you are offshore and after 10 years of living offshore, the reporting requirements to HMRC cease.
If you are living in United Arab Emirates at the moment, you can take advantage of your offshore address in order to move your UK pension into a QROPS United Arab Emirates to avoid further UK taxes down the line. A QROPS United Arab Emirates is the perfect vehicle to avoid UK taxes if you are considering living or retiring abroad
What are the taxes for British expats in United Arab Emirates?
Foreign banks are subject to a 20% corporation tax on profits earned in the emirates of Abu Dhabi, Dubai, and Sharjah (according to government.ae, the UAE government website). Local banks do not have any UAE tax bills.
Oil companies are subject to a 55% tax rate in Dubai and 50% in other emirates, in addition to royalties. A PricewaterhouseCoopers (PWC) report (Global Effective Tax Rates 14 April 2011) rated the UAE as the country having the second lowest effective corporate tax rate for 2006-2009 for international or foreign companies.
General import duty is 10% on luxury goods, and 4% on everything else, except alcohol which has a 30% sales tax.
What Tax Would I Pay on My QROPS if I live in United Arab Emirates?
If you retire in the UAE, your tax bill would be zero in the UAE and the UK. It would also be zero in Malta and New Zealand. The Gibraltar QROPS would have a 2.5% income tax charge.
Can I Transfer My UK Pension to a QROPS in the United Arab Emirates?
Do I need to move my pension to United Arab Emirates?
No. There is no QROPS in the UAE at the moment. Your pension can be transferred to a secure jurisdiction such as NZ, Malta or Gibraltar where it will be out of the UK tax system and your pension will be paid gross and grow tax free.
Do I need to live and retire in United Arab Emirates?
No, you can live anywhere offshore. As long as you are outside the UK, your QROPS will grow free of UK tax. If you ever return to live permanently in the UK, your pension will simply return to UK Self Invested Pension Plan (SIPP) rules.
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Pension tax relief for British expats moving to the QROPS United Arab Emirates article written by QROPS Specialists.QROPS United Arab Emirates Pension Transfer for British Expats to Avoid Paying Taxes by Richard Malpass