{"id":1763,"date":"2020-11-03T03:30:06","date_gmt":"2020-11-02T23:30:06","guid":{"rendered":"https:\/\/moneymall.ae\/credit-blog\/?p=1763"},"modified":"2020-11-03T11:20:16","modified_gmt":"2020-11-03T07:20:16","slug":"income-tax-in-uae","status":"publish","type":"post","link":"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/","title":{"rendered":"A quick guide to Income tax in UAE"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Understanding a foreign tax system might not be a cakewalk for most people out there. However, things become easier when you realize that there is no income tax levied on the citizens and residents of UAE ! This is one of the most popular reasons why expats want to settle down with their businesses and careers in Dubai. Follow this article closely to know everything you ever have to know about the income tax situation in Dubai and how it functions.<\/span><\/p>\n<blockquote>\n<h1><span class=\"ez-toc-section\" id=\"Quick_fact_The_UAE_does_not_levy_income_tax_on_individuals\"><\/span>Quick fact : The <b>UAE<\/b>\u00a0does not levy income\u00a0<b>tax<\/b>\u00a0on individuals<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<figure id=\"attachment_1780\" aria-describedby=\"caption-attachment-1780\" style=\"width: 421px\" class=\"wp-caption alignleft\"><a href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/pexels-karolina-grabowska-4386367\/\" rel=\"attachment wp-att-1780\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-1780\" src=\"https:\/\/moneymall.ae\/credit-blog\/wp-content\/uploads\/2020\/11\/pexels-karolina-grabowska-4386367.jpg\" alt=\"income tax in uae\" width=\"421\" height=\"280\" \/><\/a><figcaption id=\"caption-attachment-1780\" class=\"wp-caption-text\">income tax in uae<\/figcaption><\/figure><\/blockquote>\n<pre><div id=\"ez-toc-container\" class=\"ez-toc-v2_0_79 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3df02f9c389\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3df02f9c389\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#Quick_fact_The_UAE_does_not_levy_income_tax_on_individuals\" >Quick fact : The UAE\u00a0does not levy income\u00a0tax\u00a0on individuals<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#Introduction_to_Tax_in_UAE\" >Introduction to Tax in UAE.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#What_kinds_of_income_are_taxable_in_UAE\" >What kinds of income are taxable in UAE?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#How_does_Dubai_handle_expenses_if_there_are_no_taxes\" >How does Dubai handle expenses if there are no taxes?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#What_are_some_of_these_other_taxes_that_are_levied\" >What are some of these other taxes that are levied?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#Is_there_a_direct_tax_on_my_income_at_all\" >Is there a direct tax on my income at all?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#Do_I_have_to_pay_a_tax_if_I_am_a_UAE_citizen_working_elsewhere\" >Do I have to pay a tax if I am a UAE citizen working elsewhere?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#What_do_we_mean_by_the_Double_Taxation_Agreement\" >What do we mean by the Double Taxation Agreement?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/moneymall.ae\/credit-blog\/income-tax-in-uae\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<\/pre>\n<h2><span class=\"ez-toc-section\" id=\"Introduction_to_Tax_in_UAE\"><\/span><strong>Introduction to Tax in UAE.<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The fact that there is no income tax levied in UAE does not mean that there are no taxes in UAE at all. No, that is not the case. Although expats might not have to pay tax on their direct earnings in Dubai &amp; UAE , some expats have to pay a tax on the same somewhere else in the world i.e. their home country. This implies that their income is taxable in their home country. The Dubai tax system is incredibly favourable for the residents of Dubai. However, that is not the case for people who have moved there for business purposes.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_kinds_of_income_are_taxable_in_UAE\"><\/span><strong>What kinds of income are taxable in UAE?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">In the United Arab Emirates, there are some laws that apply centrally to all the Emirates, and there is some liberty that is given to the Emirates to formulate laws themselves. For instance, the double taxation agreement is set by the UAE on the UAE as a whole, but the actual taxes that the residents of each Emirate have to pay may be decided by the Emirates themselves.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In Dubai, however, individuals are not directly taxed on their income. This implies that if you are a resident of Dubai, you are not liable to pay anything to the authorities with regard to the earnings you are making through your business or your job.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, there are certain caveats to this liberty. Just because you don\u2019t have to pay any taxes to the authorities in Dubai with regard to your income, this does not mean that you are not liable to pay taxes to authorities anywhere else. You might be liable to pay a tax in your home country with respect to the earnings you make while you transact in Dubai. Dodging or not being aware of such rules might attract heavy fines and penalties on you or your business, which might cost more than the taxes themselves. Hence, it is very important to keep that in mind.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_does_Dubai_handle_expenses_if_there_are_no_taxes\"><\/span><strong>How does Dubai handle expenses if there are no taxes?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Since Dubai has a lot of expenses of its own and there is no income tax, it seems reasonable to assume that the Emirate must have another income source. It does. The Emirate of Dubai primarily functions on financial grants from the Central Government and\/or the fees charged elsewhere (other than income taxes). Since the residents use various communal facilities provided to them by the country (like roads and pavements), taxes are exacted from the residents to pay for the construction and maintenance of these assets.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_are_some_of_these_other_taxes_that_are_levied\"><\/span><strong>What are some of these other taxes that are levied?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Although there is no income tax that is levied on the citizens of Dubai directly, there are a host of other channels through which the government of Dubai exacts its taxes. The main taxes that are paid to the government by the citizens relate to real estate. This tax is applicable to the citizens whenever a sale of a property or the purchase of a property is made. Excise duty that is applicable to the sale of fizzy beverages, energy drinks, and tobacco products also constitute a big amount of the income of the government. There is also a nominal VAT (Value Added Tax) that is applicable to the sale and purchase of goods and services in Dubai. These taxes are a little heavier than they are expected to be. But then, since there is no income tax on the citizens, they are expected to pay a little more to indulge in these luxuries and\/or business dealings.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Is_there_a_direct_tax_on_my_income_at_all\"><\/span><strong>Is there a direct tax on my income at all?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">No, the government of Dubai does not levy a direct tax on your income. There is a 0% tax to be paid by you to the government. There are no direct taxes levied on your income or your wealth in Dubai.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Do_I_have_to_pay_a_tax_if_I_am_a_UAE_citizen_working_elsewhere\"><\/span><strong>Do I have to pay a tax if I am a UAE citizen working elsewhere?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">If you are someone who is a legal citizen of Dubai but is working overseas, there are a host of factors that you need to consider. While you may not have to pay taxes in the United Arab Emirates on the income you earn overseas, the tax laws of the country you reside in might apply to you. To find out more about the tax situation in the country you work in, visit the official website of the government, or visit the local immigration center for more details.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_do_we_mean_by_the_Double_Taxation_Agreement\"><\/span><strong>What do we mean by the Double Taxation Agreement?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The double taxation treaties are set in place in the United Arab Emirates with other countries so that individuals who are working in one of the Emirates do not have to pay double taxes on their income, that is, both in their home country and in the United Arab Emirates. These treaties have been set up by the United Arab Emirates with other countries. Some of these countries are- India, Guinea, Bulgaria, Cameroon, Canada, China, Rwanda, United Mexican States, Uruguay, Uzbekistan Senegal, Serbia, Macedonia, Luxembourg, Libya, and Finland.<\/span><\/p>\n<h2><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span><strong>Conclusion<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Hence, as you already know, there are no income taxes levied on the citizens of Dubai. Amazing, right? Dubai is a tax-free haven for expats who need to settle in a place where most of their income is not taxed by their government. Hence, for businessmen and officials who need a country where taxes are not strict and not stringent, the Emirate of Dubai in the United Arab Emirates looks like a perfect choice.<\/span><\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Understanding a foreign tax system might not be a cakewalk for most people out there. However, things become easier when [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":1764,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[8,7],"tags":[456,452,453,451,455,454],"class_list":["post-1763","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-saving-money","category-news","tag-income-tax","tag-no-income-tax","tag-save-income-tax","tag-tax-in-dubai","tag-tax-in-uae","tag-uae-tax"],"_links":{"self":[{"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/posts\/1763","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/comments?post=1763"}],"version-history":[{"count":4,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/posts\/1763\/revisions"}],"predecessor-version":[{"id":1783,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/posts\/1763\/revisions\/1783"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/media\/1764"}],"wp:attachment":[{"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/media?parent=1763"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/categories?post=1763"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/moneymall.ae\/credit-blog\/wp-json\/wp\/v2\/tags?post=1763"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}