Key Takeaways
- Understand your UK tax obligations before and after moving to the UAE.
- Establish solid banking, insurance, and pension strategies early on.
- Take control of UK-based assets like pensions and property to avoid common pitfalls.
- Long-term planning from day one is critical—especially with no UAE state pension.
- Working with a regulated financial advisor ensures a smooth financial transition.
Leaving the UK? What Every New Expat Needs to Know About Financial Planning in the UAE
As British professionals look to start a new chapter abroad, especially in up-and-coming destinations like the UAE with its appealing tax-free income, abundant career opportunities, and an international lifestyle, it is also important to understand that a fresh start doesn’t get your finances left behind.
During your first few months as an expat, you need to focus on establishing both financial stability for your lifestyle today and protection for your future. Every UK expat moving to the UAE should take account of the factors discussed below.
Understanding Your Tax Residency & UK Obligations
The UK’s HRMC continues to keep track of you, even if you have left the UK. If you earn a UK-based income, own property in the UK, or hold an investment in the UK, you are still liable to pay UK taxes. This depends on your residency status, determined by the Statutory Residence Test.
This test reviews:
- How many days do you spend in the UK?
- Your ties (property, family, work) to the UK.
- Whether you’ve been a UK resident in recent years.
Unintentional residence is a common problem. That is, if you spend over 90–120 days in the UK across several visits, HMRC may determine you’re a UK resident—bringing your international income back into the UK tax net.
However, the Double Taxation Agreement (DTA) between the UK and UAE functions to prevent the same income being taxed twice. Learning and applying these rules can be challenging, and getting personalized advice early on can help avoid any unexpected tax issues later.
Setting Up Your Financial Base in the UAE
Dubai presents an exceptional financial environment, with no income tax, expats have the ability to take a large portion of their earnings back home. But this also comes with a significant responsibility to manage, save, and plan effectively.
Key areas to focus on early:
- Banking: Open local AED accounts and understand how to manage international transfers (currency fluctuations can cost more than you think).
- Insurance: Health insurance is mandatory in the UAE. Consider additional coverage like life insurance or critical illness protection, especially if you have dependents.
- Pension Planning: Without a government pension system in the UAE, all retirement savings are self-initiated. If your employer provides a gratuity, learn about how it functions and how it can be supplemented with a long-term savings plan.
- Emergency Fund & Cash Flow Modelling: Use your initial months to build a 3–6 month safety net. Then, model out your income, lifestyle costs, and savings potential with an expert financial planner in the UAE.
Managing UK assets from Abroad
Many new expats leave the UK with multiple pensions, property, or ISAs, often without a clear plan. This can become a problem over time.
- UK Pensions: If you’ve had several UK employers, you likely have a few “stray” pensions. Combining multiple pensions into a single flexible pension (like a SIPP) can lower fees and improve control.
- ISAs: You can’t contribute to a UK ISA while non-resident, but you can keep your existing account and let it grow tax-free.
- UK Property: Be aware of non-resident landlord rules and possible capital gains tax (CGT) if you sell. Rental income remains taxable in the UK.
Many expats miss the chance to turn their assets to maximum benefit since they postpone taking requisite action. A structured review protects these funds and turn into your favour.
The Importance of Long-Term Planning from Day One
Although the United Arab Emirates provides a higher disposable income, there is no contingency plan in place for retirement, illness, or death. Your long-term strategy must be intentional from the start.
- Retirement Planning: Think global—your pension should be flexible enough to follow you wherever you live next. A well-structured retirement plan in the UAE is essential.
- Wills & Guardianship: UK wills don’t apply automatically in the UAE. Without a UAE-registered will, local Sharia law can take precedence over your intentions.
- Insurance: Beyond basic health coverage, make sure your income, assets, and family are protected with comprehensive policies. This becomes even more important in a country without a state safety net.
Wimbledon Wealth’s Role
Our specialized team at Wimbledon Wealth provides UK expats with essential financial guidance for a smooth transition. Our team of independent UK-qualified advisers leads you through every step of your financial journey starting with pension reviews and cash flow modelling then moving on to insurance structuring and estate planning.
If you’ve recently arrived in the UAE or are planning your move, now is the ideal time to review your finances. Our complimentary discovery meeting is your first step toward a structured and secure financial future.
Frequently Asked Questions (FAQs)
1. Can I keep contributing to my UK pension after moving to the UAE?
You can keep your UK pension, but your ability to contribute may be limited based on UK tax rules. Speak to an adviser about SIPPs and alternative options.
2. Do I need a will in the UAE if I already have one in the UK?
Yes. UK wills may not be recognised in the UAE. A locally registered will protects your assets and ensures guardianship for dependents.
3. What happens to my UK rental income after I become an expat?
It remains taxable in the UK. You may need to register for the Non-Resident Landlord Scheme and file UK tax returns annually.
4. Is it better to send money home or invest it in the UAE?
This depends on your goals, exchange rates, and market conditions. A financial planner can help you strike the right balance.