A main attraction for doctors relocating to work in the United Arab Emirates is that there is no income tax. Your take-home pay is the same as your salary.
At Allocation Assist, some doctors relocating from Britain have asked if their income will be taxable in their home country. The short answer is no, but read on for more precise details.
Do I have to pay tax on income earned in Dubai?
If you are a resident and have been working in the UAE for at least one full tax year and meet the requirements for non-resident status in Britain, you will not be taxed on any income earned outside the country. Non-residents (or expats) are only liable for tax on income earned in Britain. Maintaining GMC registration while working in the UAE is crucial for ensuring compliance with both local regulations and your home country’s requirements. This means that expatriates need to stay informed about the specific obligations that come with their registration status. Maintaining GMC registration while working in the UAE not only helps in upholding professional standards but also opens doors for future career opportunities both locally and abroad.
Non-residence status is assessed on a tax-year basis (6 April to the following 5 April) and should apply if you are working full-time in the UAE and do not stay in the country for more than 90 days or work there for more than 30 days within the tax year. However, if you relocate for less than a full tax year, you will remain a UK resident for tax purposes and be liable to pay UK tax on foreign income.
How can I make sure that I have non-resident status?
You must inform HMRC when you are leaving the country to live abroad. If you usually complete a self-assessment tax return, you will need to report your residency status to HMRC on your tax return. If you do not usually complete a self-assessment tax return, you need to fill out form P85 online. If you are unsure about your UK residence status, you can check this website
Will I have to pay tax if I transfer money back home?
While you have non-resident tax status, all your earnings outside Britain are legitimately tax-free. You are not liable to pay any tax on these earnings when you transfer them to a domestic account. This is determined by your residence status when the income was earned, not when it was transferred.
The Statutory Residence Test (SRT)
HMRC uses the Statutory Residence Test, introduced in 2013, to determine whether you are UK-resident for a given tax year. It works in a sequence of three stages: the automatic overseas test (which can make you automatically non-resident), the automatic UK residence test (which can make you automatically UK-resident), and the sufficient ties test (which weighs your UK connections against the number of days you spend in the UK).
For most doctors leaving the UK for a full-time job in Dubai, the automatic overseas test is the relevant route, you typically meet it if you work overseas full-time for the tax year and spend fewer than 91 days in the UK, with fewer than 31 of those being days when you work in the UK. Each person’s circumstances differ, so HMRC’s SRT guidance is the authoritative reference, and a qualified UK tax adviser should review your specific position before you leave. How UK doctors get jobs in Dubai often involves navigating foreign medical licensing requirements and understanding local labor laws.
Filing form P85 notifies HMRC that you have left the UK, but it does not by itself determine your residence status. Residence is determined by the SRT, and split year treatment, where it applies, is claimed separately through your Self Assessment return.
Split year treatment if you leave mid-year
If you leave the UK part-way through a UK tax year (6 April to 5 April), split year treatment can divide that year into a UK-resident part and an overseas part, so you are only taxed on UK-source income for the period after you leave. This is claimed through the SA109 supplementary pages of your Self Assessment return, not through the P85. The most common qualifying conditions for doctors are starting full-time work overseas (HMRC’s Case 1) or ceasing to have a UK home (Case 4). The rules are detailed and your individual situation matters, so confirm with an adviser before claiming.
Do I have to pay other taxes?
As a non-resident, you may be liable for Capital Gains Tax (CGT) if you sell domestic property or land at a profit or on rental income for a property that you own back home. As a non-resident, you are not liable for Capital Gains Tax on other assets or property abroad unless you relocate back and become a resident within the same tax year. It is possible to apply to get your rental income paid without deduction of tax by registering as a non-resident landlord.
Do I have to pay National Insurance?
As a non-resident, you do not have to pay National Insurance (NI) contributions on income earned outside the country. However, a significant amount of time spent working abroad could affect your entitlement to the state pension and other benefits should you return. It is possible to make voluntary NI contributions to make up for any gaps if this is a concern.
You can check your National Insurance record on the government website.
Read Also:
- Guide to Obtaining a Residence Visa in Dubai
- Career Opportunities for Doctors in Saudi Arabia
- What is it like to live in Riyadh?
- Why Invest in Property in Dubai?
- 10 Key Benefits for Doctors Working in Dubai
What happens if I return home?
It is important to seek professional tax advice when you are considering returning home. Plan your international relocation at least 18 months before returning. Your tax liability changes when you lose non-resident status. Consider tax advice for a “split-year” if you spend time in both countries during a tax year. Temporary non-residence rules may apply if you’ve been an expat for less than five years. Then potentially requiring tax payment on gains realized during your absence. This should not be the case if you have been a non-resident for five years or more.
For more information on returning, see this website: GOV.UK
There are opportunities within the dynamic and growing UAE healthcare sector for Western-trained doctors with the right qualifications, skills, and experience. Contact Allocation Assist today
References: https://nichols.co.uk/news/moving-to-dubai-uk-tax-implications/
Is it possible to retire here?
Yes, as long as you have enough savings. In 2020, the local government introduced a new retirement visa. To apply for the retirement visa, you must be at least 55 years old and have either a monthly income of AED 15,000 or more, savings of at least 1 million AED, own an unmortgage property valued at least 2 million AED, or at least 2 million in assets split between savings and property. You also need a health insurance policy that meets the requirements for the UAE retirement visa.
Dubai is now a place where ex-pats can build a long-term home
The city is considered a safe and attractive destination for expats, especially given the chance to earn a tax-free salary. New visa and residence schemes also encourage doctors and other healthcare professionals to make it their home for the long term. By saving wisely and investing in property, it is even possible to retire there.
An important note
The information here is a general guide for doctors considering a move to Dubai. UK tax residence and overseas income rules are detailed, and the right answer depends on your individual circumstances, the time you spend in the UK, your remaining UK ties, the timing of your departure, and any UK-source income you keep. Before you make plans, take advice from a qualified UK tax adviser who can review your specific position.
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