# Advice for a new expat?



## jj2006 (Nov 1, 2015)

Can I get advice. I am considering to move to AD/Dubai in the next 2 years, I am trying to finish my masters first. However what advice can I get in terms of what to expect, whats the good, the bad, Is it truly 0% tax for those with american passports. However I hear expats can't buy property or property is more expensive than for UAE citizens?


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## Fat Bhoy Tim (Feb 28, 2013)

You file taxes. Whether you pay depends on what you earn. You can earn quite a lot here before you'll need to pay taxes. 

Cost of living is probably a lot higher than all but the most expensive US metros. 

Property ownership is also convoluted and confusing. Just because you bought something doesn't mean you actually own it.


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## XDoodlebugger (Jan 24, 2012)

In 2015 the first $100,800 you make is exempt from US taxes (it goes up every year), you then add any other deductions (yourself, kids, house, etc) that can get that number somewhat higher. The tax is on income and benefits, so if you make $90k and have a $35k housing allowance then that might push you into taxable range in the 28% bracket. There are other tax voodoo things going on so in my opinion it is important to have an expert handle this issue for you.

There is no income tax here in the UAE, so nice to see the bottom line of your check matching the top line! 

I debated buying a condo here but the tax on that put me off a bit and I think the market is too high right now anyway.


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## Fat Bhoy Tim (Feb 28, 2013)

XDoodle****** said:


> In 2015 the first $100,800 you make is exempt from US taxes (it goes up every year), you then add any other deductions (yourself, kids, house, etc) that can get that number somewhat higher. The tax is on income and benefits, so if you make $90k and have a $35k housing allowance then that might push you into taxable range in the 28% bracket. There are other tax voodoo things going on so in my opinion it is important to have an expert handle this issue for you.
> 
> There is no income tax here in the UAE, so nice to see the bottom line of your check matching the top line!
> 
> I debated buying a condo here but the tax on that put me off a bit and I think the market is too high right now anyway.


The rental write-off for Abu Dhabi and Dubai around about 45-50K USD. Or they were when I last checked in 2013. Fairly sure it was applicable whether you were "self-employed" or not.


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## GloballyRelaxed (Nov 5, 2014)

57k in 2014 tax year.


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## Fat Bhoy Tim (Feb 28, 2013)

GloballyRelaxed said:


> 57k in 2014 tax year.


Which city though? I remember they're different.


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## GloballyRelaxed (Nov 5, 2014)

Fat Bhoy Tim said:


> Which city though? I remember they're different.


Apologies, should have noted that one. The 57k figure is for Dubai.


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## jj2006 (Nov 1, 2015)

Hello thank you for your response.
Right I do think the cost of living is higher but is it higher in terms fo the price of food, rent on property and leases on vehicles? Whats the rule before you have to pay taxes? Such like tax-free for 5 years then 28% off tax depending on your income bracket? I didnt find information on this..

Enlighten me on what you mean by just because you bought it doesnt mean you own it? I am assuming the royal family typically own everything.. So this is what you mean by you dont technically own it? as compared to the US



Fat Bhoy Tim said:


> You file taxes. Whether you pay depends on what you earn. You can earn quite a lot here before you'll need to pay taxes.
> 
> Cost of living is probably a lot higher than all but the most expensive US metros.
> 
> Property ownership is also convoluted and confusing. Just because you bought something doesn't mean you actually own it.


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## jj2006 (Nov 1, 2015)

Can I kindly personally message you? I am quite lost here about UAE. First off do people live in Dubai or they live outside of dubai and go there for the weekends?

Regarding the taxes so you are saying if you are making up to 100K in total income then your 0% tax benefit goes away and there after you pay taxes there on? Interesting to no.... I am not sure why everyone is saying 0% tax if you go to UAE as a expat.

I know that you get medical, insurance, children/school benefits, housing, and cars with an income and such however whats the truth here about buying property, and your taxes even if you make a god income per year?

I hear you wont buy a property at a good price if you are not a UAE citizen?



XDoodle****** said:


> In 2015 the first $100,800 you make is exempt from US taxes (it goes up every year), you then add any other deductions (yourself, kids, house, etc) that can get that number somewhat higher. The tax is on income and benefits, so if you make $90k and have a $35k housing allowance then that might push you into taxable range in the 28% bracket. There are other tax voodoo things going on so in my opinion it is important to have an expert handle this issue for you.
> 
> There is no income tax here in the UAE, so nice to see the bottom line of your check matching the top line!
> 
> I debated buying a condo here but the tax on that put me off a bit and I think the market is too high right now anyway.


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## jj2006 (Nov 1, 2015)

I do want to ask do people live in exactly Dubai or outside dubai? I am trying to figure out if the packages are real for expats going to UAE.. However if UAE offers good benefits how about Qatar / AD?


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## TallyHo (Aug 21, 2011)

1. People live in Dubai. It's not like a typical American or British city with one city centre, two or three satellite centres and surrounded by rings of suburbs. You either live in Dubai or you don't (meaning you commute from Sharjah). If you look at google maps, Dubai is long and narrow along the coastline and amenities and residential areas and work places are more or less equally distributed across the entire "city."

2. British expats pay 0% taxes. Americans are not so lucky  The actual tax free benefits of the UAE is due to that the UAE does not levy income taxes but as citizen of your home country you are still subject to the tax laws of that country. UK doesn't collect income tax on British expats living overseas. Americans provide an exclusion up to $100K. Some nationalities still have to pay full income tax as per their country's tax policy.

3. The benefits you refer to is entirely up to your employer. Few people get all the benefits you describe and more and more companies are moving to an all-inclusive package offer with only health care beyond that. 

4. You can buy property here. But "owning" isn't tantamount to the same ownership rights you get in the USA. There's nothing to prevent the local authorities from taking away your property if they want to. At this point in time they will compensate you for it, but who knows what might change in the future. The laws of this country are strictly for the benefit of Emiratis and the rest of us are subject to its whims.

As a new market, the property sector is heavily prone to wild swings in value. It's the wild, wild west. Some people have made fortunes, others have lost a great deal. 



jj2006 said:


> Can I kindly personally message you? I am quite lost here about UAE. First off do people live in Dubai or they live outside of dubai and go there for the weekends?
> 
> Regarding the taxes so you are saying if you are making up to 100K in total income then your 0% tax benefit goes away and there after you pay taxes there on? Interesting to no.... I am not sure why everyone is saying 0% tax if you go to UAE as a expat.
> 
> ...


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## jj2006 (Nov 1, 2015)

So people typically live in Sharjah, Fujairah, Jamairah but commute all around the Dubai? I am not sure where people are most commonly living in Dubai.

Wow nice to know only british expats pay 0% without restrictions.. Can I find more information about expats in UAE and their restrictions, regulations/law? I am able to get a saudi nationality but I have chose not to would this be beneficial?

Thanks for clearing up the benefits is up to my employer. Do they just give you benefits ay 2-3 years then cut you off after that. I hear most companies if not all give you benefits (medical, kids/school, housing, car) and allowances but I dont know what they mean by allowances if its for personal need.

I understand now what you mean by buy property as in the US what you buy can't be taken away by the government thanks to the bill fo rights. However I doubt they would ever over-take your property or personal belongings maybe people are too paranoid about their rights there.



TallyHo said:


> 1. People live in Dubai. It's not like a typical American or British city with one city centre, two or three satellite centres and surrounded by rings of suburbs. You either live in Dubai or you don't (meaning you commute from Sharjah). If you look at google maps, Dubai is long and narrow along the coastline and amenities and residential areas and work places are more or less equally distributed across the entire "city."
> 
> 2. British expats pay 0% taxes. Americans are not so lucky  The actual tax free benefits of the UAE is due to that the UAE does not levy income taxes but as citizen of your home country you are still subject to the tax laws of that country. UK doesn't collect income tax on British expats living overseas. Americans provide an exclusion up to $100K. Some nationalities still have to pay full income tax as per their country's tax policy.
> 
> ...


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## Nursemanit (Jul 10, 2015)

Americans usually live in certain areas of Dubai ( Dubai Marina , JBR , Palm, JLT) you will not like Sharjah. Also for an American you usually will not want to buy property with the 57k rental tax credit the tax math usually works out better renting.


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## TallyHo (Aug 21, 2011)

Jumeirah is a residential area within Dubai.

No one lives in Sharjah and Fujairah and commutes to Dubai unless they absolutely have to (because they can't afford Dubai).

If you're trying to ask if it's a car-oriented city, then yes, it is.

Where do people "most commonly living in Dubai" - if I understood the question (it's not written in proper English but I'll give you some leeway as it's clear you're of Saudi origins) the answer is all over the place. If you want young western expats, they are more commonly found on the south side of Dubai (Downtown, Dubai Marina, JLT, Greens, TECOM, Sports City and so on). 

You only avoid US taxes by surrendering your US citizenship. Having dual nationality only exposes you to taxation from two countries, although the more expensive will usually overrule the lower taxing country so you're not necessarily doubling up on taxes (assume you have two citizenships in Country A with 40% tax rate and Country B with 20% tax rate, Country A will require you to pay the 40% but allow you to deduct the 20% you need to pay to Country B, or Country B will allow you to avoid paying the 20% because you need to pay 40% to Country A. But it does come down to what two countries we're discussing and unfortunately US tax laws are among the most inflexible and most ungenerous in the world). 

I don't have a lot of time today but I will give you a concise explanation on benefits. In the "old days" it was the standard for a professional expat to be given a package consisting of a base salary + housing allowance + health insurance + school fees + transportation allowance + annual flights home. Quite often the housing would be paid directly by the company, as well as the school fees.

Today you may still get a package offer based on the benefits structure I outlined above, but it's more common for those benefits to be given a certain value and broken down on a monthly basis, so each month you would get your base salary + 1/12 of the housing allowance + 1/12 of the school fees and so forth. Health insurance and annual flights still paid separately. Sometimes the employer will give you the school fees and full housing allowance up front. Ultimately, you are not financially better off at the end of the year because it's the same money, just paid differently, although having housing allowance and school fees up front makes it much easier, but it does come with a risk because if you leave a job midway through a contract, you owe your company the remaining housing allowance already paid to you.

Some companies have done away with the benefits breakdown and just give people a full lump sum each month. That's what I have (plus health insurance and annual flight). Why is this preferable? Because my end of service gratuity is based on my entire package, whereas if I still had the traditional package breakdown the EOS would only be based on the base salary, which would be between 50-70% of the overall package value. 

The US has a law called eminent domain, which does allow the government to seize your property if it's needed for the public good, but you will be fully compensated for it. The UAE doesn't. It can just take the property or revise the laws that restrict ownership access to the property. For example, buying a property here doesn't give you rights to citizenship at all. If you had Saudi citizenship you actually have more flexibility in owning property in the UAE as you would be allowed to buy outside the freehold areas. On the whole, buying a property here is a minefield and one to be very carefully approached. 




jj2006 said:


> So people typically live in Sharjah, Fujairah, Jamairah but commute all around the Dubai? I am not sure where people are most commonly living in Dubai.
> 
> Wow nice to know only british expats pay 0% without restrictions.. Can I find more information about expats in UAE and their restrictions, regulations/law? I am able to get a saudi nationality but I have chose not to would this be beneficial?
> 
> ...


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