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Friday, Oct 03, 2025

Will the chance to retire in Dubai appeal to British expats?

Will the chance to retire in Dubai appeal to British expats?

Arabian Business asks the experts whether the emirate's new retirement visa will be an attractive option for UK citizens

The UK and Dubai have long enjoyed a close relationship, with historical, cultural and trade ties stretching back decades. Around 240,000 British expats called Dubai home in 2012, according to the most recent official figures.

Following the news that the emirate launched a retirement programme earlier this month for resident expats and foreigners over the age of 55, many British citizens will likely be wondering if it’s a viable option for their future.

Retire in Dubai, the first programme of its kind in the region, is being spearheaded by Dubai Tourism in collaboration with the General Directorate of Residency and Foreigners Affairs (GDRFA-Dubai).


Eligible applicants will be provided a retirement visa, renewable every five years. The retiree can choose between one of three financial requirements for eligibility: earning a monthly income of AED20,000 ($5,500); having savings of AED1 million ($275,000); or owning a property in Dubai worth AED2m ($550,000).

In its initial phase, the programme will focus on UAE residents working in Dubai who have reached retirement age.

But what will Dubai retirement mean specifically for British expats and would they have to forgo their state pension benefits? Arabian Business asked the experts...

Is Dubai retirement a good option for British expats?


According to Keren Bobker, senior partner and independent financial adviser with Dubai-based Holborn Assets, the benefits of retiring in Dubai are fewer for Brits than for some other nationalities – owing to perks such as the UK’s National Health Service – but there will be benefits in some cases, largely dependent on where individual retirement incomes will come from.


“If someone’s income in retirement is going to largely be the UK’s State Pension, other UK pension plans, or UK property income, that will all be taxed in the UK, as it is what is referred to ‘income arising in the UK’,” Bobker explains. “However, if someone has an offshore pension or certain offshore or non-UK investments, then in most cases there will no or little tax to pay as a UAE resident.”

Will retiring Brits still be able to receive their state pension in Dubai?


Bobker says the UK’s State Pension is payable to anyone who is entitled to receive it, no matter where they are living at the time.

“What anyone retiring in the UAE needs to be aware of is that these payments will not be indexed in payment, as they would be for someone living in the UK, European Economic Area, or a handful of places with a reciprocal arrangement. This means that in real terms the value of the pension payments will effectively reduce due to the effect of inflation,” she says.



“For this reason, the country of residency at the time the UK’s State Pension is payable is something we consider when looking at if it is worthwhile to make voluntary National Insurance payments when living in the UAE, as part of proper retirement planning.”

What are tax benefits of Dubai retirement for UK retirees?


According to Martyn Davies, managing director, MHD Wealth Management, the main financial benefits of retiring in Dubai are related to tax.

“In the UK income payments from a pension are subject to the same income tax rates as employment income. However, if you're resident in the UAE, it is possible to withdraw money from your UK pension without having to pay any income tax in the UK,” Davies says.


“Once you reach pensionable age, normal UK pension rules allow 25 percent of your pension to be paid tax free in a lump sum, with the remaining 75 percent subject to income tax in the UK. The rate of taxation is dependent on your tax bracket and income level,” the finance expert explains.

However, due to a tax treaty signed between the UK and United Arab Emirates, which came into force in December 2016, payments received from a UK pension plan by a resident of the UAE, will only be subject to tax in the UAE.

As the UAE does not tax personal income, it means no tax will be payable on UK pension payments.

“You will need to inform your pension scheme as well as HMRC that you are no longer UK tax resident so they don’t deduct any tax from your pension payments,” advises Davies.



The expert advises completing a P85 and submitting it to HMRC to confirm any change in status. However, he also advises a note of caution with regard to the temporary non-resident rules.

“If you were to return to the UK within five years of moving to the UAE and had been tax resident in the UK for at least four of the seven previous tax years, then you will be classed as a ‘temporary-non resident’.

“If this were to happen then tax benefits received on flexible drawdown payments from your UK pension will be subject to tax on your return to the UK.”

Davies added that Dubai expats in receipt of public sector or government funded pensions, such as teachers or the armed forces, would continue to be taxed as normal in the UK, wherever they retire in the world.

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