Dubai itself has zero income tax, a lot of Brits work and live in the UAE, especially Dubai.
If you are working full-time in Dubai the money you earn is tax-free, due to this, when you send your money to the UK you owe HMRC nothing on those earnings!
When you look at paying tax it is more about the country you are a tax resident at the time of those specific earnings.
The tax paying gets assessed on a yearly basis; for example, if someone were to go to Dubai for just 4 months on a contract but they spend the rest of that year in the UK they would still be a UK tax resident as they spent most of that year in the UK.
It would be a good idea to get some tax advice on a “split-year” if you spend a lot of time in both countries.
To put it shortly, no.
There is a cash limit of AED 100,000 that is for people that come and go however, there are no exchange controls in the UAE or UK when it comes to transferring money electronically, meaning bank to bank transfers.
As well as residents, non-residents are also permitted to move money freely between Dubai and the UK.
The banks sometimes set their own limits for online transfers and that differs depending on what bank you use. The daily limit would be a problem if you have the intentions to make large money transfers.
It can cost you more money and time as you would need to make more transfers to move a large amount of money; however, when you use a money transfer company, they do not normally have daily limits therefore, it might be the better opinion when looking at larger money transfers.
When transferring money from Dubai to UK there are two charges:
I will be using Emirates NBD and HSBC as they are the two major banks that are used by British expats in Dubai.
You need to keep in mind that every money transfer company have their own rates and fees and they differ from company to company.
When you are comparing costs, you need to ensure that you do it at around the same time as they change every few seconds, so you want the most accurate price.
The simple way to compare the costs is to find out the total amount of Pounds that you will get for your Dirhams.
The big banks usually charge their customers international transfers fees however, they sometimes get called different names such as ‘foreign currency remittance fee’ or ‘telegraphic transfer fees’.
This is what two of the major Dubai banks charge:
HSBC: AED 75 if you do it in the bank or AED 35 if you do it online.
Emirates NBD: AED 75 if you do it in the bank or its Free to do it online.
This may not seem like a lot of money, but a lot of expats transfer money every month back to the UK to pay their mortgages etc; therefore, when frequently transferring money to the UK from Dubai you can imagine transfer fees are really going to add up.
To avoid these fees a money transfer specialist would be your best option.
One thing to bear in mind is that there is never a standard exchange rate as a money transfer company, or a bank will offer different exchange rates.
A transfer of AED 100,000 to GBP, the exchange rate margin charged by Emirates NBD was 3.3% and HSBC was 3.2%; that seems like a high margin when you compare it to money transfer specialists.
HSBC tightens their margin as the amount of money gets larger, the margin on AED 1 million was 2.9%, which is still quite high.
A cost comparison can save you a lot of money; if you are transferring AED 350,000 and want to transfer the money from Dubai to the UK, an exchange rate of 1% would enable you to save over £2,000 (AED 8,000).
It is best to check that a money transfer company is regulated by the FCA (Financial Conduct Authority) before you use them as authorised companies are required to keep client’s money in a separate, safeguarded bank account to ensure its protection.
Your money will not be mixed with company funds and will only be used just for transfers. You can find out if a company is regulated by the FCA by looking on the FCA register.
Many customers search online for exchange rates, there are many companies that offer ‘live rates’ like XE and Daily FX however, the exchange rates that you see online are not available for customers.
In small print on the website, it will say something like “for information purposes only” or “consumers cannot access these rates”.
This is something called ‘interbank exchange rates’ these are used by banks to exchange money with themselves, even large firms cannot gain access to these rates.
To ensure you get an exchange rate you can use you need to request a quote from a provider.
Exchange rates are moving all the time, it is not easy for customers to pick the best time to exchange their Dirhams into Pounds, even tiny moves can cause a huge difference in the amount of Pound Sterling you will receive.
For example, a 1% move in the AED to GBP rate on an AED 500,000 transfer is a difference of AED 5,000, around £500. Moves of this size are regularly on a daily occurrence and you might not be watching the rates when they change, money transfer specialists can work alongside you to get you the best exchange rate possible.
If you are looking for a certain rate you could get an alert when that rate is available with a money transfer specialist, the better the rate the more money you will have in your back pocket!
It is good to keep in mind that not all money transfer companies offer this first-class service.
Usually, the larger the transfer the more the customer want someone to speak to, to make them feel at ease!
Regency FX are a UK based independent currency broker, specialising in high volume transfers.
We pride ourselves on our premium level of customer service, you will be allocated your own personal account manager whom you will have direct access to.
All funds transferred through Regency FX are made using client segregated accounts in accordance with the FCA (Financial Conduct Authority) guidelines.
The important thing is the comparison, online rates shown on Google and other search engines are not always accurate for the consumer.
They can often refer to the rates that banks exchange at rather than what is available to you, the customer.
Even if you are just looking for property at this stage it is worth getting in touch to discuss your options.
We can monitor the market on your behalf enabling you to budget more effectively.
As a first-class currency transfer service, here at Regency FX we endeavour to get the best available rate regardless of how much you are transacting.
Get a quote and see how we stack up.
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