Within this blog, we explore the topic of financial advisors in Dubai: 

• Dubai and Abu Dhabi’s influx of wealth in 2022
• What taxes are there in the UAE?
• How to maximise your time in Dubai financially 
• How to find the right financial advisor in Dubai
• The importance of financial advice in Dubai
• Why you need to prioritise financial planning in Dubai

Wealth in Dubai

Dubai has quickly transitioned from a sleepy fishing outpost to one of the most advanced and affluent cities in the world. The extraordinary growth has led to the creation of vast amounts of personal wealth. Dubai continues to attract those with pre-existing wealth, seeking a low tax environment. Moreover, people head to Dubai with the hope of improving their financial prospects and building wealth.  

Dubai and Abu Dhabi’s influx of wealth in 2022

In the latest Henley Global Citizens Report, it was projected that 4,000 millionaires would migrate to the UAE in 2022, with the majority heading to Abu Dhabi and Dubai.

This projected figure stands to put the UAE ahead of all other millionaire hotspots, including Hong Kong, Singapore, Israel, the US, Switzerland, Canada, Monaco, New Zealand and the UK in terms of pull.

A section of the report written by New World Wealth claimed that total private wealth in the UAE totalled $966 billion. This figure includes 92,600 millionaires and 251 centi-millionaires with over $100 million in personal assets.

What taxes are there in the UAE?

The UAE is becoming the destination of choice for high-net-worth individuals and above for one main reason, tax. In the UAE, there is no income tax on salaries, investments, pensions or capital appreciation. This means the world’s wealthy can infinite amounts in tax by gaining tax residency in the Gulf Sheikhdom.

In the post-COVID world, where remote work has become an accepted norm, huge numbers of individuals are accessing their options with regards to tax residency. The UAE government, which funds itself using partly via a VAT model, has created a welcoming environment for the world’s wealthy by offering golden visas, straightforward company formation legislation and residency via property investment options.

Wealth management companies in Dubai 

The deVere Group is the leading wealth management company in Dubai. The company specialises in ensuring Dubai residents achieve and often exceed their financial goals. Below we explore some of the ways in which deVere Group assist clients in Dubai through the use of independent financial advice. 

Read about deVere’s 20-year success story.

Financial planning in Dubai 

Despite Dubai being a high-paying, tax-free city, not everyone manages to achieve their goals of wealth protection and creation. This can be due to several factors. These include poor tax planning, high personal expenditure, absence of insurance, or poor investment performance.     

deVere’s financial advisors in Dubai highlight certain opportunities and pitfalls that residents should be aware of:   

No automatic pension savings 

 The law in the United Arab Emirates does not include automatic pension enrolment. This means that during your time of employment in Dubai, your employer does not need to provide you with a pension. 

 Residents in the UAE often receive an enhanced income in comparison to what they could expect to receive in other countries. However, the higher income can be partly attributed to an absence of pension savings. Because of this, it is the responsibility of the individual to take action and save for their retirement. It is essential to set up a pension plan whilst you are in Dubai. 

 deVere’s financial planning team helps Dubai residents ensure they are saving a sufficient amount to reach their pension/retirement goals.   

Insurance requirements   

When living in Dubai, it’s important to have insurance in place to protect yourself from life’s uncertainties. deVere Group’s financial planning team will ensure that all your potential risks are mitigated as much as possible. This includes life and critical illness coverage. 

Loss of life in Dubai can lead to the loss of family visa sponsorship, loss of income, the requirement to repatriate or have remains repatriated. Serious illness can lead to loss of income, loss of employment, or a requirement for in-home care or childcare.   

deVere Group’s international financial advisors will help you to highlight the potential risks and protect yourself and your family from them.   

Tax structuring of investments   

Residents of Dubai enjoy tax-free growth on specific investments. However, one factor that is often overlooked is how these investments will be taxed once a resident leaves Dubai. The earlier a Dubai resident sits down with a personal financial advisor to arrange tax planning, the less likely they are to experience tax penalties in the future.   

Education planning necessity  

 One of the most critical pieces of wealth management in Dubai is education planning. This point is two-fold. Firstly, parents need to plan for private school fees in Dubai. Secondly, longer-term, children growing up in Dubai will often be classified as international students once they apply for university overseas.

For universities in the United Kingdom, this often means fees must be paid upfront and international student fees apply, which are generally three times higher than home student fees.   

Investor backed protection  

 One of the most crucial elements of wealth protection or wealth insurance is ensuring your capital is held in a secure jurisdiction. deVere Group advises clients on how to achieve wealth security through the use of off-shore banking and off-shore account ownership. The purpose of this is to achieve the possible highest levels of investor-backed protection.

Moreover, these accounts often offer long-term tax benefits known as gross-roll up or tax-free growth. Finally, off-shore accounts come with the highest level of investor confidentiality. 

Summary

Living in Dubai has numerous financial benefits. However, there is also a degree of increased responsibility as once people move to Dubai.; they often surrender a social welfare safety net.

Financial planning and wealth management in Dubai is not just for the ultra-rich. It is for everyone. Everyone needs money for the future, everyone is exposed to financial risks, and everyone can choose to take control of their financial destiny through solid financial planning.