How is income tax calculated in United Arab Emirates?
The UAE has no personal income tax, federal or emirate-level. Take-home pay equals gross pay for expatriates; UAE nationals contribute to the state pension.
What is the income tax rate in United Arab Emirates?
No personal income tax. UAE nationals pay a 5% pension contribution; expatriates pay nothing.
What mandatory salary deductions apply?
- UAE nationals: 5% pension contribution (the employer pays 12.5%, or 15% in Abu Dhabi). Expatriates: none.
Gross salary and take-home salary
Gross salary is what your contract says before anything is taken off. Take-home salary is what reaches your bank account after income tax and the compulsory employee contributions. Employer contributions are paid on top of your salary and are not taken from it.
Example: AED 25,000.00 a month
An expatriate in Dubai earning AED 25,000 a month.
| Item | Monthly | Annual |
|---|---|---|
| Gross salary | AED 25,000.00 | AED 300,000.00 |
| Income tax | AED 0.00 | AED 0.00 |
| Compulsory contributions | AED 0.00 | AED 0.00 |
| Take-home pay | AED 25,000.00 | AED 300,000.00 |
Effective income tax rate 0.0%; all deductions 0.0%.
How can employees legally reduce their taxes?
- There is no income tax to reduce. What changes take-home pay is the employee’s social insurance, which is set by law and cannot be opted out of where it applies.
Frequently asked questions
Is there income tax on salaries in the United Arab Emirates?
No. the United Arab Emirates does not tax employment income.
Do expatriates pay social security in the UAE?
No. Pension contributions apply to UAE and GCC nationals; UAE nationals pay 5% of salary.
Official sources
- PwC Worldwide Tax Summaries (reviewed 9 September 2026): Taxes on personal income and social security contributions. Read 5 November 2026.
Last reviewed 5 November 2026. An estimate for planning, not tax advice; your employer’s payroll and the tax authority decide what is actually withheld.
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