United Arab Emirates Expat Pensions

  • A] The Pension System

    I. Structure

    Very Different Nature

    For Expats who are going to live in the UAE, it is good to know that the UAE Pension System is very different from any pension system we know in the Western world. As this can affect your financial future, please make sure that you include all aspects into your analyses.

    UAE Nationals

    UAE nationals working in Government and Private Sectors are eligible for pensions and other retirement benefits at retirement age of 50 and after serving for 20 years minimum.

    Only employed UAE nationals who hold a ‘family book’ are entitled to be enrolled in the GPSSA pension scheme and are subsequently not entitled to receive an EoS gratuity when they leave an organisation.

    Those UAE nationals who are ineligible for registration are entitled to receive an EoS Gratuity Payment or be registered with a Qualifying Company Pension Scheme in accordance with UAE labour law.

    GCC Nationals*

    GCC nationals employed in the UAE are entitled for pension in accordance with the schemes established in their home countries.

    They qualify for registration by default based on their nationality and need not submit any proof other than their passport.

    * GCC nationals are persons from governments of the Gulf Cooperation Council (GCC) member states: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. Which States have State Pension Schemes for their employed citizens.

    UAE & GCC Nationals Registration

    Registration is a mandatory requirement for both GCC and eligible UAE nationals.

    Emiratis aged between 18 and 60 are eligible for the scheme subject to providing a medical and fitness report endorsed by a certified GPSSA centre.


    Expat workers are not entitled to pension but are entitled to end-of-service benefits also known as gratuity or severance pay.

    II. Retirement Age

    The retirement age for Emiratis is age 50. For expat residents it is age 60.

    Expats who are older than 60 are allowed to work up to the age of 65 after obtaining approval of the Minister of Human Resources and Emiratisation. As of age 60, labour cards are renewed annually.

    III. Entitlements

    Emiratis receive pension in accordance with Federal Law No. 7 of 1999 Concerning the Issuance of the Law on Pensions and Social Security.

    The entitlement of the insured to the pension commences on the day that follows the termination of his service and ceases upon his death provided he has no beneficiaries.

    If he has beneficiaries, the entitlement to the pension shall be transferred in accordance with the provisions of the Law. The entitlement of the beneficiaries of the insured or the pensioner commences as of the month that follows the date of death. (Article 16 of the Law provides for the cases in which insured nationals are entitled for pensions.)

    IV. Registration/Premiums/Claims


    A governmental/private employer has to register the Emirati employees for the pension scheme within one month as of their first day at work.

    Emirates ID, family book and proof of employment are some of the conditions required for registration in the federal pension scheme.

    At the federal level, General Pensions and Social Security Authority (GPSSA) is the federal body responsible for administering the pensions for all of the UAE national working force in the federal ministries and entities and local governments in Dubai, Sharjah, Ras Al Khaimah, Ajman Umm Al Quwain and Fujairah Emirates.

    Before registering eligible employees, an employer must first register itself with the GPSSA and obtain a registration number. Which process usually takes five working days following the submission of the required documentation.

    This detail is relevant as eligible employees have to be registered within one month as of the date of commencement of their employment. Which process can also take up to 14 working days.

    Late registration may be penalised. Thus advisable for an employer to begin their organisational registration process with the GPSSA sooner rather than later.

    Individual employees have a single registration number which remains with them for their entire working life in the UAE.


    Once an employee is registered with GPSSA, funds are deposited in his account as follows:

    • Both employee and employer share in contributing to the pension fund which is eventually used as end of service benefit for the employee.
    • The insured employee contributes an amount equal to 5% of his monthly wages.
    • His employer (if a government entity) would contribute 15% of his wages.
    • If his employer is a privately owned company, the employer would contribute 12.5% of his salary and the government would contribute 2.5%.
    • The old age pension is a lifelong monthly payment and becomes payable the next day of service termination.

    If you would like to calculate your exact claim, please use the following link:


    V. Citizens Ineligible For Pension Scheme

    UAE nationals who are ineligible for pension scheme will receive end of service benefits in accordance with the provisions of Articles 38 to 42 of the Federal Law No.7 of 1999 on Pensions and Social Security.

    Accordingly, the benefit will amount to a salary of one and a half months for every year of the first five years and it will increase to a salary of two months for every year of the following five years and to a salary of three months for any additional year thereafter.

    Should the insured pass away, his entitlement for the period of service has to be paid to the beneficiaries in accordance with the provisions of the Pensions law above. In the absence of beneficiaries, such benefit would be distributed as per the provisions of the Islamic Shari'a with regard to inheritance.

    VI. Abu Dhabi Pensions

    In Abu Dhabi, Abu Dhabi Retirement Pensions and Benefits Fund manages pensions on behalf of Abu Dhabi-based and employed UAE nationals. However, it does not manage pensions for GCC nationals and this responsibility lies with GPSSA.

    In addition, the emirate of Abu Dhabi has a separate pension law; Law No. 2 of 2000 regarding Civil Retirement Pensions and Benefits in the Emirate of Abu Dhabi.

    VII. Retirement Rules Of Dubai Government

    Decree No. 21 of 2017 approves the retirement and pension procedures applicable to Dubai government employees. It aims to ensure equal opportunities for Dubai government employees and further protect the rights of pensioners.

    Dubai government human resources department (DGHR) will form a committee to evaluate the retirement requests of employees. A representative of DGHR will chair the committee. The committee is composed of representatives from Dubai's Department of Finance, the General Secretariat of Dubai Executive Council and the General Secretariat of Dubai's Supreme Legislation Committee.

    The decree also defines retirement procedures. Pursuant to the decree, Dubai government entities must refer their employees' retirement requests to DGHR. The application must clarify the reasons for retirement and provide all the required information and documents and meet any other requirements set by the committee.

    The government entity is responsible for completing the application, satisfying the requirements and completing the documents prior to submission to the committee.

    DGHR is responsible for following up the committee's recommendations, including referring its recommendations to the General Secretariat of Dubai's Supreme Legislation Committee to issue the required legislation prior to submission to His Highness the Ruler for final approval.

    VIII. Pension For GCC Nationals

    GCC nationals employed in the UAE are entitled for pension in accordance with the schemes established in their home countries. GCC citizens who are working in any GCC member country outside their home country are entitled to pension.

    IX. GCC Nationals' Monthly Subscriptions

    The employers in the UAE are liable to mandatory subscriptions for their GCC employees according to the social security law in their home countries in terms of registration and subscriptions. Provided that the same may not exceed the subscription share designated for the employers to UAE nationals.

    X. FAQ

    For additional information and answers to popular questions regarding for example Disability Pensions and Next of Kin Pensions, please visit the following link:


  • B) Buying Voluntary Extra Pension Claims

    I. Structure

    The pension system includes the option to buy ‘Nominal Service Periods’ by the already insured person. Which are periods that did not yet have a pension coverage but which coverage can be bought within certain conditions.

    These ‘Services Periods’ which may be bought amount to 5 years for a Male and 10 years for a Female.

    We will now mention several of the most relevant related conditions to buying extra claims:

    • The insured person has to apply before the end of service;
    • Service year upon purchase shall be 20 years;
    • The premium can be paid as a Lump Sum or in installments and will be withheld from the wages payments.

    II. No Tax Benefits

    As the UAE does not have Income Tax, there is no tax advantage for buying extra pension claims.

    As normally such a (substantial) tax benefit is a very important factor for buying extra pension claims, it seems advisable to carefully compare this option with other investment options regarding costs, coverages, expected return on investments and pay-out flexibility.

    Finally please be aware that if you might relocate to another country and retire over there, that this country might tax pensions. Which issue you in general would not have with investing in a private pension fund while living in the UAE.

  • C] Pensions & Tax

    The UAE does not tax personal income like pensions.

    If you might retire in the UAE and would receive pension payments from abroad, please pay attention to possibly existing tax exposure at source.

  • D] UK Pension Claims And QROPS

    Expats are often approached by providers/salesmen who advise them to go for the QROPS route and to thus transfer their UK occupational pension claims outside of the UK.

    As there is no QROPS UAE plan, such a transfer would not be UK tax neutral and thus in general not that recommendable.

  • E] News February 2021

    United Arab Emirates

    The United Arab Emirates has historically operated an end of service gratuity (EoSG) model whereby all employees are entitled to receive a payment at the termination of their employment calculated by reference to their period of service. Historically, employers have accrued this liability on their balance sheet but have not proactively funded such arrangements. This left employees exposed to the solvency risk of their employers.

    The Dubai International Financial Centre (DIFC) launched an alternative to the EoSG model in April 2020 whereby employers were required to pay into a money purchase scheme. Contributions are based on a proportion of an employee's salary (either 5.83% or 8.33% of basic salary depending on period of service) and the employee is entitled to select from a range of model investment portfolios based on their risk appetite. DIFC employers had the option to contribute to the DIFC Employee Workplace Savings Scheme which is administered by Zurich or to register an alternative qualifying scheme.

    It is expected that the DIFC model will be rolled out to the wider UAE thereby bring an end to the EoSG model. This will create opportunities for life insurers and pension funds to offer qualifying schemes to employers in UAE.

    Retire In Dubai Launches To Expatriates

    The government of Dubai has announced the launch of Retire in Dubai, a global programme that offers resident expatriates and foreigners aged 55 and above the opportunity to enjoy the distinctive lifestyle of the emirate.

    The first such scheme in the region, Retire in Dubai is spearheaded by the Department of Tourism and Commerce Marketing (Dubai Tourism) in collaboration with the general directorate of residency and foreigners’ affairs.

    To ensure a competitive offering, Dubai Tourism has worked with its partners to develop key propositions for retirees covering healthcare, real estate, insurance and banking.

    Details of the offerings, designed to help retirees enjoy a happy and fulfilling life, and all information necessary to start the application process, are available here.

    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; having savings of AED1 million; or owning a property in Dubai worth AED2 million.

    In its initial phase, the programme will focus on UAE residents working in Dubai who have reached retirement age. The programme offers long-term residents of the city who are familiar with Dubai’s value proposition an easy and hassle-free retirement option.

    Dubai’s close proximity with the native countries of a large majority of residents makes it a convenient retirement destination for them.

    Wages In Dubai

    HSBC Bank’s Expat explorer survey reckons the average expat salary is $138,000 a year, with three out of four expats confirming they earn more in Dubai than if they did the same job back home. Packages for employees likely come with allowances for housing, schooling children, healthcare, and a car.