financial institutions to ensure guidelines are followed. The following are the specific considerations and regulations that apply to expatriates: Key Considerations for Expatriates 1. Visa and Work Permits: The employers are responsible for obtaining valid work permits and visas for their hired foreign workers. There are 10 types of work permits that are issued to expatriates based on the need of the employment. For issuing the initial work permit, employers are required to bear the cost and submit various documents, including a valid passport, academic qualifications etc. The UAE allows expatriates two-month-long work permits until their employer finalises the residence permit. Additionally, Expats can’t get a new work permit if they end their contract early, don’t give proper notice, fail to meet termination requirements, or are terminated for poor performance. As per Article 60 of Federal Decree-Law No. 33 of 2021, using work permits for purposes other than those issued will result in a fine between AED 50,000 and AED 200,000. 2. Social Security Contributions and Benefits: Unlike Emiratis who must contribute
to the General Pension and Social Security Authority (GPSSA), expatriates do not have this obligation. Instead, they may be covered by private health insurance, housing allowances etc. provided by their employers. For free zones like Dubai International Financial Centre (DIFC), expatriate employees will contribute to DIFC Employee Workplace Savings (DEWS) scheme, with employers making monthly contributions on basic salary as per DIFC Law No. 4 of 2020. If the expat belongs to GCC nationality, then they will be covered under GCC Insurance Protection Extension Program. Both the employee and employer must share the contributions according to the rates in the employee’s home state. If the employer’s share exceeds the percentage stipulated in UAE, the excess amount gets deducted from the employee’s wage. 3. Taxation: One of the UAE’s attractive features for expats is the absence of personal income tax. However, expats should be aware of their home country’s tax obligations.
4. Gratuity: Foreign workers who have completed a year or more in
continuous service are entitled to end-of-service benefits proportional
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ISSUE 8 GLOBAL PAYROLL MAGAZINE
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