If you’re an expat in the UAE planning for retirement, understanding your pension options is crucial. Unlike Emirati nationals, expatriates are not eligible for mandatory government pension schemes such as those administered by the General Pension and Social Security Authority. Instead, most expats rely on End-of-Service Gratuity (EOSG) and employer-sponsored or voluntary pension plans to build long-term financial security.
In this 2026 guide, we outline the pension schemes available to expats in the UAE, explain their key benefits, and help you determine the right approach with informed, professional guidance.
The End of Service Gratuity (EOSG) is the primary retirement-related benefit available to expats working in the UAE. It is a statutory lump-sum payment calculated based on an employee’s basic salary and length of continuous service.
The gratuity is calculated as follows:
However, the total gratuity amount cannot exceed the equivalent of two years’ basic salary.
To qualify, there must be a valid employment contract between the employer and employee. And the employee must complete at least one year of continuous service. Gratuity may be forfeited if termination occurs due to gross misconduct under Article 44 of the UAE Labour Law.
While EOSG provides a financial cushion at the end of employment, it is not designed to function as a full pension scheme. Since it is paid as a one-time lump sum, long-term retirement sustainability depends on additional savings or structured pension solutions. To strengthen retirement planning beyond EOSG, expats can consider the following pension schemes:
This is a voluntary savings pension scheme for expats in the UAE private sector. It is designed and targeted as a convenient alternative to the traditional End-of-Service Gratuity (EOSG) system, depending on whether the employer chooses to participate.
Under this structure, the employer contributes monthly amounts equivalent to the employee’s gratuity entitlement into a regulated investment fund. This approach enhances transparency and removes the gratuity liability from the employer’s balance sheet. They are then invested in diversified portfolios, which may include bank deposits, sukuks (Sharia-compliant financial products), and other regulated financial assets, depending on the selected investment option.
While employees can review and track their gains, they cannot redeem the profits without the employer’s approval. However, they may be allowed to make additional voluntary contributions and, subject to plan rules, withdraw their personal contributions.
Private sector employers in the UAE may apply to the Ministry of Human Resources and Emiratisation (MoHRE) to enroll in a voluntary pension scheme for their employees. These schemes are managed by licensed fund managers, regulated by MoHRE, and supervised by the Capital Market Authority – formerly the Securities and Commodities Authority (SCA) – ensuring regulatory oversight and compliance.
Unlike traditional gratuity arrangements, voluntary pension schemes are structured investment-based plans designed to provide long-term retirement savings.
Employees may choose to contribute a percentage of their salary to the pension scheme. Additional voluntary contributions are permitted, subject to regulatory caps and scheme limits, provided they do not exceed 25% of the employee’s total annual earnings.
If an employee changes jobs, they typically have two options:
Depending on the specific company policy and fund structure, full or partial withdrawals may be allowed under defined conditions.
The DIFC Employee Workplace Savings Plan (DEWS) is a regulated workplace pension scheme introduced within the Dubai International Financial Centre (DIFC). It was established to replace the traditional End-of-Service Gratuity system for eligible DIFC-based employees.
Participation in DEWS is mandatory for eligible employees within the DIFC jurisdiction, while additional voluntary contributions remain optional.
Employers are required to contribute monthly to the plan based on total years of DIFC service:
These contributions replace the traditional gratuity accrual model.
Employees can select an appropriate investment fund based on their risk appetite and long-term financial objectives. The annual management fee typically ranges between 1.26% and 1.33%, depending on the chosen investment fund. This fee is embedded within the fund’s pricing structure rather than deducted separately from accumulated savings.
For UK expats residing in the UAE, international pension arrangements may allow the transfer of an existing UK pension while offering flexibility in currency, investment access, and long-term retirement planning. These arrangements must comply with UK tax regulations and reporting requirements.
The three primary international pension options typically considered are:
QROPS are overseas pension schemes approved by His Majesty’s Revenue and Customs (HMRC). They are designed to receive transfers from UK-registered pension plans.
At present, there are no HMRC-authorised QROPS providers based in the UAE. As a result, transferring a UK pension tochoosing_the_right_pension_scheme a QROPS in another jurisdiction may trigger a 25% Overseas Transfer Charge (OTC), unless an exemption applies. An exemption may be available if the QROPS is located in the same country in which the individual is tax resident.
A careful review of residency status and tax exposure is essential before proceeding with a pension transfer to QROPS.
A pension scheme structured specifically for UK expatriates who wish to retain access to a UK-based pension framework while living abroad.
Key features may include:
However, suitability depends on individual tax residency, UK annual contribution limits, and the long-term retirement objectives.
A retirement and exclusive pension program designed for globally mobile professionals who may relocate multiple times throughout their careers.
These plans typically offer:
While IPPPs can provide structural flexibility, transferring a UK pension into such a plan may carry significant tax implications. Professional tax advice is strongly recommended prior to any transfer decision.
The UK-UAE Double Taxation Agreement (DTA), introduced in 2016, aims to prevent individuals from being taxed twice on the same income. Under this agreement, taxing rights are allocated between the two countries based on residency status and the type of income received.
For UK pension income, tax treatment depends largely on whether you qualify as a UAE tax resident.
To benefit from the UK-UAE DTA provisions, UK expats must obtain a Tax Residency Certificate (TRC) from the UAE Ministry of Finance. This certificate confirms UAE tax residency for UK tax purposes.
You may qualify if one of the following conditions is met:
Residency assessments may depend on individual circumstances, so careful documentation and correct timing are important.
Once recognised as a UAE tax resident, the UK generally relinquishes taxing rights over most private pension income.
As the UAE does not levy personal income tax, UK private pension withdrawals, whether taken as lump sums or regular income, are typically not taxed in the UAE.
However, eligibility depends on proper residency status and compliance with UK reporting obligations.
Because pension taxation is complex, individual circumstances should be reviewed carefully before making withdrawal or transfer decisions.
Determining the most suitable UAE pension scheme for expats involves evaluating your long-term objectives, risk tolerance, residency status, and potential tax implications. With multiple arrangements available, each carries distinct benefits and regulatory considerations that should align with your broader financial strategy.
By working with our financial advisors, you can assess your existing plans, explore appropriate pension options, and develop a retirement strategy built on clarity, compliance, and long-term confidence.
Pension amounts in the UAE depend on the type of plan. For statutory EOSG, it is based on basic salary and length of service. For example, a 20-year employee may calculate gratuity as: 21 days’ salary per year for the first 5 years, plus 30 days per year thereafter, capped at two years’ salary.
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Temporary, part-time, or contract employees may or may not be eligible for gratuity unless their employment contract specifies it. Employees who resign or are terminated are entitled to gratuity, unless termination is due to gross misconduct under Article 44 of the UAE Labour Law. Employees who resign after completing at least 1 year of continuous service are entitled to pro-rated end-of-service gratuity.
To be eligible to retire in the UAE, a person must have worked for at least 15 years, either within or outside the UAE, or be aged 55 or older at the time of retirement. They should also own a property/properties worth no less than Dh1 million, have savings of no less than Dh1 million, or have a monthly income of Dh20,000
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