As the largest and most populous city in the United Arab Emirates (UAE), Dubai is known for its luxury. Also the capital of the Emirate of Dubai, the city is a popular tourist destination as well as a lucrative location for businesses. But before you can experience the city’s positives, you still need to focus on handling payroll and other aspects of your expansion.
Globalization Partners makes it easy for companies to expand to Dubai through Dubai payroll outsourcing and our global expansion platform. We can add your employees to our compliant payroll, and we’ll manage the risk so that you can focus on managing your business.
Taxation Rules for Your Dubai Payroll
UAE’s federal government has not established any federal tax laws, so most emirates created their own tax decrees in the late 1960s. The UAE does not have withholding taxes, but the Dubai Income Tax Decree of 1969 does outline specific corporate income taxes. Keep in mind that rates change depending on industry. For example, companies in the upstream oil and gas industries are subject to taxes at rates negotiated in concession agreements.
Dubai Payroll Options
You can set up your Dubai payroll as one of four options:
- Internal: Larger subsidiaries with the budget for a big HR staff and a compliance expert may choose to run payroll out of the subsidiary. If you do the same, you’ll need to ensure that you’re staying compliant through every step of the process.
- Remote: Parent companies that already have their own payroll can add employees from different companies to the same payroll, but every employee from a different country will also have different labor laws that you need to follow.
- Outsourced with a local company: You can also choose to outsource your payroll with a Dubai payroll processing company. This company will handle paying employees, but you’ll need to make sure all their actions are compliant.
- Outsourced with a global PEO: Outsourcing with a global PEO such as Globalization Partners is the only way to outsource both payroll and compliance. Dubai payroll outsourcing with us will give you time to focus on growing your company.
Requirements for Establishing Your Payroll
Traditionally, companies planning to work in Dubai would need a subsidiary in the city to start operations. Unfortunately, it can take months or even up to a year to incorporate, impacting your timetable to hire employees and add them to your payroll. Globalization Partners will help you start working fast through Dubai payroll outsourcing. You can use our existing subsidiary to work in Dubai in a day or two, and you won’t have to worry about compliance.
Entitlement and Termination Terms to Set up a Dubai Payroll
Drafting strong entitlement and termination terms before setting up your Dubai payroll can help you create a clear agreement with employees. In the UAE, employees with at least one year of continuous service are entitled to severance. The amount of severance pay depends on how long the employee has worked for your company.
Contact Us Today
The team at Globalization Partners will help you expand faster. Contact us today for more information on Dubai payroll outsourcing.