Taxation and the intensity and expansive nature of the same in India have been discussed with fervour over the past few months and a year at large.
In Nirmala Sitharaman’s first budget after the election, in July 2024, the country’s middle class felt underappreciated and deeply affected by the taxation system. The budget was even dubbed unfriendly for the middle class.
Go To Dubai To Save Taxes?
Nearly 7 months after that, another budget came along; however, this time, with consumption as the major focus, the government and the FM shook up the personal tax system, pushing the upper limit for minimum income to Rs 12 lakh per annum, apart from introducing a new Income Tax Bill.
Amid all this, many may still dissatisfied with the taxation regime in the country, especially the upper middle-to-upper class.
One such concern appeared in the form of question on social media platform Reddit.
An anonymous user, asking for advice, shared a post with a title, “Does it make sense to move to Dubai for Tax saving purposes for 28M earning 1 Cr”
The user further elaborated and said, “Hi, I am working as a Software Consultant remotely for US clients, no TDS deducted and I file my own taxes. Next FY my income will cross 1Cr, so I won’t be eligible for 44ADA and my tax would increase significantly. So need some advice regarding moving to Dubai. Does it make sense to move there (Not married) ?”
Responses Pour In
This query got over 100 responses.
Some responded, and supported the decision of moving to the UAE to save taxes. One user said, “es, moving to Dubai makes sense from a tax-saving perspective since the UAE has zero personal income tax. On ₹1 Cr income, you’d save ~₹30L+ in taxes. However, consider the high cost of living, visa requirements, and lifestyle changes. If you’re comfortable with these, it could be a good move.
You’ll need a freelance permit or business license, which costs AED (₹1.7L–4.5L) per year. A 9% corporate tax applies to businesses earning over AED 375,000 (~₹85L) annually. However, this usually doesn’t affect freelancers unless they set up a formal company.”
Another user said, “If you plan to only work for international clients, the Remote Work Visa is a cheaper option. If you wantsto expand and work with UAE clients, the Freelance Visa is better.”
One user said, “Yeah, you prob will save 35 lakhs around in taxes, you can use those saved taxes to live in dubai or travel or invest.”
Don’t Go, Says One Redditor
Another user had a contrarian opinion and said, “lmao i just laugh at anyone saying dubai has better kwality of living dubai expenses are not double of india but more than that.”
“As for the Dubai is Better try visiting the same place during the 6 months of heat where u will be sweating even at 9 or 10 at night. The Weather Absolutely Sucks As for the Better kwality of living – it might be somewhat better – That too in selected areas like downtown or Business Bay.”
“Dubai Is Expensive if you actually Reside there – that is the truth which u will discover when u stay there for more than 3-4 months. Average fine that people actually pay there is 220 Usd for speeding (In this Scenario Speeding was 32 KMPH). If u actually want to change country, i would Suggest u try it out yourself for the span of 4-5 months.”
