If you’ve moved to Dubai or are planning to, one question probably keeps coming up:
“What happens to my UK pension now that I live abroad?”
Many UK expats in Dubai feel unsure about what happens to their retirement savings once they leave the UK. The idea of losing control or paying unnecessary tax can feel stressful.
Can you move all the pension here? Will you still get your benefits? How do taxes work?
If you’re asking the same questions, this guide will walk you through exactly how UK expats can manage their pensions from Dubai.
Let’s walk through everything you need to know, step by step.
Can You Transfer a UK Pension Directly to Dubai?
The short answer is; No!
And that’s the first thing to get clear.
You can’t move your UK pension straight into a UAE pension plan because the UAE government doesn’t recognize any local pension scheme that can accept UK funds.
Nonetheless, if you move your pension into a local or unapproved scheme, the UK authorities may charge you tax penalties of up to 40% of your fund value.
But that doesn’t mean you’re stuck! Many expats in Dubai use an International SIPP instead. With this fully UK-regulated option, you can access, manage, and even grow your pension from abroad.
How an International SIPP Works for Pension Transfer?
An International SIPP (Self-Invested Personal Pension) gives expats living abroad a UK-registered pension plan with full control over their savings. It works like a standard SIPP but offers more flexibility. With this plan, you follow UK pension rules and protection while managing your investments and currencies online.
When you move your existing UK pension into an International SIPP, your funds remain within the UK system. You can decide how to invest, whether in shares, funds, ETFs, or bonds. It’s like having a UK pension that travels with you wherever you go.
When you reach retirement age (currently 55, rising to 57 in 2028), you can withdraw up to 25% of your pension as a tax-free lump sum.
Why Expats in Dubai Prefer an International SIPP?
For many British expats in Dubai, managing a UK pension from abroad can be tricky. With an International SIPP, you have your pension secure under UK laws and get complete global access.
Here’s why it’s a popular choice among expats:
1. UK Regulation and Security
Your pension stays within the UK framework, regulated by the FCA and HMRC, which means it follows strict safety standards. This gives you peace of mind knowing your funds are protected under UK law.
2. Easy Global Access
An International SIPP can be managed completely online, giving you 24/7 access from anywhere in the world. You can view your pension’s performance, make adjustments, and communicate with your provider easily without needing to return to the UK.
3. Currency Flexibility
You can hold and invest your pension in multiple currencies such as GBP, USD, or AED. This helps reduce the risk of exchange rate changes and allows you to align your pension income with your lifestyle and expenses in Dubai.
4. Investment Freedom
An International SIPP gives you full control over your investment choices, unlike traditional pensions that limit where your money goes. In turn, you can choose from global funds, shares, and bonds, giving you the flexibility to match your retirement plan to your goals.
5. Simplified Pension Management
If you have several old UK pensions, you can combine them into a single International SIPP account. This makes it easier to track your progress, manage your portfolio, and plan for retirement without juggling multiple providers.
6. Tax Efficiency
With the UK–UAE Double Taxation Agreement, many expats can draw their pension more efficiently. Since Dubai currently has no personal income tax, your withdrawals may be more favorable compared to staying fully within the UK system.
7. Built for Expats
The International SIPP is designed for people living overseas. It keeps your pension safe, flexible, and easy to manage while you build your life in Dubai.
How to Transfer Your UK Pension to Dubai (Step-by-Step)
Here’s how the process usually works — simply explained:
Step 1: Review your current pension
Find out what type you have.
- Defined contribution pensions are straightforward to transfer.
- Defined benefit (final salary) pensions can also be moved, but it’s a big decision. You’ll need a regulated financial adviser and a transfer value analysis before doing so.
Step 2: Get professional advice
This is crucial. A regulated adviser familiar with UK and UAE rules can:
- Tell you if transferring is suitable for your situation
- Explain your potential tax treatment
- Compare costs between staying in your UK scheme vs. moving to an International SIPP
Step 3: Request a transfer value
Your current UK pension provider will issue a transfer value statement. This confirms how much you can move and lists any exit fees or restrictions.
Step 4: Complete the paperwork
You’ll fill out forms for both your current and new provider.
Expect to provide ID, proof of address, proof of residency in Dubai, and possibly source-of-funds documentation.
Step 5: Transfer and set up your new SIPP
Once approved, your pension funds move from your UK provider to your International SIPP.
This process can take anywhere from 4 to 12 weeks, depending on the providers involved.
Step 6: Choose your investments
Now comes the exciting part — you decide how your money is invested.
Options include funds, ETFs, bonds, or managed portfolios. If you prefer guidance, most providers offer access to professional investment management.
The Bottom Line
Transferring your UK pension to Dubai doesn’t mean moving it into the UAE.
It means restructuring it in a way that allows you to manage it safely, compliantly, and efficiently from Dubai.
An International SIPP is usually the most straightforward and compliant way to do that.
