If you’ve ever wondered whether you’d earn more living and working in Dubai compared to India, you’re not alone. With rising entrepreneurial interest and job migration trends between the two regions, the debate around what you earn in India vs UAE and how much of it is taxed is heating up in 2025.
In this guide, we break down the tax on salary in India vs UAE, compare business taxes, and show you where you actually keep more of your hard-earned money! Whether you’re an employee, entrepreneur, or investor.
What You Earn in India vs UAE: A Practical Comparison
When comparing income potential, it’s not just about how much you earn & it’s about how much you keep after taxes, lifestyle costs, and business expenses.
In India:
- Salaries vary widely depending on the city, role, and industry.
- Mid-level professionals earn around ₹8–20 lakhs per annum in metros like Mumbai or Bengaluru.
- Income is subject to personal income tax starting at 5%, going up to 30% for high earners.
In the UAE:
- Professionals in similar roles earn 20% to 40% more, depending on the industry.
- There is no personal income tax on salary or freelance earnings.
- Expats often receive benefits like housing allowance, medical insurance, and education support.
📌 Takeaway: Even if the salary is the same, UAE professionals keep more of their income due to tax-free earnings.
Tax on Salary in India vs UAE
India:
- Salaries are taxed progressively under the Income Tax Act.
- New tax regime (as of 2024–25):
- Up to ₹3 lakh: Nil
- ₹3–6 lakh: 5%
- ₹6–9 lakh: 10%
- ₹9–12 lakh: 15%
- ₹12–15 lakh: 20%
- Above ₹15 lakh: 30%
Add to that cess, surcharges, and mandatory deductions like PF and professional tax, and the actual take-home significantly reduces.
UAE:
- Zero tax on individual salaries or wages, regardless of how high your income is.
- No PF, no cess, no professional tax.
- Social security contributions apply only to UAE/GCC nationals, not to Indian expats.
📌 Takeaway: If you’re earning ₹25+ lakh in India, you’re likely losing up to ₹7–10 lakh in taxes. In the UAE, that’s tax-free income in your bank account.
Tax on Business in India vs UAE
Let’s say you’re not an employee & you’re running your own business. How do the two countries stack up?
In India:
- Corporate tax is 22% for domestic companies, and 15% for new manufacturing units.
- GST (Goods & Services Tax) adds another 5–28% on products and services.
- Compliance is complex and time-consuming (GST filings, TDS, audits, etc.).
- State-level taxes, surcharges, and cess apply depending on location and business type.
In the UAE:
- Corporate Tax (as of June 2023) is 9% on net profits above AED 375,000 (~₹84 lakh).
- Below that threshold? You pay 0% corporate tax.
- No VAT for businesses below the VAT registration threshold (AED 375,000 revenue).
- No capital gains tax, no dividend tax, and simpler annual filing requirements.
📌 Takeaway: If you’re running a lean startup or small business, the UAE gives you higher post-tax profits with fewer compliance burdens.
Hidden Perks of Earning in the UAE
Beyond salary and tax, here are a few underrated benefits of living and earning in the UAE:
- Stronger currency (AED): Earnings in AED convert into higher INR value when remitted.
- 100% foreign business ownership in free zones and the mainland.
- Residency by business setup: Start a business and get a long-term visa.
- Zero tax on capital gains or savings interest that means you keep what you earn and grow.
Lifestyle Costs: Should You Factor Them?
Yes, Dubai’s cost of living is higher than Tier 2 Indian cities — but compared to Mumbai or Delhi, it’s more expensive than you think.
Plus, you’re saving significantly on taxes. For example, an Indian professional earning ₹40 lakh per annum may only see ₹30–32 lakh after taxes in India. In the UAE, a similar role could pay AED 250,000–300,000 tax-free & which converts to ₹55–65 lakh in hand annually.
That’s a 30% to 50% jump in real income, even after accounting for rent or school fees.
Why Are Indians Moving to the UAE in 2025?
According to recent migration trends, India remains one of the largest sources of entrepreneurs and skilled professionals to the UAE, and the reasons are obvious:
- Higher take-home salary
- Favorable business tax structure
- Residency through business ownership
- Ease of global banking, investment, and trade
Whether you’re a freelancer, consultant, small business owner, or startup founder, the UAE offers a fast-track to financial freedom and global reach.
Final Word: Where Should You Build Your Future?
If you’re tired of high tax slabs, complex compliance, and shrinking net income in India, Dubai presents a clear alternative.
The difference between what you earn in India vs UAE is not just in the numbers but also it’s in the structure, stability, and long-term value of your income.
AB Capital Services: Helping You Make the Move Smartly
At AB Capital Services, we help professionals and business owners from India set up legally in the UAE with:
- Low-cost company formation packages starting from AED 12,500
- Lifetime UAE residency visa with your business license
- Bank account setup in 3 business days
- Support with tax planning, compliance, and expansion
If you’re ready to keep more of what you earn and build in a tax-efficient jurisdiction, we’ll help you every step of the way.
📞 Book a free consultation today and let’s get your UAE business or visa journey started.
Read more about AED 12,500 Package: https://staging.abcapital.ae/start-a-business-in-rakez-free-zone-in-just-aed-12500/