Why You Have to Have an Offshore Bank Account if You Live in Dubai

Expatriates often wonder how best they should manage their money when they move abroad.  Questions about saving and investing may come later, but questions about which bank accounts are best are a pressing concern for most expats, particularly those who will be working overseas and who’ll need a local account for their salary to be paid into.

The very fact that most expats need a local account for day-to-day money management naturally leads the majority down the path of simply lumping all their cash in together in an account onshore in their new nation of residence.  Now whilst this can be a bad idea for most expats, it is a terrible idea for those living in Dubai.

In this article I’m going to explain why you have to have an offshore bank account if you live in Dubai – because if you don’t you are risking future financial stability for your entire family…

If you’re moving to live and work in Dubai there is a strong possibility that your employer will want to pay you into a local bank account.  Even if they don’t, you’ll possibly need a local account for your day-to-day living expenses, for the likes of school fees and even for paying for your utilities.  As stated, this can lead the lazy expat (!) down the route of opening a straightforward account and simply managing all monies through it.  This can have many disadvantages such as keeping all your money onshore in your new nation of residence and within sight of that nation’s government for example.  It can also mean you perhaps don’t benefit from the best banking terms and conditions on your account – but all of this is immaterial in the face of the real disadvantage you lay yourself open to if you simply have an onshore bank account in Dubai…

In Dubai, if you unfortunately die whilst living there, your bank accounts and any that are held in joint names with your spouse will be frozen.  And they are likely to be frozen for up to 18 months.  Now imagine what a devastating effect that would have on your family if your accounts were frozen and they had access to no money whatsoever.  If you’ve been sponsoring your family to live in Dubai with you they will have 30 days to get out of the emirate when you die as well because their visas will be rescinded. 

Accounts remain frozen whilst the entire probate period plays out, and this can be highly complex in Dubai.  What’s more, the process of reactivating accounts and releasing funds has to go through the courts which have to name the beneficiaries.  Even then funds are not released until all the deceased’s debts are honoured and these can include anything and everything from outstanding bills to unpaid parking fines.  Therefore, think about how your death would not only be totally devastating for your family on a purely emotional level, but if you keep all your wealth onshore with you in Dubai, it could also mean they are left effectively penniless and destitute if you don’t move money and keep it offshore and secure in an offshore bank account to which your spouse can gain access.

If you’re worried about your financial affairs and want to get them in the best order possible for you today and for your family’s future tomorrow, speak to an expat financial adviser.  They understand all the complexities associated with living overseas and trying to make sure your affairs are not only arranged to be beneficial in terms of wealth growth, but that they are also ordered correctly to comply with different nations’ rules.