What Is the New Pension System in Dubai?
by Vanshika S. SEO ExecutiveUAE citizens who work with governmental or private bodies are eligible
for retirement and pension benefits after they reach 49 and have served for at
least twenty years. The GCC nationals who find employment in the UAE are
pension entitled following numerous schemes related to their home countries.
Expatriate employees do not receive National pension scheme returns but
are entitled to some end-of-service benefits known as severance or gratuity
pay.
Federal retirement pensions
The federal law of UAE number 7, established in 1999, concerns the law
of social security and pensions. This law was applied as a federal law that
applies to nationals of UAE men and women working in private and governmental
organizations.
The NPS applications also cover the following groups of people
who are employed in the UAE:
- Emirati
who are self-employed
- Emirati
employers
- Citizens
of the GCC countries.
Age of retirement
According to the National pension scheme returns, the retirement
age of UAE citizens is generally 49, and for expatriate citizens, it can go up
to 60. Expatriates older than sixty years are allowed to work till 65 after
achieving approval from the Human Resource Minister and the Emiratisation.
After the age of sixty, labour face renewals annually.
Entitlement
The nationals of UAE working in private and government sectors are
readily available for National Pension Scheme benefits and social
security after they reach 49 by serving a minimum of 20 years. Emirates can
receive the benefit of pension according to the 1999 Federal law number 7. The
pension plan starts the day the termination of service does and ends when the
person dies, given he has no beneficiaries. Article number 16 provides law for
cases where nationals who are ensured are entitled to pensions.
Registration for the pension
benefit
An employer must register for the Emirate Employee pension scheme
regardless of their position in a private or governmental job. This process
should take place within no more than one month from the date they join. The
person will have to carry a family book, Emirates ID, and proof of employment
to enrol in a pension scheme from the federal government and pay the NPS
contribution online payment.
At the level of federal plans, the General Pensions and Social Security
Authority acts as a body of federal powers responsible for deciding adequate National
Pension Scheme benefits for all the nations of UAE working in entities.
These entities can include federal ministries and local governments such as
Sharjah, Dubai, Ajman Umm Al Quwain, Ras Al Khaimah, and Fujairah emirates.
Once the employee successfully registers with the GPSSA by filing an NPS application, the funds can be deposited in his account for the following reasons-
- If
the employer and employee contribute to the fund, it will be used as an
end-of-service benefit for the employee.
- The
insured employee contributes an amount that equates to five per cent of
his salary every month.
- Parallelly,
the employer will successfully contribute fifteen per cent of his entire
salary.
- If
the employer has a company they own privately, the employer will
contribute about twelve per cent of his salary, and the government will
contribute 2%.
For any other further queries, contact us here. We at Alankit Limited provide various e-governance, insurance, auditing, and other financial services for the convenience of Indian citizens in the United Arab Emirates.
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Created on Aug 23rd 2021 05:06. Viewed 467 times.