When applying for a role in a tax-free country like Qatar (or any of the Gulf countries), my experience is that many people find it challenging to compare their taxable pay-rate at home with that they are likely to receive overseas. To try to assist with this I have compiled the following information.
By way of background; candidates for roles in Qatar should realise that, although the country is still rapidly developing, it already offers most of the facilities, conveniences and lifestyles that one might expect in any first-world nation. There is no shortage of skilled professionals wanting to come to Qatar and hence the massive premiums once paid to attract people to “hardship postings” are no longer available.
In addition to this, my experience is that companies in Qatar like to work toward building long-term skilled resource teams inside the country by attracting and retaining people for lengthy terms. Hence it is very rare to find the short-term or “day rate” contracts that are often available for 3 to 6 month assignments in the UK. To this end salaries tend not to factor in the risks or overheads associated with such roles and tend to me more competitive when benchmarked against full-time salaries elsewhere.
In my, admittedly limited, experience salaries for skilled personnel are packaged differently in every country. Hence when making a comparison between what you might have been offered in Qatar and what you are earning elsewhere you must take into account some of the following:
- Taxes – in the UK these will be in the region of 25% to 30% hence you must take 25% to 30% of your salary to be able to compare to a salary in Qatar. In Qatar you will not pay any tax. What you are paid is what you take home.
- Annual Leave Holidays – In the UK employees might be paid for anywhere from 20 to 45 annual-leave days per year. In Qatar you are often not paid for holidays so you will need to compensate for this.
- Public Holidays – In the UK there are about 7 or 8 paid public holidays per year. Qatar has a similar number.
- Sick leave – In the UK employers usually pay for sick leave. In Qatar this is entirely at the discretion of the employer
- Working hours – In the UK there are strict rules on working hours and how many an employer can make you work. In Qatar you need to ensure that your working hours are specified in your contract.
- Health insurance – UK citizens are covered by their National Health Service for healthcare. In Qatar you need to ensure that your employer covers you and your family for heal;th insurance, or else pay for it, or your care, yourself.
- Accommodation – Accommodation in Qatar tends to be of a higher standard with more facilities than most people might expect in the UK. However this comes at a cost, typically sgood accommodation here is no more expensive than London, but defintely more expensive than other parts of the UK, hence you need to ensure that you understand accommodation costs and have adequately budgeted for these.
- Travel – most people working overseas will want to travel home at least annually to visit family. Make sure you have allowed for this in your negotiations with your employer.
I have compiled the following table, taking into account known overheads and costs to enable prospective UK employees to compare the salary they may be offered in Qatar:
|NHS Band (top of scale)||Annual Pretax Salary||Annual “take-home” salary||Daily rate||Value of 30 days annual leave||Value of 14 paid sick days||Rate if only paid for days worked||Equivalent day rate in Qatari Riyal|
I have prepared similar tables for the US and Australia based on the differning tax rates, sickness and annual leave in those countries (below):
|US Annual Pretax Salary||US Annual “take-home” salary||US Daily rate||Value of 15 days annual leave||Value of 7 paid sick days||Rate if only paid for days worked||Equivalent day rate in Qatari Riyal|
|Australia Annual Pretax Salary||Australia Annual “take-home” salary||Australia Daily rate||Value of 20 days annual leave||Value of 10 paid sick days||Rate if only paid for days worked||Equivalent day rate in Qatari Riyal|
If you are a day-rate contractor in the UK and wish to get a fair comparison of rates. The following table might help, I have not been able to do the calculations for Australia and US:
|Contractor day-rate||Estimated day-rate after taxes (30%)||Estimated day rate after risk and overhead are removed (20%)||Daily rate in Qatari Riyal (Using GBP1:5.81)|
Some other costs that might help you in your calculations:
|Cost||Per Month (QAR)||Daily cost (based on 252 days per year)|
|Typical “Western-style” 2 bedroom flat||8,000||382|
|Typical “Western-style” 3 bedroom house||13,000||622|
|Health Insurance per person||417||20|
|Annual travel cost per person to UK (return)||496||24|
…and finally… any decision you make must take into account what is right for you and what you ware looking for in terms of lifestyle, risk and personal satisfaction. Something you might like to think about:
1) If you are a day-rate contractor your appetite for risk and possible additional reward Vs your confidence of a steady income stream for the next few years
2) The value you place on experiencing a different lifestyle in a different culture
3) The value placed on a relatively relaxed lifestyle in Qatar Vs a busy and potentially stressful one in the UK
4) Appetite for travel and holidays. We tend to have a lot of public holidays (two Eid’s, National Day and National Sports Day) – up to 12 days and the two Eid’s were a week long each last year so meant two 9 day breaks – not always the case – and people travel in this time as well as taking time out during the year to get away.