MONEY MATTERS

PAYMENT OF SALARY

Salary is paid in the local currency (UAE Dirhams). All faculty are paid monthly and receive their salary by the end of the month. On joining you will be asked to open a local bank account with the Sharjah Islamic Bank or the HSBC and you must provide the account number to the Human Resource Services Department so that your salary can be deposited into your bank account. The bank provides facilities for telegraphic transfer of monies into overseas accounts. This can be arranged by signing a standing instruction form with the bank. Standing instructions can be set up for more than one overseas transfer. However, AUS will only pay for the cost out of the UAE of one overseas transfer per month.

To maintain a dollar account there are certain additional charges and it is advisable to check these out with the bank before opting for a dollar account. Money can be transferred from a dirham account to an overseas account, at the time of salary transfer to your account, with no loss on the exchange factor as the university maintains a fixed exchange rate with the Sharjah Islamic Bank and the HSBC.

As a new faculty member at AUS, you will receive your first salary at the end of September, if you join for Fall semester or February is you join for Spring semester. However, it is possible to obtain an advance on salary by completing an “Advance Salary” form available from Human Resource Services Department. 

AUS SELF DIRECTED EMPLOYEE BENEFITS PLAN

At its meeting on February 15, 2004 the Board of Trustees adopted a Self Directed Employee Benefits Plan for faculty and eligible staff hired by the university on or after that date.

The plan revises the “take-it or leave-it” limitation contained in previous benefit offerings. The new approach empowers eligible employees to design their own benefits package and to apply their allowance in whole or in part to any benefit in the plan. To the extent that available Self Directed Employee Benefits in the package are not utilized by an employee to pay for mandatory (health insurance and life & disability insurance) and optional benefits provided by the plan, employees are eligible for cash withdrawal at the end of the academic year, up to a maximum of benefits and cash equal to twenty five percent of annual base salary, subject to applicable tax withholdings, payable with the October salary.  

The gross amount of the of Self Directed Employee Benefits allowance is calculated and set once per year, in September at the beginning of the academic school year. This amount will not change throughout the 12 month period.  Any salary adjustments or merits that occur throughout the year, will not be reflected in the allowance until the following September.

Further details click here for Self Directed Flexible Benefits Plan

BANKING FACILITIES

All AUS faculty members must maintain an account with the Sharjah Islamic Bank which has a branch located on campus or with the HSBC bank. There are no restrictions on the import and export of foreign and local currencies. Traveler's checks, drafts, and telegraphic transfers are available. The UAE has a modern banking service and one can expect to receive the same conveniences that are available in their home country, including personal automobile loans. ATM machines that take cash cards, Visa, Mastercard, and American Express cards are in abundance.

Some of the more familiar international banks in the area are Abn-Amro Bank, Arab Bank Plc., Barclays Bank PLC, Citibank, Lloyds Bank PLC, Royal Bank of Canada and Standard Chartered Bank. http://www.dwtc.com/directory/banks.htm and you may decide to transfer your salary from Sharjah Islamic Bank to any international bank

CURRENCY

The unit of currency is the UAE Dirham. One dirham equals 100 fils. There are 3.68 dirhams to one US dollar or approximately 6.50 dirhams to one English Pound. A dirham will buy a small bottle of water, a cup of tea, a passport photo, one or two post cards or a can of soda. At Burger King on campus, a burger costs approximately 3 dirhams.

AMERICAN INCOME TAX

As employees of a US employer, faculty and staff who are US citizens or US resident aliens (green card holders) will be subject to the exclusion from their monthly salary of FICA (US social security tax), Medicare & Federal Witholding Tax (if applicable).

US Withholding Tax: All US taxpayers must submit a completed W4 and Form 673 to the HRSD. Salaries of US faculty (over the exclusion limit) qualify for the foreign earned income tax exclusion under Section 911(a) of the Internal Revenue Code. US payroll Tax Withholding is an individual’s responsibility. For individuals subject to potential US payroll taxes, it is recommended that Internal Revenue Service regulations be studied, and possibly a tax consultant or IRS agent be consulted, before your departure for the United Arab Emirates.

Bona Fide Residence Test: Bona Fide Residence must be for an uninterrupted period that includes the entire tax year (January 1 to December 31). The IRS decides a taxpayer’s eligibility for bona fide residence status on a case-by-case basis according to facts reported on the individual’s Form 2555 that is filed to report foreign earned income.

Physical Presence Test: You meet the physical presence test if you are physically present in a foreign country for 330 full days during a period of 12 consecutive months. The 330 days do not have to be consecutive, and the 12 month period need not be a calendar year. Your presence in a foreign country does not have to be only for employment; some of the time may be for vacation in another foreign country. If your period of overseas employment is longer than a year, you can overlap two 12 month periods to meet the physical presence test for the whole period of foreign residence.

Assistance with Taxes: HRSD can provide a list of fee-charging Tax Consultants available in the UAE. The American University of Sharjah cannot advise employees about taxes. You are responsible for obtaining the tax information you need and for filing your tax returns. The home page for the Internal Revenue Service on the World Wide Web is http://www.irs.gov.

Publication #54, which can be ordered from the US Government and available online: http://www.irs.gov, discusses the criteria of eligibility for foreign earned income tax in detail. Each state differs concerning this issue, so it is up to the individual to comply with the laws which affect them. The US Consulate in Dubai has tax forms for overseas filing and is very helpful in providing the appropriate forms. Before leaving home, we encourage you to check with your tax consultant.