PennyCompass

UAE Compound Interest Calculator

Free UAE compound interest calculator in AED. Project investment growth with regular contributions and compounding, with no tax on the gains.

Published

Project investment growth in AED with regular contributions.

Future value (gross = net)

Total contributions

Total growth

Tax on gains

Worked example

Start with AED 50,000 invested and add AED 2,000 every month for 20 years, assuming a 7% annual return compounded monthly. Over the period you put in AED 530,000 of your own money, made up of the AED 50,000 opening balance plus AED 24,000 a year across 20 years. Compounding does the heavy lifting: the balance grows to about AED 1,249,868, which means roughly AED 719,868 is investment growth on top of what you contributed. Because the UAE levies no personal capital gains or dividend tax, this gross figure is also what you keep. The growth ends up larger than the contributions because each year earns a return on a base that already includes prior years of gains.

Step Amount

How it is calculated

The projection steps through the investment period by period and applies the chosen compounding frequency. The opening balance plus each regular contribution earns a periodic return, and that return is added back to the balance so the next period earns on a slightly larger base. This is what makes growth accelerate over time rather than stay flat. Contributions here are treated as deposited at the start of each month, and the annual rate is split across the compounding periods. Total contributions are your deposits, total growth is the balance less those deposits, and the future value is the two combined. Since UAE individuals pay no tax on personal investment gains, the gross figure shown is also the net.

Frequently asked questions

Are investment gains taxed in the UAE?
No. The UAE has no personal income tax, no individual capital gains tax, and no dividend tax on investments held in a personal capacity. The future value shown here is the gross figure, and because individual investment gains are untaxed, the gross figure is also what you keep.
Does the UAE corporate tax affect personal investment returns?
The 9% corporate tax introduced in 2023 applies to business entities earning above AED 375,000 in net profit, not to individuals investing in their own name. Dividends received by UAE resident individuals from UAE or foreign companies remain untaxed at the personal level, so the calculator gross figure still equals the net figure for personal investors.
What compounding frequency is most common for UAE savings accounts and funds?
Most UAE bank savings accounts compound interest monthly, while fixed deposits typically compound at maturity or annually. Mutual funds and ETFs listed on the Abu Dhabi Securities Exchange or Dubai Financial Market reinvest gains continuously, which is closest to daily compounding. Choosing the matching frequency in this calculator gives the most accurate projection for a specific product.
How does the UAE regulatory environment affect long-term investment projections?
The UAE Securities and Commodities Authority (SCA) and the Dubai Financial Services Authority (DFSA) regulate investment products available to UAE residents. Regulated products must disclose fees, which reduce effective returns. When using this calculator, subtract annual fund management fees or platform charges from the gross annual return rate to get a realistic net-of-fees projection.

Related calculators

Sources

  1. Federal Tax Authority — VAT and Corporate Tax, Federal Tax Authority, United Arab Emirates
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