UAE Gratuity Calculator 2026: How to Calculate End-of-Service Benefits

If you’re leaving a job in the UAE, one of the first things you’ll want to know is how much gratuity you should receive. Your employer may give you a final settlement figure, but that doesn’t always explain how the amount was worked out.

Suppose you’ve worked for a company for eight years, your monthly salary is AED 10,000, and your basic salary is AED 6,000. Under the standard UAE private-sector gratuity formula, your estimated gratuity is AED 39,000, not an amount calculated on your full AED 10,000 salary.

The UAE gratuity calculator 2026 formula uses your last basic salary and qualifying years of service. Eligible expatriate full-time employees generally receive 21 days of basic pay for each of the first five years and 30 days for each additional year.

This guide shows the calculation with worked examples, including incomplete years, unpaid leave, resignation and termination. It also explains final settlements and why different rules can apply in DIFC, ADGM and alternative savings schemes. The federal formula below does not apply to every type of employment.

UAE Gratuity Calculator 2026

To work out an estimate under the standard federal full-time formula, you need your last monthly basic salary, employment start date, final working date and any unpaid absence excluded from qualifying service. Check your employment jurisdiction first: someone covered by DIFC DEWS, ADGM rules or an eligible alternative savings scheme needs a different assessment.

Enter Your Basic Salary and Employment Dates

Start with the last basic salary recorded in your contract. Then count the qualifying period between joining and leaving, excluding unpaid absence. The comparison table and worked examples below can help you check an estimate. This page explains the formula; it does not provide a live input-based calculator.

Calculate Your Estimated Gratuity

For example, AED 6,000 in basic pay is AED 200 per day under the 30-day calculation method. Five years at 21 days gives AED 21,000; a further three years at 30 days gives AED 18,000. The combined estimate is AED 39,000, assuming no unpaid absence, special employment rules or lawful deductions.

Understand Your Calculation Breakdown

A useful gratuity estimate should show the salary figure, qualifying service, the portion calculated at 21 days and any portion calculated at 30 days. If the employer’s figure differs, request the calculation in writing before assuming either figure is correct.

What Is Gratuity in the UAE?

Gratuity is an end-of-service payment for eligible employees when employment ends. Under Article 51 of the federal private-sector Labour Law, a qualifying expatriate full-time worker generally needs at least one year of continuous service. Gratuity is separate from unpaid wages, payment for eligible unused leave and other items that may appear in a final settlement.

What Are End-of-Service Benefits?

End-of-service benefits can include several amounts, not only gratuity. An employee might correctly receive AED 20,000 in gratuity while still being owed a final salary payment or accrued leave pay. Each component should be shown separately on the settlement statement.

Who Is Covered Under UAE Labour Law?

Federal Decree-Law No. 33 of 2021, as amended, governs most private-sector employment relationships. UAE nationals generally fall under relevant pension and social-security arrangements. Domestic workers have separate legislation. DIFC and ADGM have separate employment regimes, and some employees are enrolled in funded end-of-service savings schemes. Do not apply the ordinary full-time calculator to these groups without checking the applicable rules.

Who Is Eligible for Gratuity in the UAE?

Minimum One-Year Service Requirement

Under the standard federal full-time rule, an expatriate employee must complete at least one year of continuous qualifying service. Once that minimum is met, additional fractions of a year are counted proportionately. Someone leaving after 11 months generally has no statutory gratuity under this formula; someone leaving after 14 months may qualify for a proportionate amount.

Who May Not Qualify for Gratuity?

Employees who have not met the one-year threshold do not qualify under the standard calculation. Separate frameworks apply to UAE nationals, domestic workers, some financial free-zone employees and those receiving benefits under an approved savings scheme. Eligibility should be checked against the actual employment relationship, not a general web calculator.

Does Gratuity Apply During Probation?

Probation does not create a special early gratuity entitlement. An employee who leaves during probation without completing one year of qualifying service generally receives no gratuity under the standard federal formula. Outstanding salary and other lawful entitlements are a separate question.

How to Calculate UAE Gratuity Step by Step

Step 1: Find Your Last Basic Salary

Imagine your monthly package is AED 10,000: AED 6,000 basic pay, AED 2,500 housing allowance, AED 1,000 transport allowance and AED 500 other allowance. The starting figure for standard gratuity is AED 6,000, not AED 10,000.

Step 2: Calculate Your Daily Basic Wage

For the federal examples in this guide, divide the last monthly basic salary by 30. At AED 6,000 basic salary, the daily basic wage is AED 200.

Step 3: Calculate Gratuity for the First Five Years

Multiply the daily basic wage by 21 and then by qualifying years, up to five. AED 200 × 21 × 5 = AED 21,000.

Step 4: Calculate Gratuity After Five Years

For additional qualifying years, multiply daily basic pay by 30 and by the years beyond five. For an eight-year employee, AED 200 × 30 × 3 = AED 18,000. Add the first five-year portion to reach AED 39,000.

Step 5: Adjust for Partial Years and Unpaid Leave

After completing the one-year minimum, qualifying fractions of further years are counted proportionately. Unpaid absence is excluded from qualifying service. Use your actual leave records and employment dates, not a rounded whole-year figure.

UAE Gratuity Formula for 21 Days and 30 Days

Gratuity Formula for 1 to 5 Years of Service

Gratuity Formula for More Than 5 Years

The 30-day rate applies only to the qualifying period after five years. The first five years remain at the 21-day rate.

How the Two-Year Salary Cap Works

Article 51 limits total gratuity under the standard formula to two years’ wage. With an AED 10,000 relevant monthly basic salary, the illustrative maximum is AED 240,000. The cap is a ceiling, not an automatic entitlement. UAE Government end-of-service guidance explains the general federal rules.

UAE Gratuity Calculation Examples by Salary and Years of Service

Example 1: AED 3,000 Basic Salary for 2 Years

Daily pay is AED 3,000 ÷ 30 = AED 100. Two full qualifying years give AED 100 × 21 × 2 = AED 4,200.

Example 2: AED 5,000 Basic Salary for 5 Years

Five years are 105 days of basic pay: (AED 5,000 ÷ 30) × 105 = AED 17,500. All five years are in the first rate band.

Example 3: AED 6,000 Basic Salary for 8 Years

Component	Amount
Daily basic wage	AED 200
First five years: 21 days × 5	AED 21,000
Next three years: 30 days × 3	AED 18,000
Total estimated gratuity	AED 39,000

Gratuity Calculation Table for 1 to 25 Years

The following table uses AED 6,000 last monthly basic salary, full qualifying years and no unpaid absence. Figures are illustrative and exclude other final-settlement items.

Qualifying years	Estimated gratuity (AED 6,000 basic salary)
1	AED 4,200
2	AED 8,400
3	AED 12,600
4	AED 16,800
5	AED 21,000
6	AED 27,000
7	AED 33,000
8	AED 39,000
9	AED 45,000
10	AED 51,000
11	AED 57,000
12	AED 63,000
13	AED 69,000
14	AED 75,000
15	AED 81,000
16	AED 87,000
17	AED 93,000
18	AED 99,000
19	AED 105,000
20	AED 111,000
21	AED 117,000
22	AED 123,000
23	AED 129,000
24	AED 135,000
25	AED 141,000

Is UAE Gratuity Based on Basic Salary or Gross Salary?

Which Salary Components Are Excluded?

The standard calculation uses the employee’s last basic salary. Housing, transport and similar allowances are generally excluded. If an employee takes home AED 12,000 a month but the contract shows AED 7,000 basic pay, the calculation starts at AED 7,000.

What Happens if Your Basic Salary Changes?

If an employee started at AED 4,000 basic salary and later received a contractual increase to AED 7,000, the last applicable basic salary is generally used under the standard Article 51 formula. An approved funded savings scheme can change how benefits for particular periods are calculated. Keep signed salary amendments.

How Can You Check Your Contractual Basic Salary?

Compare the latest employment contract with payslips and any signed salary revisions. If the records disagree, ask HR to confirm in writing which basic salary was effective on your final working day.

How Is Gratuity Calculated After Resignation or Termination?

Gratuity When You Resign

Resigning does not automatically reduce gratuity under the current standard federal private-sector rules. An eligible employee who resigns after six qualifying years with AED 5,000 basic salary would have an estimated AED 17,500 for the first five years plus AED 5,000 for the sixth year: AED 22,500. Do not apply resignation-reduction percentages from obsolete UAE labour-law calculators to current contracts.

Gratuity When Your Employer Terminates Your Contract

The standard formula generally applies to qualifying employees whose employer ends their contract. Questions about notice, compensation, disputes, deductions or termination circumstances must be assessed separately under the applicable law.

What Happens if You Leave Before Completing One Year?

An employee with less than one year of qualifying service does not receive statutory gratuity under the standard federal formula. Unpaid salary and other legally due amounts remain separate obligations.

How Do Unpaid Leave and Incomplete Years Affect Gratuity?

Are Unpaid Leave Days Included in Service?

Under Article 51, unpaid absence is excluded from the period used for standard gratuity. This does not mean all leave is excluded: paid annual leave and other legally recognised leave arrangements must be assessed under their own rules.

How to Calculate Gratuity for Part of a Year

An employee with two years and six months of qualifying service and AED 6,000 basic salary would have an illustrative calculation of (AED 6,000 ÷ 30) × 21 × 2.5 = AED 10,500. The fraction is payable because the minimum one-year requirement has already been met.

Example: Gratuity With Unpaid Leave

Consider AED 6,000 basic salary, three calendar years of employment and 30 days of unpaid absence. The gratuity cannot simply use three complete qualifying years. For a simplified 35-month qualifying period, AED 200 × 21 × (35 ÷ 12) = AED 12,250, compared with AED 12,600 for three full qualifying years. Actual figures must use documented dates and the legally applicable service calculation.

Does the Gratuity Formula Change for Different Employment Contracts?

Full-Time Employees

Eligible expatriate full-time employees under the standard federal framework use the 21-day and 30-day calculation.

Part-Time and Other Work Patterns

Article 52 and the implementing regulations provide a proportional calculation for eligible part-time and certain other work patterns, based on contracted annual hours relative to comparable full-time hours. A worker with 50% of comparable full-time working hours and an otherwise calculated AED 20,000 full-time entitlement might have an illustrative AED 10,000 proportionate amount, subject to the actual rules. Temporary work lasting less than one year does not qualify under the relevant provision.

Fixed-Term Contracts and Contract Renewals

Renewing a contract does not automatically mean continuous service starts again at zero. Review the actual service history and any break in employment. If an employer counts service only from the most recent renewal, ask for an explanation.

Are Gratuity Rules Different in DIFC, ADGM and UAE Free Zones?

DIFC DEWS and Qualifying Schemes

The Dubai International Financial Centre uses qualifying funded workplace savings arrangements, including DEWS. Standard employer contributions under that framework include 5.83% of monthly basic wage during the first five years and 8.33% thereafter, subject to DIFC rules. Gratuity accumulated before joining a qualifying scheme is dealt with separately. See DIFC qualifying schemes.

ADGM Employment Regulations

Abu Dhabi Global Market has separate Employment Regulations 2024, effective April 1, 2025. Although its general gratuity rates include 21 days for the first five years and 30 days afterwards, its calculation definitions differ. For example, the ADGM daily basic wage calculation uses annual basic wage divided by 365, and the rules include a minimum basic wage proportion for gratuity purposes. Employees should use ADGM-specific guidance.

Other Free Zones and Applicable Employment Laws

Being employed in a free zone does not automatically mean DIFC or ADGM rules apply. Check the employing entity, relevant free-zone authority, your contract and the actual governing law.

What Is the UAE Alternative End-of-Service Savings Scheme?

How the Savings Scheme Works

The UAE has an alternative end-of-service savings scheme in which participating employers make contributions to approved investment funds for enrolled employees. The commonly specified employer contribution rates for full-time employees are 5.83% of basic salary for less than five years’ service and 8.33% thereafter, subject to scheme rules.

Qualifying service	Employer contribution
Less than 5 years	5.83% of basic salary per month
More than 5 years	8.33% of basic salary per month

How It Differs From Traditional Gratuity

Traditional gratuity ordinarily accrues under a legal formula and is calculated when employment ends. A funded savings scheme involves contributions during employment, and benefits depend on the applicable scheme rules and investment outcomes. A contribution percentage is not a guaranteed investment return.

What Happens to Accrued Gratuity When an Employer Joins?

Benefits accumulated before enrolment must be accounted for according to the rules. An employee who has worked under both systems should ask for a breakdown of pre-enrolment gratuity and the funded benefits associated with later periods.

When Must Employers Pay Gratuity and Final Settlement?

The Final Payment Deadline

Article 53 generally requires wages and other amounts due under the standard federal private-sector law to be paid within 14 days after the employment contract ends. If HR quotes a longer timeframe, request the legal basis and written payment schedule.

What May Be Included in Final Settlement?

• Outstanding salary through the last working day
• Eligible end-of-service gratuity
• Payment for eligible unused annual leave
• Notice-related payments or other contractual dues, where applicable
• Any lawful deductions, separately explained

Unused Annual Leave, Notice Pay and Other Dues

Unused annual leave can be payable separately from gratuity. For example, ten eligible unused days at AED 6,000 monthly basic salary give an illustrative AED 2,000 using a 30-day daily rate. Notice and other entitlements need a separate legal and contractual review. See the UAE Government annual leave guidance.

Can an Employer Deduct Money From UAE Gratuity?

When Deductions May Be Permitted

Article 51 allows certain lawfully owed amounts to be deducted from gratuity under applicable legal conditions. That does not give employers unrestricted permission to subtract any alleged loss or workplace penalty. Ask for the reason and supporting documents for each deduction.

How to Check Your Final Settlement Statement

• Confirm the final basic salary used
• Verify original joining and final working dates
• Check qualifying service and unpaid absence
• Check whether the correct employment law applies
• Check unused leave and unpaid salary separately
• Request a reason for every deduction

Should You Sign a Settlement Acknowledgment Before Payment?

Read the document closely. An acknowledgment stating you have already received money is different from a statement saying the amount has been calculated. If payment has not arrived, do not sign a statement that falsely says it has. Ask for corrected wording or legal advice if there is a dispute, and keep a copy of everything you sign.

What Can You Do if Your Employer Does Not Pay Gratuity?

Documents to Collect Before Raising a Complaint

Keep the employment contract, salary revisions, payslips, joining and leaving documents, leave records, bank payment records and final settlement statement. A short written request asking HR for an itemised calculation helps establish what has been claimed and when.

How to Raise a Labour Complaint With MOHRE

For employees within MOHRE’s jurisdiction, a labour complaint may be submitted through the ministry’s official channels. The labour claims and advisory number is 80084. Explain the amount disputed, attach the relevant employment records and follow the ministry’s process. Legal deadlines may apply. See MOHRE’s official website.

What if Your Employment Is Governed by DIFC or ADGM Rules?

Use the dispute process applicable to the financial free zone. An employee whose contract is governed by DIFC or ADGM rules should not automatically assume that MOHRE’s general federal-sector labour complaint route applies.

Common UAE Gratuity Calculation Mistakes to Avoid

Using Gross Salary Instead of Basic Salary

A monthly AED 15,000 package may contain just AED 8,000 in basic salary. Using the full package produces an inflated estimate under the standard formula.

Ignoring Unpaid Leave or Partial Years

Check actual qualifying service. Unpaid absence may reduce it, and eligible fractions of years after the one-year minimum should be counted proportionately.

Applying the Wrong Employment Regime

DIFC DEWS, ADGM and approved alternative savings arrangements require checks different from a simple federal full-time calculator.

Confusing Gratuity With the Entire Final Settlement

Unpaid salary, eligible unused leave and other amounts may be due in addition to gratuity. A total settlement figure should not hide these separate entries.

UAE Gratuity Calculator 2026: Frequently Asked Questions

How much gratuity will I get after 2 years in the UAE?

Two full qualifying years give 42 days of last basic wage under the standard formula. At AED 5,000 basic salary, the illustrative amount is AED 7,000.

How much gratuity will I get after 5 years?

Five qualifying years give 105 days of last basic wage. At AED 6,000 monthly basic salary, the estimate is AED 21,000.

Can I receive gratuity if I resign?

Generally yes, after at least one year of qualifying service under the current standard federal full-time rules. Older resignation-based reductions should not automatically be applied.

Is gratuity calculated on the last basic salary?

Under the standard federal formula, yes. Allowances are excluded. Separate schemes may calculate benefits differently.

Do I get gratuity if I am terminated?

Generally, eligible employees remain subject to the applicable gratuity formula. Disputes, deductions and other payments should be assessed separately.

Is UAE gratuity taxable?

The UAE generally does not levy personal income tax on wages or ordinary employment gratuity. Foreign tax-residency rules may still matter.

Does gratuity apply to domestic workers?

Domestic workers have separate legislation. Do not apply this private-sector calculator automatically to a domestic worker’s entitlement.

Can my employer pay gratuity in instalments?

The standard federal law generally requires settlement within 14 days after employment ends. An internal instalment policy does not override legal requirements.

Does gratuity increase after five years?

Yes. Additional qualifying years beyond five use 30 days of basic pay each, while the first five years stay at 21 days each.

Does changing employers reset gratuity?

A new, separate employment relationship usually has its own service period. Transfers, continuity arrangements, mergers and savings schemes may need individual review.

What if my employer calculates less than expected?

Request an itemised breakdown of salary, service, rates and deductions. If unresolved, use the relevant official labour dispute channel.

Check Your Gratuity Before Accepting Your Final Settlement

Calculate using your actual basic salary and qualifying service, check the higher rate for years after the fifth, and review unpaid absence and permitted deductions. If you work in DIFC, ADGM or a funded savings scheme, confirm the correct rules before relying on a standard figure. A good estimate helps you spot discrepancies, but your documents and applicable employment law determine what is actually due.

Official UAE Sources

• UAE Government: End-of-Service Benefits for Private-Sector Workers
• MOHRE: Employment law and services
• UAE Government: Annual leave entitlements
• DIFC: Qualifying workplace savings schemes
• ADGM: Employment regulations and guidance

Editorial note: This guide explains the standard UAE federal gratuity framework and flags important exceptions. Estimates do not replace an employer’s legally required settlement or a determination by the competent authority. Updated November 11, 2026.