Gratuity Calculator UAE 2025

Calculate your end of service benefits according to UAE labor law. Our gratuity calculator provides accurate estimates based on your salary, years of service, and contract type.

UAE Gratuity Calculator

AED

Enter your basic salary only (excluding allowances).

You can use decimals for partial years (e.g., 5.5 for 5 years and 6 months).

Frequently Asked Questions (FAQs) About Calculating Gratuity in Dubai and the UAE

Understanding Gratuity in the UAE

Gratuity is a lump-sum payment given to employees at the end of their service as per UAE Labour Law. It's an important benefit that recognizes an employee's years of service and contribution to the company.

Eligibility Criteria

  • You must complete at least one year of continuous service to be eligible for gratuity.
  • Gratuity is calculated based on your basic salary (excluding allowances).
  • The total gratuity amount is capped at an equivalent of two years' basic salary.

Calculation Formula

Under both the old and new UAE labour laws, gratuity is calculated as follows:

  • 21 days of basic salary for each year of the first five years of service
  • 30 days of basic salary for each additional year beyond five years

Changes Under the New Labour Law

The UAE implemented a new labour law (Federal Decree Law No. 33 of 2021) effective February 2022, which brought some changes:

  • All employment contracts are now limited-term contracts.
  • Employees now generally receive full gratuity regardless of resignation or termination (provided they complete at least one year of service).
  • The calculation formula (21 days/30 days) and two-year cap remain the same.

Important Factors Affecting Gratuity

Unpaid Leave Impact

Extended unpaid leave periods are deducted from your total service duration when calculating gratuity. Only paid leave counts toward your service years.

Partial Years Calculation

If you've worked a fraction of a year (e.g., 3 years and 7 months), the partial year is pro-rated. The calculator automatically handles this for accurate results.

Basic Salary Definition

Only your basic salary (the fixed amount before allowances) is used for gratuity calculation. Housing, transportation, and other allowances are not included.

Common Gratuity Scenarios

Scenario 1: Resignation after 3 Years

Basic Salary: AED 10,000 | Service: 3 years

Gratuity = (10,000 ÷ 30) × 21 × 3 = AED 21,000

Scenario 2: Termination after 7 Years

Basic Salary: AED 15,000 | Service: 7 years

First 5 years: (15,000 ÷ 30) × 21 × 5 = AED 52,500

Next 2 years: (15,000 ÷ 30) × 30 × 2 = AED 30,000

Total Gratuity = AED 82,500

When is Gratuity Paid?

According to UAE labor law, employers must pay gratuity within 14 days from the date when the employee's service ends. This applies whether you resign, are terminated, or reach the end of your contract.

If payment is delayed:

  • You can file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE)
  • Late payment may result in penalties for the employer
  • You have the right to pursue legal action for recovery

Read Our Comprehensive Gratuity Guide

For a detailed breakdown of UAE gratuity calculations, including edge cases, legal entitlements, and planning strategies, check out our complete guide.

Read Full Gratuity Guide →

Frequently Asked Questions

Q: Can my employer refuse to pay gratuity?

A: No. Gratuity is a legal right in the UAE after completing one year of service. Employers who refuse to pay can face legal penalties and complaints with MOHRE.

Q: Is gratuity taxable in the UAE?

A: No. Gratuity is not subject to any taxation in the UAE. However, check your home country's tax laws if you're repatriating the funds.

Q: What if I'm terminated for cause?

A: Under the new labor law, you generally still receive full gratuity even if terminated, provided you've completed at least one year of service. However, serious misconduct as defined by law may affect this.

Q: Can gratuity be paid in installments?

A: No. Gratuity must be paid as a lump sum within 14 days of the employment end date. Installment payments are not permitted under UAE labor law.

Disclaimer: While this calculator provides estimates based on UAE labor law, individual employment contracts or company policies may have variations. For definitive gratuity calculations, please consult with a legal professional or refer to the Ministry of Human Resources and Emiratisation (MOHRE). This tool is for informational purposes only.