Gratuity Calculator UAE 2026 | Your Complete Guide to End-of-Service Benefits

If you’ve ever asked HR ‘how much gratuity will I get?’ and been handed a number with no explanation, you already know why this page exists. Gratuity — مكافأة نهاية الخدمة, or your End-of-Service Benefit (EOSB) — is often the single largest payment an expat will ever receive from a UAE employer. Getting the number wrong before you resign can cost you thousands of dirhams. Getting it right means you walk into that final meeting already knowing what you’re owed.

This guide explains how gratuity is calculated under UAE Labour Law, how to use the calculator above, and where the most common — and expensive — mistakes happen. Whether you’re on a new limited contract, a legacy unlimited contract, resigning, or being let go, the formula underneath is consistent across Dubai, Abu Dhabi, Sharjah, and the rest of the UAE. Local free zone exceptions are covered below.

What Is Gratuity in the UAE?

Gratuity is a legally mandated lump-sum payment your employer owes you when your employment ends, provided you’ve completed at least one full year of continuous service. It is not a bonus, not discretionary, and not something HR can decide to skip. It is set out in Federal Decree-Law No. 33 of 2021 (which replaced the older Labour Law No. 8 of 1980) and applies to:

• Private-sector expatriate employees across Dubai, Abu Dhabi, Sharjah, and all seven emirates
• Most free zone employees, including JAFZA, DMCC, and DDA
• Domestic workers, under a separate but related calculation (covered in full below)

It generally does not apply to UAE nationals, who are covered under a government pension scheme instead — a distinction that catches many people out when searching for this topic.

Gratuity is calculated on your basic salary only. Housing allowance, transport allowance, and bonuses are excluded, no matter how large a share of your total pay they represent. This single point is where more employees lose money than any other.

How the Gratuity Calculator Works

The calculator at the top of this page needs five inputs to give you an accurate figure:

• Basic monthly salary (AED) — the fixed base figure in your employment contract, not your gross or total salary
• Contract type — limited (fixed-term) or unlimited (legacy)
• Reason for leaving — resignation or termination
• First working day — use the date on your signed contract
• Last working day — your actual final day, not the date your notice was given

Once entered, the tool calculates your total service period, applies the correct 21-day or 30-day formula for each year worked, and shows a year-by-year breakdown — not just a single lump number — so you can see exactly how the total was built and verify it line by line against your HR statement.

Tip: Always use the date on your signed contract as your start date, not the date your first salary hit your bank account. These sometimes differ, and even a few days can matter near a service milestone.ws a year-by-year breakdown — not just a single lump number, so you can see exactly how the figure was built. Was built.

Limited vs. Unlimited Contracts: Which One Do You Have?

This is the area where most UAE gratuity calculators online disagree — and the reason two different tools can give you two different answers for the same numbers. Understanding which contract type applies to you is the single most important step before calculating anything.

Since February 2, 2022: All New Contracts Are Limited

When Federal Decree-Law No. 33 of 2021 came into force on February 2, 2022, all new UAE employment contracts were required to be limited (fixed-term) contracts — typically running up to three years and renewable. If you were hired after this date, you are almost certainly on a limited contract, and the resignation-penalty rules described below do not apply to you. Under a limited contract, you receive full gratuity entitlement regardless of whether you resign or are terminated (assuming you’ve served at least one year and completed your notice period).

Before February 2, 2022: You May Have a Legacy Unlimited Contract

If your contract started before February 2, 2022, and it has not since been renewed or converted into a new fixed-term agreement, you may still be on a legacy unlimited contract. These contracts carry a different — and less generous — set of resignation rules, particularly in the early years of service.

Legacy Unlimited Contract: Resignation Rules

• Under 1 year: No gratuity
• 1–3 years: You receive one-third (⅓) of the standard 21-day rate per year
• 3–5 years: You receive two-thirds (⅔) of the standard 21-day rate per year
• Over 5 years: Full entitlement — 21 days per year for the first five years, then 30 days per year after that

Legacy Unlimited Contract: Termination Rules

If your employer terminates you without misconduct from a legacy unlimited contract, the resignation reduction above does not apply. You receive the full 21/30-day rate regardless of service length, as long as you have passed the one-year mark.

If your contract predates February 2022 and has not been renewed since, confirm your contract type directly with your HR department or MOHRE before making any resignation decision. The financial difference between the two types can be significant.

Gratuity Entitlement at a Glance

Service Period	Resignation (Unlimited)	Termination (Unlimited)	Limited Contract
Under 1 year	No gratuity	No gratuity	No gratuity
1–3 years	⅓ of 21-day rate	Full 21-day rate	Full 21-day rate
3–5 years	⅔ of 21-day rate	Full 21-day rate	Full 21-day rate
Over 5 years	Full (21-day then 30-day)	Full (21-day then 30-day)	Full (21-day then 30-day)

Note: ‘Limited contract’ here refers to post-February 2022 contracts, or pre-2022 contracts that have been formally renewed under the new law.

The Gratuity Formula: How the Math Works

The formula is consistent across all seven emirates — Dubai, Abu Dhabi, and Sharjah all apply the same federal calculation. The only variable is how many years fall on each side of the five-year mark.

For your first five years: Gratuity = (Basic Salary ÷ 30) × 21 × Years Served For every year beyond five years: Gratuity = (Basic Salary ÷ 30) × 30 × Additional Years

Partial years are prorated. If you’ve worked 5 years and 7 months, those extra 7 months count proportionally toward your total. This is exactly the kind of calculation that’s easy to get wrong by hand, which is where the calculator above earns its place.

The maximum gratuity payout is capped at two years’ basic salary, regardless of how long you’ve worked. If your basic salary is AED 10,000 per month, your absolute ceiling is AED 240,000.

Worked Examples

Scenario	Calculation	Total
Limited contract, 6 years, AED 15,000 basic	Years 1–5: (15,000÷30)×21×5 = AED 52,500 Year 6: (15,000÷30)×30×1 = AED 15,000	AED 67,500
Legacy unlimited, resign after 4 years, AED 10,000 basic	Years 1–3 (⅓ rate): (10,000÷30)×21×⅓×3 = AED 7,000 Year 4 (⅔ rate): (10,000÷30)×21×⅔ = AED 4,667	AED 11,667
Domestic worker, 3 years, AED 2,500 basic	AED 2,500 × 3.33% × 36 months ≈ AED 2,500/year	~AED 7,500–8,300

Gratuity for Domestic Workers in the UAE

Domestic workers — nannies, drivers, household managers, gardeners, cooks, and cleaners — are covered separately under Federal Decree-Law No. 9 of 2022 on Domestic Workers, rather than the standard labour law used above. The core principle is the same: at least one full year of continuous service is required before gratuity applies, and the payout is calculated on basic monthly wage.

For domestic workers, gratuity is generally calculated as:

Basic monthly wage × 3.33% × number of months worked  (roughly 12 days’ wage per year of service)

One detail that catches people out: if a domestic worker was placed through a recruitment agency rather than hired directly, the agency — not the household employer — may hold responsibility for settling the end-of-service payment, depending on the terms of the placement agreement. Always check who signed the employment contract, not just who pays the monthly wage.

Why Two Gratuity Calculators Give Different Numbers

If you’ve tried another UAE gratuity calculator and gotten a different figure, you’re not imagining it — and it’s not necessarily a bug. The three most common causes:

• Legacy vs. new contract confusion — some tools apply the resignation-penalty reduction to everyone; others apply it to no one. The correct answer depends entirely on your contract start date.
• Gross salary entered instead of basic salary — this single error can inflate or deflate your result by 30–50%, depending on your allowance structure.
• Date-counting differences — some tools count a year as 360 days, others 365 — a small difference that compounds over long service periods.

If you are getting conflicting numbers, use the year-by-year breakdown this calculator produces as your reference point, then cross-check the specific figure against your actual contract wording or with MOHRE directly before making any decision based on it.

Who Is Eligible for Gratuity?

You qualify if:

• You’ve completed at least one continuous year of service with the same employer
• You’re a private-sector expatriate employee, or a free zone employee under JAFZA, DMCC, DDA, or similar
• You were not dismissed for serious misconduct under Article 120 of the Labour Law
• You did not resign without serving your contractual notice period

You will not receive gratuity if you leave — for any reason — before completing one full year. This is a hard cutoff with no exceptions.

Free Zones: DIFC and ADGM Work Differently

Most UAE free zones — JAFZA, DMCC, DDA, and others — follow the same federal gratuity formula described above. DIFC and ADGM are the two exceptions.

• DIFC employees are covered under the DEWS (DIFC Employee Workplace Savings) scheme — a funded, investment-based savings plan your employer contributes to monthly, rather than a lump-sum gratuity calculated at termination.
• ADGM allows employers to opt into a similar savings-scheme structure instead of traditional gratuity.

If you work in either free zone, do not rely on the standard formula above. Check your specific scheme documentation, as the payout mechanics are genuinely different — not just a variation of the same math.

Your Final Settlement Includes More Than Gratuity

Gratuity is usually the largest line item, but it’s one part of a broader final settlement. A complete settlement under UAE Labour Law typically includes:

• Gratuity (EOSB) — calculated as above
• Unpaid salary up to your last working day
• Accrued annual leave, converted to salary based on your basic pay
• Notice period pay, if your employer waives your notice and asks you to leave immediately
• Repatriation costs, where applicable under your contract
• Deductions for any amounts legitimately owed — loans, advances, and similar

Important: Under Article 53, your employer is required to settle all dues in full within 14 days of your last working day. If they do not, you have the right to file a wage complaint with MOHRE.

Real Mistakes That Cost UAE Employees Real Money

1. Entering Gross Salary Instead of Basic Salary

This is the single biggest source of incorrect results — across every calculator online, including this one if the wrong figure goes in. Your basic salary is the fixed base amount stated in your employment contract. It does not include housing allowance, transport allowance, commission, or bonuses, regardless of how those are listed on your payslip.

2. Falling for Salary-Splitting Arrangements

Some employers structure contracts with an artificially low basic salary and inflated allowances specifically to reduce gratuity liability. The gratuity calculation uses the contractual basic salary figure only. Check your actual signed contract, not just your payslip total, before calculating anything.

3. Using the Wrong Start Date

Use the date on your signed employment contract as your start date. Some employees use the date their first payslip was issued or when their visa was processed — these can differ by weeks or months, and the difference can push your total service across a calculation threshold.

4. Resigning Just Before a Service Milestone

Crossing the five-year mark unlocks the 30-day calculation rate for every year of service after that point. If you are at 4 years and 10 months, waiting two months before resigning can meaningfully change your total entitlement. Run the numbers before you decide.

5. Assuming Years Abroad Count

They do not. UAE gratuity is calculated purely on continuous service with your current UAE employer. Prior employment in another country — or even with a related company in a different jurisdiction — does not count.

6. Accepting a Verbal Number Without a Written Breakdown

Always request your gratuity calculation in writing before signing anything. Check it line by line against your own calculation. Discrepancies are not always intentional, but they do happen — and once you’ve signed the final settlement, disputing it becomes significantly harder.

How to Protect and Maximize Your Gratuity

• Request a written end-of-service statement periodically — not just at resignation. This gives you an independent record to check against, and it catches underpayment errors while there is still time to address them.
• Know your contract type before you need to. Don’t wait until your resignation letter is drafted to find out whether you’re on a legacy unlimited contract. The difference materially changes what you’re owed.
• Keep your paper trail. Save your signed offer letter, employment contract, labour card, and payslips showing your basic salary figure clearly.
• Raise basic salary discrepancies early. If your basic salary was quietly restructured to a lower figure, flag it with HR while you still have leverage — before you give notice.
• Time your exit around service milestones. If you’re close to the one-year or five-year mark, even a short delay can be worth calculating.
• Escalate through the right channel. If your employer delays or disputes settlement beyond the 14-day window under Article 53, file a wage complaint with MOHRE. If unresolved, cases can proceed to the labour court.

Checking Your Entitlement Through MOHRE Directly

This calculator gives you an accurate estimate, but MOHRE also provides its own check if you want to see the figure from the official source:

• Install the MOHRE Smart App and sign in with your UAE Pass
• Select Employee, then navigate to End of Service Calculator
• Enter your contract type, joining date, last working day, and reason for leaving
• Review the figure MOHRE’s system generates

Cross-checking your own calculation against the MOHRE app result is a smart habit before you sign any final settlement document.

Tip: If your employer is disputing your gratuity or delaying payment beyond 14 days, you can file a complaint directly through the MOHRE app or website. The complaint triggers a formal mediation process. If unresolved within the specified period, the case is referred automatically to the labour court.

DIFC and ADGM: A Separate Note

If you work in DIFC, your end-of-service benefit is handled through the DEWS (DIFC Employee Workplace Savings) scheme — a funded savings plan your employer contributes to monthly on your behalf. ADGM allows employers to adopt a similar structure. In both cases, the standard federal formula on this page does not apply. Consult your HR department or your scheme provider for the specific payout calculation relevant to your contract.

Frequently Asked Questions

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This calculator provides an estimate for planning purposes based on Federal Decree-Law No. 33 of 2021. It is not a substitute for an official calculation from your employer or MOHRE. For a legal opinion on your specific contract, consult MOHRE directly or a licensed UAE labour lawyer.