UAE Gratuity Calculator
Calculate your end-of-service gratuity benefits as per UAE Labour Law. Supports limited and unlimited contracts with instant daily wage calculation.
Employment Details
Basic salary only. Excludes allowances, bonuses, and overtime.
Fixed-term contract with a specified end date.
Your Gratuity Amount
Calculation Breakdown
= AED 0.00
Gratuity Status
The UAE has no personal income tax. Your gratuity is paid in full with no tax deductions.
Employer must pay gratuity within 14 days of the last working day as per UAE Labour Law.
How UAE Gratuity is Calculated
Under the UAE Labour Law (Federal Decree-Law No. 33 of 2021), employees who complete at least one year of continuous service are entitled to end-of-service gratuity. The calculation depends on the contract type, reason for leaving, and length of service.
Termination by Employer / Contract Expiry
Resignation by Employee
Daily Wage Method
Maximum Gratuity Cap
Calculation Examples
| Scenario | Monthly Salary | Service | Exit Type | Gratuity (AED) |
|---|---|---|---|---|
| Employee A | AED 10,000 | 3 years | Terminated | 21,000.00 |
| Employee B | AED 15,000 | 7 years | Terminated | 82,500.00 |
| Employee C | AED 10,000 | 2 years | Resigned | 4,666.67 |
| Employee D | AED 10,000 | 4 years | Resigned | 18,666.67 |
| Employee E | AED 20,000 | 10 years | Resigned | 170,000.00 |
Frequently Asked Questions
Is gratuity taxable in UAE?
No. The UAE does not impose personal income tax. End-of-service gratuity is paid in full to the employee without any tax deductions. This applies to all employees regardless of nationality or contract type.
What is the maximum gratuity an employee can receive?
As per UAE Labour Law, the total gratuity amount cannot exceed 2 years' worth of the employee's salary (24 months of basic salary). This cap applies regardless of how many years the employee has worked.
When is gratuity paid after end of service?
The employer must pay the gratuity within 14 days from the employee's last working day. If the employer fails to pay within this period, the employee can file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE).
Is gratuity calculated on basic salary or total salary?
Gratuity in the UAE is calculated on the basic salary only. Allowances such as housing, transport, phone, and other benefits are not included in the gratuity calculation. The daily wage is derived as monthly basic salary divided by 30.
Can an employee be denied gratuity?
An employee can be denied gratuity only if they are dismissed under Article 44 of the UAE Labour Law (gross misconduct, such as assaulting the employer, forging documents, or revealing trade secrets). In all other cases, including resignation and termination, the employee is entitled to gratuity after completing 1 year of service.
What changed with the new UAE Labour Law (2022)?
The new UAE Labour Law (Federal Decree-Law No. 33 of 2021), effective from February 2, 2022, introduced changes including the conversion of all contracts to fixed-term (limited) contracts. However, the gratuity calculation formula remains largely the same. Employers can now also opt for alternative end-of-service savings schemes approved by the government.
Automate Gratuity Calculations for Your UAE Team
Our UAE Payroll & HRMS automatically tracks service years, calculates end-of-service gratuity as per UAE Labour Law, and ensures compliance for both limited and unlimited contracts.