UAE End-of-Service Gratuity Calculator 2026
Free UAE gratuity calculator based on Federal Decree-Law No. 33 of 2021. Enter your BASIC salary and length of service to see your end-of-service benefit — 21 days per year for the first 5 years, 30 days after — with the resignation-vs-termination answer and the 2-year cap built in.
Your Gratuity
Total End-of-Service Gratuity
AED 0
What Is End-of-Service Gratuity in the UAE?
End-of-service gratuity (often just "gratuity", or mukafa'at nihayat al-khidma) is a lump-sum payment your employer owes you when your employment ends. It is the UAE's version of a statutory severance benefit, and for the millions of expatriates who make up the private-sector workforce it is usually the single largest payment they receive on leaving a job. The entitlement is set by Article 51 of Federal Decree-Law No. 33 of 2021 — the UAE Labour Law that came into force on 2 February 2022 — together with Cabinet Resolution No. 1 of 2022. It replaced the older Federal Law No. 8 of 1980 and, crucially, changed several rules that most online calculators still get wrong.
Gratuity is a legal minimum, not a bonus. As long as you complete at least one year of continuous service and are not dismissed for one of the narrow gross-misconduct grounds in Article 44, your employer must pay it — regardless of whether you resigned or were let go. This UAE gratuity calculator applies the current 21/30-day formula to your basic salary, prorates any partial year, and caps the result at two years' basic pay, so the figure you see is the mainland federal-law entitlement.
The 21/30-Day Rule (Article 51)
Gratuity accrues in days of basic wage for each year of service, at two different rates:
| Period of service | Accrual rate | In months of basic pay |
|---|---|---|
| Under 1 year | No gratuity | — |
| Each of the first 5 years | 21 days' basic wage / year | 0.7 month / year (3.5 months at 5 yrs) |
| Each year beyond 5 | 30 days' basic wage / year | 1 month / year |
| Overall maximum | Capped at 2 years' basic wage | 24 months |
To turn days into money, the law uses a daily wage of basic monthly salary ÷ 30. So the calculation is:
Daily wage = Basic monthly salary ÷ 30
First-5-years portion = 21 × daily wage × min(years, 5)
Beyond-5 portion = 30 × daily wage × max(years − 5, 0)
Gratuity = min(first-5 + beyond-5, basic × 24)
Partial years are paid pro-rata once you have completed your first full year. Six extra months is worth half a year of accrual, not nothing — the law is explicit that "fractions of a year" are paid proportionately.
Basic Salary vs Total Salary — the #1 Mistake
Article 51 calculates gratuity on your last basic wage only. Allowances are excluded — housing, transport, mobile, education, fuel, and any other top-up that appears as a separate line on your contract or payslip. This matters enormously in the Gulf, where pay packages are deliberately structured with a modest basic and large allowances.
Take a common AED 20,000 monthly package split as AED 12,000 basic + AED 8,000 allowances. Gratuity is worked out on the AED 12,000, so after 5 years you receive 21 × 5 × (12,000 ÷ 30) = AED 42,000 — not the AED 70,000 you would get if the whole AED 20,000 counted. Using the total figure overstates the payout by more than half. Before you rely on any estimate, find the exact "basic salary" number on your labour contract and enter that.
Resignation vs Termination: Why the Amount Is Now the Same
This is the biggest change under the 2021 law, and the point most competing calculators still get wrong. Resigning no longer reduces your gratuity.
Under the old Federal Law No. 8 of 1980, an employee on an unlimited contract who resigned lost a chunk of their gratuity based on tenure:
| Service on resignation | Old law (unlimited contract) | Current law (2021) |
|---|---|---|
| 1 to 3 years | Only 1/3 of gratuity paid | Full gratuity |
| 3 to 5 years | Only 2/3 of gratuity paid | Full gratuity |
| Over 5 years | Full gratuity | Full gratuity |
Federal Decree-Law No. 33 of 2021 abolished those reductions. It converted every private-sector employee to a limited-term contract and applied one gratuity rule to everyone, so a resigning worker and a terminated worker with identical basic pay and tenure now receive exactly the same amount. That is why this calculator shows the same figure whichever reason you pick — the reason field is there for reassurance, not because it changes the maths. If another tool docks your gratuity for resigning, it is running pre-2022 rules.
The one situation where you still forfeit gratuity is dismissal for gross misconduct under Article 44 (for example, assault, drunkenness at work, disclosing trade secrets, or unexplained absence of more than 7 consecutive or 20 non-consecutive days). Ordinary resignation and ordinary termination are not affected.
The 2-Year Cap
No matter how long you stay, total gratuity can never exceed two years' basic salary (24 months). Because each year past the fifth accrues one month of basic wage, and the first five years accrue 3.5 months in total, you hit the cap at roughly 25 years and 6 months of service (3.5 + 20.5 = 24 months). After that, extra years add nothing to the payout. The calculator flags whenever the cap has reduced your figure, and shows both the uncapped accrual and the capped result so you can see the difference.
Worked Examples
Example 1: 3 years, AED 10,000 basic, resignation
Priya has a basic salary of AED 10,000 and resigns after exactly 3 years.
- Daily wage = 10,000 ÷ 30 = AED 333.33
- All 3 years are in the first-5 band: 21 × 3 = 63 days
- Gratuity = 333.33 × 63 = AED 21,000
- Cap (2 yrs = AED 240,000) not reached; resignation pays the same as termination
Example 2: 8 years 6 months, AED 15,000 basic, termination
James has a basic salary of AED 15,000 and is terminated after 8 years and 6 months.
- Daily wage = 15,000 ÷ 30 = AED 500
- First 5 years: 21 × 5 = 105 days → 500 × 105 = AED 52,500
- Remaining 3.5 years: 30 × 3.5 = 105 days → 500 × 105 = AED 52,500
- Total gratuity = AED 105,000 (7 months of basic pay)
- Cap (AED 360,000) not reached
Example 3: 30 years, AED 20,000 basic — the cap bites
Ahmed has a basic salary of AED 20,000 and 30 years of service.
- Daily wage = 20,000 ÷ 30 = AED 666.67
- First 5 years: 21 × 5 = 105 days → AED 70,000
- Remaining 25 years: 30 × 25 = 750 days → AED 500,000
- Uncapped accrual = AED 570,000 (28.5 months)
- Cap = 24 × 20,000 = AED 480,000 → payout is AED 480,000
Free Zones: DIFC, ADGM and DEWS
This calculator gives the mainland / federal-law figure. Two financial free zones run their own end-of-service systems instead of the 21/30-day formula:
- DIFC (Dubai International Financial Centre) replaced gratuity with the DEWS scheme (DIFC Employee Workplace Savings) in 2020. Employers pay a monthly contribution — 5.83% of basic salary for the first five years of service, 8.33% thereafter — into a funded, invested savings account. Your end-of-service benefit is the accumulated balance, which may be worth more or less than a classic gratuity depending on investment returns.
- ADGM (Abu Dhabi Global Market) operates a comparable workplace savings arrangement.
If you work in DIFC or ADGM, rely on your scheme statement rather than this tool. Most non-financial free zones (JAFZA, DMCC, Dubai Media City and so on) follow the federal 21/30-day rule, so this calculator applies to them.
When and How You Get Paid
- Deadline. Article 53 requires the employer to pay all final dues — outstanding wages, unused leave, and gratuity — within 14 days of the contract ending.
- Lawful deductions. The employer may deduct amounts you genuinely owe them (an outstanding staff loan, for example) from the gratuity.
- Disputes. If gratuity is unpaid or miscalculated, file a complaint with the Ministry of Human Resources & Emiratisation (MOHRE), which mediates private-sector labour disputes for free before any referral to the labour courts.
- Unpaid leave. Days of unpaid absence are not counted toward your years of service, so long stretches of unpaid leave can reduce the accrual.
Disclaimer: This calculator and guide are for general information only and do not constitute legal or financial advice. Figures reflect Federal Decree-Law No. 33 of 2021 (Articles 51-53) and Cabinet Resolution No. 1 of 2022 as of July 2026, for mainland private-sector employment. DIFC, ADGM, government and free-zone-specific arrangements may differ. For a dispute or a large settlement, consult a licensed UAE employment lawyer or MOHRE.
Official Sources
FAQ
Is gratuity calculated on basic salary or total salary in the UAE?
Gratuity is calculated on your BASIC salary only, not your total (gross) salary. Article 51 of Federal Decree-Law No. 33 of 2021 defines the entitlement on the last basic wage and expressly excludes allowances such as housing, transport, mobile, and any other add-ons on top of basic pay. This is the single most common mistake people make: if your total package is AED 20,000 made up of AED 12,000 basic plus AED 8,000 in allowances, your gratuity is worked out on the AED 12,000 figure. Always check the 'basic salary' line on your contract or payslip before estimating — using the total figure overstates gratuity by 40-60% for a typical Gulf pay structure.
Do I get gratuity if I resign in the UAE?
Yes — and under the current law you get the FULL amount. Provided you have completed at least one year of continuous service, a resigning employee accrues exactly the same 21/30-day gratuity as an employee who is terminated. This changed with Federal Decree-Law No. 33 of 2021 (in force since 2 February 2022): the old-law penalties that cut a resigning worker's gratuity by two-thirds (1-3 years) or one-third (3-5 years) on unlimited contracts were abolished when all contracts became limited-term. Many online calculators still apply those scrapped deductions, so if a tool reduces your gratuity because you resigned, it is using outdated rules.
What is the difference between gratuity on a limited vs unlimited contract in the UAE?
There is no longer any difference. Under the old law, limited (fixed-term) and unlimited contracts used different gratuity formulas, and resignation on an unlimited contract triggered reductions. Federal Decree-Law No. 33 of 2021 converted every private-sector employee to a limited-term contract, so a single rule now applies to everyone: 21 days' basic wage per year for the first five years and 30 days per year thereafter, whether you resign or are terminated. If you are comparing an old employment contract described as 'unlimited', note that it was required to be transitioned to the new limited-term format, and the new gratuity rule governs your end-of-service benefit.
What is the minimum service to qualify for gratuity in the UAE?
You must complete at least one year of continuous service (Article 51). If you leave before completing 12 months, no gratuity is payable. Once you pass the one-year mark, you also earn gratuity on the fractional part of any further year, pro-rated to the exact time served — so 3 years and 6 months earns 3.5 years' worth of accrual, not 3. Days of unpaid absence can be deducted from the service period when calculating the total.
How is end-of-service gratuity calculated in the UAE?
First find your daily wage: basic monthly salary divided by 30. For the first five years of service you earn 21 days of that daily wage per year; for every year beyond five you earn 30 days per year. Add the two portions together, then apply the cap: total gratuity can never exceed two years' basic salary (24 months). Example: on an AED 15,000 basic salary with 8 years 6 months of service, the daily wage is AED 500. The first-5-years portion is 21 x 5 x 500 = AED 52,500, and the beyond-5 portion is 30 x 3.5 x 500 = AED 52,500, for a total gratuity of AED 105,000.
Is there a maximum limit on UAE gratuity?
Yes. Article 51 caps total gratuity at the equivalent of two years' basic salary (24 months of basic wage), no matter how long you have worked. Because each year beyond the first five accrues one month of basic wage (30 days) and the first five years accrue 3.5 months in total, the cap is reached at around 25 years and six months of service. Beyond that point, extra years do not increase the payout. For example, on an AED 20,000 basic salary the cap is AED 480,000 — an employee with 30 years of service would accrue AED 570,000 on the raw formula but receives AED 480,000 after the cap.
Does gratuity apply in DIFC and ADGM free zones?
Not in the same way. This calculator computes the mainland, federal-law figure using the 21/30-day formula. Two financial free zones run their own systems: the DIFC replaced end-of-service gratuity with the DEWS scheme (DIFC Employee Workplace Savings), a funded plan where the employer pays a monthly percentage of basic salary into an investment account, and Abu Dhabi Global Market (ADGM) operates a similar savings arrangement. If you work in DIFC or ADGM, your end-of-service benefit is the accumulated savings pot rather than the federal gratuity, so use your scheme statement instead of this tool. Most other UAE free zones (JAFZA, DMCC, etc.) follow the federal 21/30-day rule.
When must my employer pay my gratuity?
Within 14 days of the end of the contract. Article 53 of the UAE Labour Law requires the employer to pay all outstanding wages, other entitlements and the end-of-service gratuity within 14 days of the termination date. The employer may lawfully deduct amounts you owe them (for example an outstanding loan) from the gratuity. If payment is not made, you can file a complaint with the Ministry of Human Resources and Emiratisation (MOHRE), which handles private-sector labour disputes.