Online Gratuity Calculator UAE 2026 (MOHRE Updated)

Ask any employment lawyer in the UAE what causes the most gratuity disputes, and the answer is nearly always the same: using the full salary instead of the basic salary. A common contract splits AED 20,000 total pay into AED 12,000 basic and AED 8,000 in allowances, and gratuity only ever counts the AED 12,000. Missing that distinction can inflate your expected payout by thousands of dirhams.

This Gratuity Calculator UAE avoids that mistake, giving you an instant estimate of your end of service benefit under Federal Decree-Law No. 33 of 2021 and current MOHRE rules, for any private sector employee with at least one year of continuous service. Gratuity is also called end of service benefits, or indemnity in older usage, and MOHRE was previously known as the Ministry of Labour, or MOL, so some older documents still use that name.

This online calculator saves you the trouble of trying to compute gratuity in UAE by hand, though the formula is simple enough to check yourself using the method explained below. Enter your basic salary, your joining date, and your last working day above to see your full breakdown, along with a downloadable PDF you can keep for HR discussions or your own records.

How to Use This Gratuity Calculator UAE

You do not need to memorize any formulas to use this tool. Just follow these steps:

The calculator works out your daily wage, applies the correct number of gratuity days for each year you worked, and checks the result against the legal two year cap automatically.

UAE Gratuity Calculation Formula (Official MOHRE Rules)

According to the official calculation rules published by the UAE Government, gratuity is worked out in tiers based on your total years of service.

The daily wage used in every calculation is your basic salary divided by 30.

Why Divide by 30 Instead of the Real Number of Days in the Month?

This is one of the most common questions people ask after running their own numbers. The 30 day method is a fixed standard used across UAE payroll practice, regardless of whether a month has 28, 30, or 31 days. The law does not force a single method for this step, but the 30 day division is the version MOHRE and most HR systems apply, so it is the one this tool uses too.

Why Do Different Calculators Give Different Answers?

Most disagreements between calculators come from three sources. Some tools quietly include allowances in the salary field. Some count calendar days instead of working days for the service period. A few still run the old resignation penalty from before 2022, even though that rule no longer applies. When two calculators disagree, check which of these three assumptions is different before assuming either one is wrong.

Worked Example

That is your full gratuity amount, before any lawful deductions your employer may apply, such as unpaid loans or advances.

How to Calculate and Verify Your Basic Salary

Since your basic salary drives almost every payout on this page, from gratuity to leave encashment, getting this one number right matters more than any other input.

Where to Find Your Basic Salary

Your basic salary is written directly in your signed employment contract, usually as a separate line item from housing allowance, transport allowance, and any other benefits. If you cannot locate your contract, your HR or payroll team can confirm the figure, or you can view it through the MOHRE app under your registered employment details.

Basic Salary vs Gross Salary: A Quick Payroll Breakdown

Most UAE employment contracts split your monthly pay into a basic salary component and one or more allowances. A typical structure looks like this.

There is no single fixed percentage required by law, so always check your own contract rather than assuming a standard split.

How to Compute Your Salary Per Day in the UAE

Once you know your basic salary, computing your daily rate is simple. Basic salary divided by 30 gives your daily wage, the same figure this calculator uses internally for the gratuity formula. This per-day figure is also useful for working out deductions for unpaid leave or partial month calculations in general payroll calculation, not just gratuity.

Using a Generic Salary or Payroll Calculator

Many people search for a general UAE salary calculator, a Dubai salary calculator, or a monthly salary calculator UAE expecting a tool that reverse-engineers gross pay into take-home pay after any deductions. This gratuity tool is not that kind of payroll calculator. It only needs your basic salary as an input, not your full payroll breakdown, since gratuity, leave encashment, and the daily wage figure all rely on the basic salary alone.

Who Is Eligible for Gratuity Calculation in the UAE?

The eligibility criteria are simple, but they trip people up more often than the formula itself.

A common question is what happens at exactly 11 months. If your continuous service is under 365 days, you are not entitled to any gratuity at all, even if you are one day short of the full year.

Does Resignation or Termination Change the Amount?

Common Mistakes People Make With Gratuity Calculation

A common mistake is entering total salary instead of basic salary, which produces a gratuity estimate much higher than what you are actually entitled to. 

Checking your own numbers against this list before you raise a query with HR can save a lot of back and forth.

Resignation vs Termination: What Changed Under the New Law

If you have read older articles or heard from a friend that resigning early cuts your gratuity by a third or two thirds, that information is out of date. That penalty belonged to the old unlimited contract system under the previous 1980 labour law.

Under the current Federal Decree-Law No. 33 of 2021, there is no reduction in gratuity for resigning. An employee who resigns after completing one year of continuous service receives the exact same gratuity as an employee who is terminated without cause after the same length of service.

There is one narrow exception worth understanding. Article 44 of the labour law lists specific grounds for summary dismissal, covering serious misconduct such as proven fraud, assault, or being drunk at work. Legal sources do not fully agree on how this interacts with gratuity. Some analyses state that gratuity is forfeited entirely if a dismissal genuinely falls under Article 44, while others point out that recent labour court interpretations often still preserve the gratuity right, with employers instead pursuing separate damages claims. If your case involves a misconduct dismissal, this is exactly the kind of situation where you should confirm your position directly with MOHRE or a labour lawyer rather than relying on any calculator, including this one.

Outside of that narrow scenario, your notice period also plays a role. If you serve your full notice period, those days count toward your total service and can add to your gratuity. If your employer asks you to leave immediately and pays you in lieu of notice, that time typically does not count toward your service length. For the full picture on notice periods, valid grounds for resigning without notice, and what happens if your employer breaks the rules, see our UAE labour law guide.

Old Law vs New Law: A Quick Comparison

Many older articles and forum posts still describe rules from before February 2022, when the current law took effect. Here is a simple side by side view so you can spot outdated advice right away.

If a website or a friend quotes the one third or two thirds rule to you today, that advice describes a system that no longer applies to most current employment contracts.

Your Full Final Settlement: Beyond Gratuity

Gratuity is only one part of what you are owed when a job in the UAE ends. Many people search for an end of service calculator, an EOSB calculator, or an indemnity calculator expecting the same thing as a gratuity calculator, but a full final settlement, sometimes written as نهاية الخدمة, is actually broader. If you only check your gratuity number, you may be leaving money on the table.

Leave Encashment: The Part People Forget

Your employer must pay you in cash for any annual leave days you earned but never used, calculated on your basic wage only. This applies whether you resign, get terminated, or your contract simply ends. Keep a record of your leave balance yourself, since payroll systems sometimes undercount it.

Notice Pay and Pay in Lieu of Notice

Notice periods in the UAE generally run between 30 and 90 days, as set in your contract. Either side can choose to pay in lieu of notice instead of working it out. Notice pay is generally calculated using your contractual wage, which typically includes fixed allowances, not your basic salary alone, so this figure is usually higher than a simple basic-salary calculation would suggest.

Worked Example: Full Settlement

What Employers Can Legally Deduct

Employers may lawfully subtract outstanding personal loans, salary advances, or the value of unreturned company property from your final settlement. They cannot deduct amounts simply because they disagree with your resignation, and any deduction should be clearly itemized on your settlement letter.

Final Settlement vs Severance Pay

Some employees use the term severance pay when they mean final settlement, especially those who previously worked in countries where severance is calculated differently. In the UAE, there is no separate severance payment layered on top of gratuity, leave encashment, and notice pay. What some call severance here is simply the combined final settlement described above.

Documents to Gather Before You Calculate

Having the right paperwork ready makes your final settlement estimate far more accurate.

Quick Check Before You Sign Your Settlement Letter

Before signing anything HR hands you, verify these five items line by line.

Final Settlement for Part Time Contracts

Part time employees are entitled to a final settlement too, calculated on a pro rated basis under Cabinet Resolution No. 1 of 2022. The method works by calculating the full time equivalent figure first, then applying the ratio of contracted hours to standard full time hours.

The Two Year Gratuity Cap Explained

No matter how many years you have worked, your total gratuity payout cannot exceed two years of your basic salary. This cap applies uniformly, whether you work in Dubai, Abu Dhabi, Sharjah, or any other emirate, and whether your contract is fixed term or one of the older open ended agreements still winding down under the previous system.

Who Should Not Rely on This Calculator

This tool is built for standard, full time private sector employment under Federal Decree-Law No. 33 of 2021. It is not a good fit for every situation, and you should treat the result as a starting point, not a final figure, if any of the following apply to you.

Gratuity Calculation in Free Zones, DIFC, ADGM and the Savings Scheme

Most free zones across the UAE, including JAFZA, DMCC, and the Dubai Development Authority (DDA), follow the same federal gratuity formula described above. If you work in one of these zones, our dedicated free zone gratuity calculator walks through the small differences in process and documentation you may run into.

DIFC and ADGM are different. These two financial free zones are not covered by Federal Decree-Law No. 33 of 2021 at all, and they run their own separate employment regulations. Since February 2020, DIFC employers have paid into the DIFC Employee Workplace Savings plan instead of building up a lump sum gratuity, contributing 5.83 percent of basic salary for staff under five years of service and 8.33 percent for those beyond five years, with no one year minimum service requirement. ADGM introduced a similar optional savings plan alongside its standard gratuity system starting in 2025.

Separately, MOHRE has introduced a voluntary Alternative End of Service Benefits system for mainland and free zone employers, generally known as the Savings Scheme. Employers who opt in for this program contribute monthly into a regulated investment fund instead of building a traditional lump sum. The contribution rates match the DIFC model, 5.83 percent under five years of service and 8.33 percent beyond that, and employees may add their own voluntary contributions up to 25 percent of total wage. Ask your HR department or payroll office whether your employment contract falls under this scheme, since it remains entirely optional for employers to adopt.

UAE Gratuity Calculation for Dubai, Abu Dhabi, Sharjah and All Emirates

The federal gratuity formula is identical everywhere in the country. Calculate gratuity UAE for a Dubai employee and you get the same result an Abu Dhabi employee would get for the same salary and service length. The only local differences come from your specific free zone authority or company policy, not the underlying law.

What Happens If Your Employer Refuses to Pay?

By law, your employer must settle your gratuity along with any outstanding wages within 14 days of your last working day, under Article 53 of the labour law. If that window passes with no payment, you have a clear path forward.

You generally have up to two years from the date your gratuity became due to file a claim, so do not assume a delay of a few months means you have lost your right to the money.

Keep copies of your employment contract, your salary slips, your settlement letter, and any resignation or termination letter before you leave your job. These documents are the evidence MOHRE and the labour court will ask for if your case needs to go further than a simple phone call to HR. Filing a genuine labour complaint does not put your visa at risk, and your employer cannot legally cancel your visa simply because you raised a dispute. Before your last day, it also helps to confirm your labour card cancellation timeline lines up with your settlement, since employers sometimes process both together.