Gratuity Calculator UAE 2025: MOHRE End-of-Service Guide & Free Tool
Enter your basic salary, employment dates, and other details to calculate your UAE end-of-service gratuity for 2025.
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Guide to Use Gratuity Calculator UAE
Working as an expat in Dubai, Abu Dhabi, or Sharjah? You’ve probably wondered how much you’ll receive when your job ends. The math behind end-of-service benefits (EOSB) can feel confusing — that’s why our free gratuity calculator UAE, aligned with the UAE’s Ministry of Human Resources and Emiratisation (MOHRE) regulations, makes gratuity calculation easy and shows exactly how to calculate gratuity in UAE with confidence.
This end-of-service calculator follows MOHRE rules and UAE Labour Law (Article 51). It uses your basic salary only and fairly prorates service years. For mainland employees, the gratuity calculator UAE uses your basic salary to compute the daily wage. It also calculates service duration automatically from the start and end dates, ensuring accurate EOSB as per MOHRE rules.
- Part-time workers: precise pro-rating by % of full-time hours.
- Legacy rules (before 02-Feb-2022): resignation vs termination reductions applied automatically.
- Contract type aware: limited vs (legacy) unlimited handling where relevant.
- Unpaid leave: excludes unpaid-absence days from service length.
- Any wage type: monthly / weekly / daily — with correct daily conversion.
- Two-year statutory cap: applied automatically and clearly flagged.
- Transparent math: narration + formula with your actual values.
What is Gratuity?
In Arabic gratuity is called “مكافأة نهاية الخدمة” (gratuity meaning in Dubai & UAE) — a legally mandated lump-sum payment given to employees at the end of their service, mandated by UAE Labour Law for private-sector employees who complete at least one year of continuous service. It’s based on your basic salary and years of service, rewarding long-term commitment.
For a deeper look into special cases like legacy contracts, maternity leave, and part-time shifts, explore our detailed guide on UAE Gratuity Special Cases for accurate gratuity calculation in non-standard situations. Confused about gratuity in cases of shutdown, absconding or suspension? Our Company Shutdown, Absconding & Suspension Gratuity Guide explains it with MOHRE references.
Most employees in the UAE follow the standard MOHRE gratuity calculation rules described below.
How to Use the Gratuity Calculator UAE for Precise Gratuity Calculation
If you’re wondering how to do gratuity calculation accurately, this section will guide you step by step. Start with our quick video tutorial below for a simple walkthrough.
🎥 Watch: Gratuity Calculator Tutorial
Prefer reading? Follow the detailed instructions for using gratuity calculator UAE:
- Enter Basic Salary
Use only your basic salary, excluding extras like housing or transport allowances. For example, if your monthly pay is AED 12,000 but your basic salary is AED 7,000, input AED 7,000. Including bonuses is a common mistake for expats. - Input Service Dates
Gratuity depends on exact start and end dates. Check your contract or emails for accuracy. Our online gratuity calculator UAE prorates partial years automatically (e.g., 3.7 years). You can rely on our free gratuity calculator UAE to process fractional years accurately — no complex spreadsheet needed.
Example: Aisha, a Sharjah teacher with an AED 10,000 basic salary, worked 4 years. Using our tool, she found she’d get AED 28,000—perfect for her savings! - Select Contract Type and Exit Reason
Choose between a limited (fixed-term, up to 4 years) or unlimited contract. For pre-2022, unlimited contracts, resignation reduces gratuity, while termination grants the full amount after one year. Since February 2022, all contracts have been fixed-term in the UAE as per the MOHRE. - Account for Unpaid Leave
Unpaid leave, like sabbaticals, doesn’t count toward service years. Verify your records to ensure accurate results.
Free Zone Gratuity
If you work in a Free Zone such as Hamriyah Free Zone, ADGM, JAFZA, DMCC, Saif Zone or RAKEZ, our separate Free Zone Gratuity Calculator provides accurate gratuity calculation tailored to each zone’s specific rules. For example, ADGM does not impose a cap on the basic salary when calculating end-of-service benefits.
For DIFC employees, end-of-service benefits are regulated differently under DIFC’s unique DEWS system. Because this model is based on employer contributions, voluntary savings, and investment performance, it cannot be calculated using a standard gratuity formula like other Free Zones. Please consult your employer or scheme manager for your exact entitlement. For a detailed breakdown of contribution rates, legacy balances, and top-up rules, see our DIFC DEWS gratuity guide.
For a comprehensive overview of Free Zone gratuity rules, including ADGM’s no-cap formula, DMCC and DIFC’s DEWS model, refer to our detailed 2025 Guide to Free Zone Gratuity. Free zone employees in JAFZA can also check our specific JAFZA gratuity guide for tailored rules.
Gratuity Computation – Mainland (Private Sector)
Under UAE Labour Law, gratuity on the mainland follows MOHRE’s rules. The entitlement varies depending on whether the employee is under a limited contract (post-2022) or an older unlimited contract (pre-2022). The sections below explain both cases with formulas and examples.
Limited Contracts
Since February 2, 2022, all employment contracts in the UAE have been converted to fixed-term agreements, replacing the older unlimited model. Under this law, employees are entitled to full gratuity regardless of whether they resign or are terminated, and employers must settle the payment within 14 days of the last working day.
To ensure fairness and consistency, the MOHRE has provided the following clear gratuity calculation formula, allowing both workers and employers to determine benefits accurately:
| Service duration | Entitlement | How it’s calculated |
|---|---|---|
| 1–5 years | 21 days per year | (Basic × 21 × Years) ÷ 30 |
| More than 5 years | 30 days per year (beyond 5) | (Basic × 21 × 5) ÷ 30 + (Basic × 30 × Years over 5) ÷ 30 |
| Overall cap (UAE Labour Law) | Max two years’ basic pay | If total exceeds the cap, the cap amount applies |
Example – Limited contract: Radhika, a Dubai marketing manager, earned AED 10,000 monthly for 6 years. For the first 5 years, she received AED 35,000 (7,000 × 5 years × 21 ÷ 30). In the 6th year, she received AED 10,000 (30 days). Total = AED 45,000.
Even a few extra months of service can significantly increase UAE gratuity payouts, especially with salaries around AED 10,000.
Maximum gratuity in UAE: A statutory cap applies — the total end-of-service benefit cannot exceed two years’ basic salary. If the calculated total is higher, the cap amount applies.
If you’re looking for a domestic worker gratuity calculator MOHRE, note that unlike the standard UAE Labour Law formula, domestic workers fall under Federal Decree-Law No. 9 of 2022, and the law does not publish a fixed formula for UAE domestic worker gratuity. Employers must settle compensation within 10 days, in accordance with the law’s executive rules, current MOHRE guidance, and the worker’s contract.
Structure (for understanding, not an official formula):
- Daily basic wage = monthly basic ÷ 30
- Annual entitlement = days per year set in your contract/guidance
- Estimated EOS = daily basic wage × annual entitlement × years of service
Note: Partial years may be prorated where applicable; always rely on the official output.
Tip: Searching for “domestic worker gratuity UAE”? Read our full Domestic Worker Gratuity Guide for worked examples and eligibility rules.
Legacy (Pre-2022) Unlimited Contracts
If you’re under a legacy contract, this section explains how to calculate gratuity in UAE for unlimited contract — our Dubai gratuity calculator unlimited contract handles it automatically. Under pre-2022 unlimited contracts, resignation gratuity may be reduced per Articles 137/138, while termination gratuity generally follows Article 132. Always check notice period obligations (Article 43) and misconduct provisions (Article 120). For older unlimited contracts, payouts vary:
| Case | Years of Service | Entitlement | Formula |
|---|---|---|---|
| Resignation | 1–3 years | ⅓ of 21 days per year | ((Basic ÷ 30) × 21 × Years) × 1/3 |
| 3–5 years | ⅔ of 21 days per year | ((Basic ÷ 30) × 21 × Years) × 2/3 |
|
| Above 5 years | Full gratuity (21 days up to 5 yrs, then 30 days) | ((Basic ÷ 30) × 21 × 5) + ((Basic ÷ 30) × 30 × (Years - 5)) |
|
| Termination | 1–5 years | 21 days per year | (Basic ÷ 30) × 21 × Years |
| Above 5 years | Full gratuity (21 days up to 5 yrs, then 30 days) | ((Basic ÷ 30) × 21 × 5) + ((Basic ÷ 30) × 30 × (Years - 5)) |
|
| Overall Cap | Maximum 2 years’ basic wage | If total exceeds cap → apply cap | |
Note: Under UAE Labour Law (Federal Decree-Law No. 33 of 2021), gratuity is subject to a statutory cap of two years’ basic salary. Use the gratuity calculator UAE above to verify your entitlement if you have an older unlimited contract.
Example – Unlimited Contract: If you resign after 2 years with a basic salary of AED 6,500:
- Daily wage = AED 6,500 ÷ 30 = ~AED 217
- Gratuity = 217 × 21 × 2/3 = ~AED 3,038
Employers may also deduct approved loans or advances before paying EOSB, as allowed under Article 135 of the UAE Labour Law. These deductions are typically addressed in the full and final settlement process. Full and Final Settlement (FFS) typically includes unpaid salary, leave encashment, gratuity (EOSB), and any approved deductions. This ensures all financial dues between employer and employee are cleared at the end of service.
Tax Implications of Gratuity
Gratuity is tax-free in the UAE, allowing expats to retain their full end-of-service benefits. However, repatriating your payout to your home country may trigger local taxes, as some nations treat lump-sum payments as taxable income. For example, countries like India or the UK may apply income tax based on residency status. Speak with a financial advisor to fully understand your responsibilities and plan accordingly.
Gratuity Disputes: How to Resolve Them
Under Article 51 of Federal Decree-Law No. 33 (2021), expatriates in the private sector have the right to receive their gratuity payment within 14 days after their employment ends. Delays may result in MOHRE fines.
If your end-of-service benefits are delayed or disputed, first contact HR with your contract and records. If unresolved, file a complaint via MOHRE (800 60 or portal). MOHRE resolves most labour disputes quickly, especially gratuity claims below AED 50,000.
For complex cases, consult a labour lawyer or refer to our Gratuity Dispute Resolution Guide.
Can Gratuity Be Denied?
You might lose gratuity if:
- You quit without serving notice (unless the employer breached terms).
- You’re fired for misconduct (e.g., theft).
- You leave before one year.
Common Mistakes to Avoid
You need to avoid the following while using gratuity calculator UAE:
- Wrong Salary Input: Confusing gross salary vs basic salary, use only basic salary for gratuity calculation, not total pay.
- Incorrect Dates: Double-check start/end dates.
- Ignoring Contract Type: Limited or unlimited contracts? it can affect end-of-service benefits.
- Unpaid Leave Errors: Exclude sabbaticals from service years.
- Forgetting contract renewals count toward total service years.
The legal basis for gratuity, contracts, and leave comes from the UAE Labour Law 2025 guide
Secure Your End-of-Service Benefits
- Review Your Contract: Check salary, notice period, and terms.
- Know Your Rights: Read MoHRE’s guidelines
- Keep Records: Store contracts, payslips, and attendance records.
- Discuss with Employer: If disputes arise, send a polite email like following sample draft:
Dear [HR Manager],
I’ve worked 4 years and want to confirm my gratuity per UAE labour law. Can we discuss next steps?
Regards, [Your Name]
If issues persist, contact MOHRE or a lawyer
Eligibility Checklist for Gratuity in UAE(2025)
- Gratuity eligibility days/ period — you must complete at least one full year of continuous service to qualify as per UAE labour law, Article 51.
- Expat in private sector (not UAE national).
- Limited (post-2022) or unlimited (pre-2022) contract.
- No misconduct termination or resignation without notice.
- Part-time: 1+ year, pro-rated salary.
- If someone passes away or gets disabled from work, gratuity is paid in full. The employer has 10 days to pay the employee/ legal heirs after the paperwork is sorted. Work-injury compensation is addressed in detail in Article 37.
Estimate your payout in seconds with our trusted gratuity calculator UAE.
Alternative End-of-Service Savings Scheme
The alternative End-of-Service Benefits System is a voluntary scheme that allows expatriates to invest their end-of-service benefits in Emirates Securities and Commodities Authority (ESCA) approved funds with a proven track record of solid returns. If you’re conducting a settlement estimation, it’s worth considering this option. Details on these alternative End-of-Service Benefits investment choices, including contact information, registration process, and withdrawal procedures, can be found on the official on the MOHRE official website.
For practical strategies on where and how to grow your end-of-service benefits, check out our upcoming guide on gratuity investment in UAE—featuring top smart investment options in the UAE tailored for expats.
Gratuity vs Tip (UAE)
- Gratuity: Legal end-of-service entitlement (EOSB) under UAE Labour Law; paid by the employer.
- Tip: Voluntary payment from customers for service; not part of EOSB; not governed by Articles 51/132/137/etc.
- Calculator scope: This gratuity calculator UAE estimates EOSB only — tips are excluded.
Benefits of Using Our Gratuity Tool
Free to use
Our online end-of-service calculator is completely free. Use it anytime!
Partial Year
Gratuity calculator UAE adjusts fractional period like 3.7 years to provide precise results.
Labour Law
The end-of-service calculator follows 2025 UAE gratuity rules & updates.
Easy to use
Employees can use it independently with ease.
Then what are you waiting for? Let our free online end-of-service calculator help you forecast your gratuity calculation UAE confidently.
Frequently Asked Questions (FAQs)
Final Thoughts on Gratuity Calculation
Calculating your end-of-service benefits doesn’t have to be a hassle. Our gratuity calculator UAE simplifies the process for expats wondering how to calculate gratuity in UAE. With clear gratuity formulas, updated 2025 labour rules, and well-defined eligibility criteria, you can confidently complete your gratuity calculation and claim every dirham you’ve earned using our trusted gratuity calculator UAE.
Author Bio
Written by Noor Al Emarat — Editorial Team at Gratuity Calculator UAE. The team focuses on accurate, practical guidance covering gratuity calculations, HR processes, and UAE labour law. Every article is carefully reviewed to help both employees and employers understand end-of-service benefits and workplace rights with confidence.