Working in the UAE and wondering how much gratuity you may receive when leaving your job? Our UAE Gratuity Calculator helps you estimate your end-of-service benefit based on your basic salary and employment duration under UAE labor law. Simply enter your monthly basic salary, joining date, and last working day to calculate your estimated gratuity instantly. This calculator is especially designed to help Nepalese and other expats in the UAE better understand how gratuity is calculated and what factors affect the final amount.

What is Gratuity in UAE?

Gratuity is an end-of-service benefit provided by employers to employees in the UAE after completing a certain period of employment. It is considered a financial reward for the employee’s service and is governed by the UAE Labour Law.

In most cases, employees become eligible for gratuity after completing at least one year of continuous service with the company.

Is UAE Gratuity Calculated on Total Salary or Basic Salary?

One of the biggest misunderstandings among employees in the UAE is related to how gratuity is calculated.

UAE gratuity is generally calculated based on the employee’s basic salary only, not the total salary package.

This means allowances such as:

• Housing allowance
• Transport allowance
• Food allowance
• Other benefits

are usually not included in gratuity calculations.

That is why many employees are surprised when their final gratuity amount becomes lower than expected.

UAE Gratuity Rules Explained

The gratuity amount mainly depends on:

• Your basic salary
• Your total years of service
• Your employment contract
• UAE labour law eligibility

If You Worked Less Than 1 Year

Employees who worked for less than one year are generally not eligible for gratuity.

If You Worked Between 1 and 5 Years

Employees receive gratuity equal to:

• 21 days of basic salary for each year of service.

If You Worked More Than 5 Years

Employees receive:

• 21 days of basic salary for the first 5 years
• 30 days of basic salary for each additional year after 5 years.

Simple UAE Gratuity Calculation Example

Let’s say:

• Monthly basic salary = AED 5,000
• Service period = 6 years

In this case:

• First 5 years are calculated at 21 days per year
• The remaining 1 year is calculated at 30 days

The estimated gratuity would be approximately AED 22,500.

Why Do Some Employees Receive Lower Gratuity?

In many UAE companies, the salary structure is designed with:

• Lower basic salary
• Higher allowances

Since gratuity is based mainly on basic salary, employees with lower basic salaries often receive lower gratuity amounts even if their total salary is high.

That is why it is very important to understand your salary structure before accepting a job offer in the UAE.

Important Things to Check Before Signing a UAE Job Offer

Before joining a company in the UAE, always check:

• Your basic salary amount
• Contract type
• Benefits and allowances
• Leave policy
• End-of-service benefits

Many employees focus only on total salary and ignore the basic salary, which directly affects gratuity calculations.

Frequently Asked Questions (FAQs)

Can I get gratuity if I resign?

Yes, in many cases employees are eligible for gratuity even after resignation, depending on the service duration and employment terms.

Is gratuity taxable in UAE?

Currently, UAE gratuity is generally tax-free for employees.

Does unpaid leave affect gratuity?

Certain unpaid leaves may affect the final gratuity calculation depending on company policy and labour law interpretation.

Is gratuity mandatory in UAE?

Yes, eligible employees in the private sector are generally entitled to end-of-service benefits under UAE Labour Law.

Final Thoughts

Understanding gratuity is extremely important for every employee working in the UAE. Your gratuity can become a significant financial support when changing jobs or returning home after years of employment.

Use the UAE Gratuity Calculator above to estimate your gratuity amount and better understand your employment benefits in the UAE.