Gratuities are payable as an end-of-service benefit for employees working in the private sector in the UAE. This financial award, calculated based on years of service and type of contract, ensures that employees are fairly compensated when they leave their employment.
To calculate this gratuity, our free UAE Gratuity Calculator helps you easily calculate the benefits employees receive at the end of their service under both limited and unlimited contracts. Updated with the latest MOHRE guidelines, this calculator provides an accurate estimate of your gratuity based on your salary, years of service and type of contract. This calculator is complex and generates the amount and PDF slip for you in a matter of seconds.
Gratuity Calculator UAE
Calculate your end-of-service gratuity based on UAE Federal Labour Law No. 33 of 2021.
Gratuity Calculation
Based on UAE Federal Labour Law No. 33 of 2021
| Period From | Period To | Days | Gratuity (AED) |
|---|---|---|---|
| Total Gratuity | |||
Disclaimer: Dubai Development Authority (DDA) Free Zone is governed by the Dubai Technology and Media Free Zone Employment Regulations 2004 and U.A.E. Federal Labour Law No. (33) OF 2021 and its Amendments. DDA has prepared an electronic form of Gratuity Calculator for sample calculation basis to Licensees and their employees in respect to their employment matters. The information and details contained herein are based on the minimum terms and conditions prescribed in the UAE Labour Law, and any outcome resulting from the use of the Gratuity Calculator should not be construed as final and binding. They are meant to serve merely as guidance and consequently have no legal merit. DDA is not responsible for any errors or omissions, or the results obtained from the use of this information and DDA make no representations, warranties or guarantees, whether express or implied that the information and content is accurate, complete and up-to-date. They can also be subject to amendments from time to time.
Gratuity Calculation Formula for Limited Contract (2025)
Under a limited contract, the UAE Labor Law stipulates gratuity as follows:
- If the employee completes 1 to 5 years of service:
Gratuity = 21 days' basic salary × number of years worked - If the employee completes more than 5 years:
Gratuity = (21 days × 5) + (30 days × number of years after 5 years)
Note: Gratuity should not exceed two years' worth of basic salary.
Formula Example:
If your basic salary = AED 5,000
Service Duration = 6 years
Then:
Gratuity = (21 × 5,000 / 30 × 5) + (30 × 5,000 / 30 × 1)
= AED 17,500 + AED 5,000 = AED 22,500
Gratuity Calculation Formula for Unlimited Contract (2025)
Under an unlimited contract, gratuity depends on termination type and years of service.
- If the employee resigns:
- Less than 1 year: No gratuity
- 1–3 years: ⅓ of 21 days’ salary × years
- 3–5 years: ⅔ of 21 days’ salary × years
- More than 5 years: Full 21 days for first 5 years + 30 days thereafter
- If the employer terminates:
Full gratuity applies same as limited contract (21/30 days rule)
Formula Example (Resignation after 4 years):
Basic Salary = AED 4,000
Gratuity = ⅔ × (21 × 4,000 / 30 × 4)
= ⅔ × AED 11,200 = AED 7,466.67
FAQ on Gratuity Calculator UAE
Q1. What is gratuity in UAE?
Gratuity is an end-of-service benefit paid to employees after completing at least one year of continuous service in the UAE.
Q2. Is gratuity calculated on gross or basic salary?
Gratuity is calculated based only on the basic salary, excluding allowances and bonuses.
Q3. Who is eligible for gratuity in UAE?
Employees who have completed at least 1 year of continuous service are eligible under both limited and unlimited contracts.
Q4. What happens if I resign before completing 1 year?
You will not be eligible for gratuity if your service is less than 1 year.
Q5. Is the gratuity taxable in UAE?
No, gratuity is not taxable in the UAE.
Q6. Can my employer deduct any amount from gratuity?
Only in specific legal cases such as disciplinary action or if the employee owes dues to the employer.
