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UAE gratuity calculator
Work out your UAE end-of-service gratuity under Federal Decree-Law No. 33 of 2021 — and what it's actually worth to do with the money once you have it, if you're sending it back to India.
| Total years of service | – |
| Daily wage (basic ÷ 30) | – |
| First 5 years (21 days/year) | – |
| Years beyond 5 (30 days/year) | – |
| 2-year salary cap applied? | – |
How UAE gratuity is actually calculated
End-of-service gratuity in the UAE is a statutory entitlement under Article 51 of Federal Decree-Law No. 33 of 2021, in force since 2 February 2022 and enforced by the Ministry of Human Resources and Emiratisation (MOHRE). One correction worth making upfront: a lot of content still online describes a resignation penalty — one-third or two-thirds of gratuity if you resigned before five years — from the old "unlimited contract" system. That penalty no longer exists. Since the 2022 reform, resignation and termination produce the same gratuity figure, as long as you've completed a year of service.
The actual calculation:
- Work out your daily wage. Article 67 treats a calendar month as 30 days, so your daily wage is your basic monthly salary divided by 30. Some employers use an annualised method instead (salary × 12 ÷ 365), which gives a slightly different figure — the law doesn't mandate one method, so it's worth checking which your employer applies.
- Apply the tiered rate. 21 days' wage for each of your first five years of service, then 30 days' wage per year after that.
- Check the cap. Total gratuity cannot exceed two years' (24 months') total salary, however long you've worked.
As with the other Gulf countries, this is based on your basic salary — housing, transport, commission, and other allowances are excluded, and employers can't legally inflate allowances to shrink the basic figure and reduce what they owe.
The full formula, step by step
First five years of service
First 5 years gratuity = daily wage × 21 × years (up to 5)Years beyond the first five
Exceeding-years gratuity = daily wage × 30 × years beyond 5Prorating a partial year
A partial year beyond your last full year is prorated at whichever rate applies at that point in your service — for example, 6 years and 4 months is calculated as 6.33 years, with the final 0.33 counted at the beyond-5-years rate.
The two-year cap
However long you've served and however high your salary, total gratuity cannot exceed the equivalent of two years' total salary. This is a hard ceiling under the law, not a guideline.
Resignation vs termination
As of the 2022 reform, these produce the same gratuity figure. The calculation doesn't care how the job ended, only that you completed one year of continuous service. The one exception is dismissal for gross misconduct under Article 44, which can cancel gratuity entitlement entirely — a specific legal scenario worth confirming directly with MOHRE rather than relying on any calculator.
Already know your years of service? Quick check
| Daily wage (basic ÷ 30) | – |
| First 5 years (21 days/year) | – |
| Years beyond 5 (30 days/year) | – |
| 2-year salary cap applied? | – |
Special cases the standard formula doesn't cover
DIFC and ADGM (financial free zones)
If you work in Dubai's DIFC or Abu Dhabi's ADGM, you're outside Federal Decree-Law No. 33 of 2021 entirely — these zones run their own employment frameworks. DIFC specifically replaced lump-sum gratuity with DEWS, a funded workplace savings plan employers contribute to monthly rather than paying out at the end. If this is you, the calculators on this page don't apply — check your DIFC or ADGM employment terms directly.
Domestic workers
Domestic workers are covered by separate regulations, not Federal Decree-Law No. 33 of 2021. Confirm your specific entitlement directly with MOHRE.
Government and civil service employees
If you're employed directly by a UAE government body, your end-of-service terms follow separate rules, not this Labour Law. This page doesn't apply to you.
What to actually do with your gratuity
If you're an Indian professional in the UAE, your gratuity payout is often one of the largest single sums you'll receive during your time there — what you do with it in the weeks after matters more than most people plan for.
- The UAE has no personal income tax, so your gratuity isn't taxed there. Whether you need to declare it in India depends on your residency status — worth checking with a tax advisor if the amount is significant.
- How you send it to India changes what you keep. Bank transfer, exchange houses, and remittance apps all quote different rates for the same amount — for a large one-off transfer, the gap between the best and worst option is often real money.
- If you're not spending it immediately, an NRE or FCNR deposit account is a common option for returning or long-staying NRIs to look into before parking it in a regular savings account.
[Internal link placeholder: point this paragraph to your "Best Way to Send Money to India" guide once published, and to an NRE/NRO explainer if you write one.]
Official UAE resources to verify your entitlement
A calculator gives you an estimate — for anything contested, disputed, or unusually large, verify directly with the ministry that actually enforces this law.
- Ministry of Human Resources and Emiratisation (MOHRE) — official website, for labor complaints and verified guidance on your specific case.
- u.ae — the UAE's official government portal, for wider government services beyond labor matters.
From around indianinQ8:
- Kuwait indemnity calculator, Saudi Arabia gratuity calculator, Qatar gratuity calculator, Bahrain gratuity calculator, and Oman gratuity calculator — if you're weighing offers across the Gulf, see how the rules genuinely differ country to country.
- More guides for Indians in the Gulf on iiQ8.
Frequently asked questions
How much gratuity will I get in the UAE?
21 days' basic salary per year for your first 5 years, then 30 days' basic salary per year after that, capped at two years' total salary. Use either calculator on this page for your specific numbers.
Do I get less gratuity if I resign instead of being terminated?
No, not anymore. Under Federal Decree-Law No. 33 of 2021, in force since February 2022, resignation and termination produce the same gratuity figure, as long as you've completed a year of service. Older articles describing a resignation penalty are referring to the previous law, which no longer applies.
What if I've worked less than a year?
Generally, there's no statutory gratuity entitlement under a year of continuous service.
Is gratuity calculated on my basic salary or my total package?
Basic salary only. Housing, transport, commission, and other allowances are excluded, and employers can't legally structure your pay to shrink the basic figure and reduce what they owe.
Is there a maximum limit on UAE gratuity?
Yes. Total gratuity cannot exceed two years' (24 months') total salary, regardless of how long you've worked.
Can I lose my gratuity entirely?
Possibly, if you're dismissed for gross misconduct under Article 44 of the Labour Law. That's a specific legal scenario a general calculator shouldn't estimate — get direct guidance from MOHRE if you believe this applies to you.
I work in DIFC or a Dubai free zone — does this apply to me?
If you work in a general free zone (JAFZA, DMCC, DAFZA, and similar), federal labour law generally still applies. But DIFC and ADGM specifically run their own separate employment frameworks — DIFC in particular replaced gratuity with DEWS, a funded workplace savings plan, not a lump-sum payout. This page's calculators don't apply if you're in DIFC or ADGM.
Does this apply to domestic workers?
No. Domestic workers are covered by separate regulations, not Federal Decree-Law No. 33 of 2021.
Is my UAE gratuity taxed?
The UAE has no personal income tax, so gratuity isn't taxed there. Whether it needs to be declared in India depends on your residency status — check with a tax advisor if the amount is significant.
How is this different from Kuwait, Saudi Arabia, and Qatar's rules?
The UAE's tiered daily-wage formula (21 then 30 days) is closest to Kuwait's structure, but with a higher cap (2 years' salary vs Kuwait's 18 months) and, since 2022, no resignation penalty at all — closer to Qatar's approach than Kuwait's or Saudi's, even though the day-count formula itself resembles Kuwait's more than Qatar's flat rate.