End of Service Gratuity Dubai 2026: Calculator & Guide

At a Glance

How Gratuity is Calculated

End-of-service gratuity is one of the most valuable aspects of UAE employment. Understanding exactly what you're owed ensures you leave Dubai with your full entitlement. The calculation depends on your contract type, years of service, and reason for leaving.

Service Duration	Daily Rate	Entitlement
Under 1 year	—	Not eligible
1-5 years	21 days/year	Full, pro-rated for the period served
5+ years	30 days/year for years beyond 5	Full, pro-rated for the period served

Under 1 year

01

Daily Rate—
EntitlementNot eligible

1-5 years

02

Daily Rate21 days/year
EntitlementFull, pro-rated for the period served

5+ years

03

Daily Rate30 days/year for years beyond 5
EntitlementFull, pro-rated for the period served

Key Points

Gratuity Maximization Tips

01

Timing Your Exit

If you're at 4.5 years, waiting to reach 5 years significantly increases your payout — the daily rate rises from 21 to 30 days/year for every year beyond 5, added on top of the first 5 years.

02

Basic Salary Definition

Gratuity is calculated on BASIC salary only — not housing allowance, transport, or other benefits. If your package is heavily loaded in allowances, negotiate higher basic before leaving.

03

Documentation

Keep all salary certificates, contract amendments, and pay slips. Disputes over basic salary amount are common. Documentation protects your claim.

04

Legal Recourse

If your employer doesn't pay within 14 days of your last working day, you can file a complaint with MOHRE. Processing times and outcomes vary by case — keep your documentation ready.

Scenario: Resignation after 7 years, AED 20,000 basic salary

Example Calculations

First 5 years: 21 days × 5 = 105 days. Next 2 years: 30 days × 2 = 60 days. Total: 165 days. Daily rate: 20,000 ÷ 30 = AED 667. Gratuity: 165 × 667 = AED 110,000 ($30,000). Resignation and termination receive the same amount under current UAE law.

Good to Know

Frequently Asked Questions

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Is gratuity taxed?

No. The UAE does not tax gratuity payments. However, your destination country may tax it as foreign income. Plan the timing of your tax residency transition accordingly.

Can I negotiate a higher exit package?

Yes. Many employers offer enhanced exit packages to retain goodwill, especially for senior employees. Negotiate based on notice period flexibility, project handover, and knowledge transfer value.

What if my company uses the new DEWS system?

The Difc Employee Workplace Savings plan replaced traditional gratuity for DIFC employees. Check your scheme balance directly. Withdrawals follow the plan's rules, not gratuity law.

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