UAE Gratuity Calculator: End of Service Updated Guide 2025

The UAE gratuity calculator is an online tool for calculating the end-of-service bonus an ex-employee is entitled to. If you are looking for how to calculate your gratuity in the UAE, then this article will guide you through the process. Use our UAE gratuity calculator to evaluate your severance pay and learn the guidelines surrounding gratuity calculation in the UAE, the eligibility criteria, and other necessary information you should know. 

UAE Gratuity Calculator

What is Gratuity in the UAE?

In the UAE, gratuity, also known as end-of-service benefit, is a payment that employers are legally required to provide to eligible employees upon the termination of their employment. This payment is only available to expatriate workers with at least one year of continuous service to a particular employer. The gratuity sum largely depends on two key factors: the length of the service period and the employee’s basic salary. However, the maximum amount any employee can receive as gratuity in the UAE is capped at two years’ worth of basic salary.

How to Use UAE Gratuity Calculator

To calculate your gratuity using our UAE gratuity calculator, follow these steps: 

• Navigate to the UAE gratuity calculator.
• Enter your last basic drawn salary in the provided space. Input only digits with no commas or currency. 
• Enter the day you officially started work according to your work contract. 
• Enter the day you officially ended work according to your work contract or termination documents.
• Select the type of your work contract. Currently, the UAE no longer allows unlimited work contracts. 
• Select a reason for exit in the provided area.
• Click “Calculate Gratuity”.

View your full gratuity amount, including the tenure of your work service. 

How to Calculate Gratuity in the UAE

If you are wondering how gratuity is calculated in the UAE, this section will guide you through the steps involved. Follow the procedures below to accurately calculate your gratuity in the UAE:

• Calculate your daily pay: Divide your monthly basic salary by 30. For example, in the case where your basic salary is AED 15,000, divide it by 30 to find your daily salary. So daily salary = AED 15,000 / 30 = AED 500 per day.
• Calculate for your first 1 to 5 years: For each year you worked within this period, multiply your daily wage by 21 days.
  • Formula: (Daily Wage × 21) × Number of Years (within 1-5) = Gratuity for first 5 years.
• Calculate for years beyond first 5 years: For every year you worked after the initial five years, multiply your daily wage by 30 days.
  • Formula: (Daily Wage × 30) × Number of Additional Years = Gratuity for years beyond 5.
• Calculate for partial years: For any remaining months or days in the work period, count the calendar days between the day you completed your last full year of service and your last day of employment to find days in the partial year. 
  • Formula for additional partial years within 5 years: (Daily wage × 21) ÷ 36 × Days in the Partial Years.
  • Formula for additional partial years after 5 years: (Daily wage × 30) ÷ 36 × Days in the Partial Years
• Add it up: Your total gratuity is the sum of your gratuity for the first five years and gratuity for any additional years beyond the first five years.
  • Formula: Gratuity for first five years + Gratuity for additional years + Gratuity for partial years = Total Gratuity. If your total years of service are between 1 and 5, your overall gratuity will be the amount calculated just for that period.

Calculate Gratuity for Part-Time Employees in the UAE

For domestic workers in the UAE, here’s how to calculate your gratuity:

• Determine the employee’s work ratio: Figure out what percentage of a full-time role they work by dividing their actual hours by the standard full-time hours and multiplying by 100. 
  • Example: If full-time is 40 hours, and they work 20, the ratio is (20 ÷ 40) × 100 = 50%.

• Calculate the gratuity as if they were full-time: Do the normal gratuity calculations for a full-time employee. 
  • For the first 1 to 5 years of service, figure out the amount by multiplying their daily wage by 21 days, then by the number of years in this timeframe.
  • For any service after the first 5 years, multiply their daily wage by 30 days, then by the number of years worked past the five-year mark.
• Find the total full-time equivalent gratuity: Add the amounts calculated for the first 1–5 years and any years beyond 5.
• Calculate the actual part-time gratuity: Take the total full-time equivalent gratuity and multiply it by the employee’s work ratio (expressed as a decimal, so divide the percentage by 100).
  • Example: If the full-time amount was AED 50,000 and the ratio was 50%, the part-time gratuity is AED 50,000 × (50 ÷ 100) = AED 25,000.

UAE Gratuity Calculation Example

Here is a UAE gratuity calculation sample for an employee earning the basic monthly salary of AED 18,000 and worked from July 21, 2020, till August 11, 2025: 

• Determine the total service period: From July 21, 2020, to July 20, 2025, is exactly 5 full years. The remaining period is from July 21, 2025, to August 11, 2025. The number of calendar days between July 21, 2025, and August 11, 2025 is 22 days.
  • Total Service Period = 5 years and 22 days.
• Calculate the daily pay: Divide the monthly basic salary by 30.
  • Daily Wage = AED 18,000 ÷ 30 = AED 600.
• Calculate gratuity for the first 1 to 5 years: For each year worked within this period, multiply the daily wage by 21 days.
  • Formula: (Daily Wage × 21) × Number of Years (within 1-5) 
  • Gratuity for First Five Years: (AED 600 × 21) × 5 = AED 63,000.
• Calculate gratuity for partial year: The calendar days between the last day of a full year of service and the last day of employment are 22. So we do the following calculation:
  • Formula: (Daily wage × 21) ÷ 36 × Days in the Partial Years.
  • Gratuity for Partial Year = (AED 600 × 30) ÷ 36 × 22 = AED 11,000.
• Calculate total gratuity: Sum all the applicable gratuities. For our case study, the total gratuity will be the sum of Gratuity for First Five Years and Gratuity for Partial Year.
  • Formula: (Gratuity For First Five Years) + (Gratuity For Partial Year).
  • Total Gratuity: AED 63,000 + AED 11,000 = AED 74,000.

Eligibility Criteria for UAE Gratuity

To be eligible for gratuity in the UAE, the person must have fulfilled the following requirements: 

• Employee should be an expatriate.
• Employee must have completed at least one year of continuous service to the same employer.
• Employee must either be a full-time, part-time, or domestic worker.
• The reason for work exit should not be due to gross misconduct. 
• Citizens of the UAE are not eligible as they are covered under the national pension program.

Conclusion

Gratuity payment is a right for every eligible employee according to the UAE labour laws. Through our UAE gratuity calculator or the manual guidelines we have provided, you can now accurately calculate your UAE gratuity. Ensure you meet all the eligible requirements and terminate the work contract properly.