UAE Gratuity Calculator Explained - Step by Step

A UAE gratuity calculator starts with basic salary. This is important because allowances such as housing, transport, meals, phone, bonus, or commission are normally not included in the standard gratuity base. The calculator converts monthly basic salary into a daily rate by dividing it by 30. It then applies the service-year formula.

For eligible service, the first five completed years are commonly calculated at 21 days of basic wage per year. Service beyond five years is calculated at 30 days of basic wage per year. If the employee worked part of a final year, the calculator prorates that period. If the total would exceed the statutory ceiling, the gratuity is capped at two years of basic salary.

The result is an estimate, not a legal ruling. Contracts, free-zone rules, savings plans, settlement agreements, and disputed termination facts can change the final amount. Employees should compare the calculator output with the employer settlement statement and ask for a written breakdown of basic salary, dates used, service days, and any deductions before signing final documents.