Country guide · UAE · AED
A UAE offer, checked properly
The UAE pays no income tax and its gratuity rules were rewritten in 2022 to be fairer to leavers — but the formula is tiered, capped, and different again if your employer sits in a free zone. Here is what the numbers need to include.
Open the calculator set up for the UAE →
End-of-service gratuity: tiered, capped at two years
Under Federal Decree-Law No. 33 of 2021, Article 51 (in force since 2 February 2022), you earn 21 calendar days' basic salary per year for years one to five, then 30 days per year from year six onward — daily wage is monthly basic ÷ 30. The total is capped at two years' basic salary. Under one year of service, you get nothing; partial years are pro-rated.
The 2022 reform's biggest change: the old penalty that cut your gratuity by a third or two-thirds for resigning early is abolished. Resignation and termination are now treated the same after one year — the only way to forfeit it is Article 44 dismissal for gross misconduct.
Worked example: AED 20,000 basic, 7 years, on a mainland contract — 5 years × 21 days + 2 years × 30 days = 165 days' pay ≈ AED 110,000 (well under the 2-year, AED 480,000 cap). The calculator runs this from your own figures.
Rules verified August 2026 · official sources — MOHRE
What UAE living costs look like
Typical monthly figures for a family in Dubai or Abu Dhabi — the same defaults the calculator loads when you pick the UAE, editable to your own situation:
| Cost | Typical monthly (AED) |
|---|---|
| Rent (family apartment/villa) | 12,600 |
| Utilities — DEWA/water, cooling, internet | 1,790 |
| School fees, per child (÷12) | 5,250 |
| Groceries and household | 4,200 |
| Car, fuel, insurance | 6,830 |
The UAE specifics worth knowing
Rent is up front, not monthly. One to four cheques covers a full year, dated at signing, plus a deposit of roughly 5% of the annual rent unfurnished or 10% furnished. That is a far larger single cash requirement on arrival than Qatar's monthly-cheque market — size your arrival float accordingly.
Free zones change the deal. DIFC and ADGM employers use their own end-of-service savings schemes instead of Article 51 — often paid monthly into an investment plan rather than accrued as a lump sum. Confirm which regime you are actually on before budgeting around either formula.
No income tax, but the arrival float is real — the up-front rent cheque alone can be a bigger single payment than anywhere else in the region. The calculator's one-off section sizes this and shows your break-even month.
Questions people ask about UAE packages
Is UAE gratuity capped?
Yes — at two years' basic salary, however long you stay. Long service on a high basic still builds a large exit sum, but it does not grow forever the way Qatar's uncapped formula does.
Does resigning cost me my gratuity?
Not since the 2022 reform. Resignation and termination are treated identically after one year of service — the old reduction for early resignation no longer applies.
What does a typical package include?
Basic plus housing and transport allowances, annual flights, medical cover, and for families an education allowance — usually per child and capped. Compare offers on the whole package, never on basic alone.
How do I check my employer or my rights?
MOHRE (mainland) and the u.ae portal are the official sources; DIFC and ADGM employees should check their free zone's own employment regulations instead.
Other countries: Qatar · Saudi Arabia · Kuwait · Bahrain · Oman — or read the first 90 days in Doha.