If you work in the UAE private sector under the federal labour law (Federal Decree-Law No. 33 of 2021) and have completed at least one year of continuous service, your employer must generally pay your end of service gratuity within 14 days of your contract ending. It is based on your last basic wage, not your total package, and is capped at two years' wages. DIFC employees are covered by a different regime, where the benefit is generally built up in a workplace savings plan instead.

How the gratuity is calculated

Under Article 51 of the federal law, a full-time foreign employee with at least a year of continuous service is entitled to:

  • 21 days' basic wage for each of the first five years of service
  • 30 days' basic wage for each year after that

Part years are counted pro rata once the first year has been completed. The total cannot exceed two years' wages. Your employer can deduct amounts payable under the law or a court judgment. Part-time workers have their own provisions.

Because the calculation uses your last basic wage, allowances such as housing and transport are generally excluded. Check your contract and payslips to see how your package is split.

When it is paid

Article 53 requires your employer to pay your wages and all other entitlements within 14 days of the contract ending. Getting written confirmation of the amount and how it was calculated before your last day can make any disagreement easier to resolve.

Some employers may have joined a voluntary federal savings scheme introduced as an alternative to the gratuity, where contributions are invested during employment. If your employer uses it, your benefit may be held in that scheme rather than paid as a single sum by the employer. Check with your employer which applies.

DIFC employees: DEWS

Since 1 February 2020, DIFC employers have generally been required to pay into the DIFC Employee Workplace Savings plan (DEWS) or another qualifying scheme instead of accruing a gratuity. The minimum employer contributions announced by the government are 5.83% of basic monthly wage for the first five years of service and 8.33% after that. Gratuity built up before February 2020 may be dealt with separately, so confirm in writing how yours is held.

When you leave, the plan generally allows you to stay invested or to take a partial or full withdrawal, subject to the plan rules.

What to think about before moving the money

A gratuity is often the largest single sum an expat receives on leaving. Points to weigh:

  • Timing and UK residence. The UK tax position of a payment received after you become UK resident again depends on your circumstances, including the split-year rules. If you are already back, take advice before assuming it is outside UK tax.
  • Purpose. Decide whether it is for a home deposit, an emergency fund, school fees, or long-term savings before choosing where it goes.
  • Currency. Dirhams are pegged to the dollar. If you are heading to the UK or Europe, think about when to convert.
  • Next country's rules. The UK's four-year foreign income and gains regime for people returning after 10 or more consecutive non-resident tax years does not cover foreign employment income, so it should not be assumed to relieve a gratuity. Spain, Portugal and Australia each have their own rules.

Illustrative example only, not a real client. David leaves a Dubai mainland employer after exactly 8 years on a basic salary of AED 30,000 a month. Assuming a daily basic wage of annual basic salary divided by 365 (AED 360,000 / 365 = about AED 986.30), he is due 21 days for each of the first 5 years (105 days) plus 30 days for each of the next 3 (90 days), so 195 days, about AED 192,329. If his employer used a 30-day month instead (AED 1,000 a day), the figure would be AED 195,000. Either way it is well below the two-year cap of AED 720,000. Employers may calculate the daily rate differently, so the exact figure should be checked.

For more on deploying a lump sum, see our guide to investing a lump sum as a British expat, and if you are moving home our guide to returning to the UK after living abroad.

Common mistakes

  • Assuming gratuity is based on total salary rather than basic salary.
  • Not checking the calculation before the final working day.
  • Leaving DEWS savings unreviewed after moving abroad.
  • Assuming the UK foreign income and gains regime covers a gratuity.

A regulated financial adviser can help. Get in touch for a free introduction.

Sources and further reading

Last reviewed: October 2026. Tax year: 2026/27 (UK); UAE and DIFC rules in force in October 2026. Jurisdictions covered: UAE, UK. Rates, legislation and guidance change, so recheck before relying on this. Rules can differ between England and Wales, Scotland and Northern Ireland; tax residence is fact-specific; treaty outcomes depend on residence, domicile or nationality provisions; examples are simplified and omit reliefs, costs, exchange rates and anti-avoidance rules. This is general information, not financial, tax or legal advice. Take advice in the relevant country before acting.