01
No income tax
The UAE levies no personal income tax. For an expatriate, gross salary equals net salary, one of the most competitive structures in the world for attracting talent.
Gratuity & employee cost calculator
UAE gratuity & employee cost calculator
Calculate end-of-service gratuity and the full cost of hiring in the UAE.
No income tax, but gratuity, mandatory medical cover and, for Emiratis, the Maashi pension sit on top of salary. Free to use.
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Total annual cost of employment
250,400AED
4.3%
employer cost on top
- Gross annual salaryAED 240,000
- Maashi pension for nationals (15%)AED 0
- End-of-service gratuityAED 8,400
- Visa & Emirates ID (2-year visa)AED 5,400
- Emiratisation fee (AED 550 a month)AED 6,600
- Total annual cost of employmentAED 250,400
Estimate in AED. Gratuity and pension are calculated on basic pay; we assume 60% of gross. Visa figures are the cost per visa (two-year on the mainland, one-year in the Dubai and Abu Dhabi free zones) and can be adjusted under Advanced; mainland hires also carry an Emiratisation fee of AED 550 a month. Medical cover is billed separately and is not included; medical costs may vary by gender and age. Statutory rates verified to 2026; confirm before payroll.
How employer costs work in the UAE
Salary is one line. The rest is statutory, and it varies with who you employ. Here is what shapes the true cost.
02
End-of-service gratuity
For expatriates there is no monthly social contribution. Instead the employer accrues gratuity: 21 days of basic pay per year for the first five years, and 30 days per year after that. On the mainland, in free zones and in ADGM this accrues as a lump sum; in the DIFC it is funded monthly through DEWS at the same rate.
03
Maashi pension for Emiratis
Employing a UAE national is structurally more expensive: the employer pays a 15% Maashi pension on the contribution salary (ADPF in Abu Dhabi free zones) under the post-2023 law (12.5% for those registered earlier), and Emiratis receive pension rather than gratuity.
04
Medical cover is mandatory
Employers must provide health insurance, but it is billed separately based on each team member’s profile and dependants, so it sits outside the estimate below rather than appearing as a flat line. Medical costs may vary by gender and age.
Mainland, free zone, DIFC or ADGM?
Where you employ in the UAE changes the end-of-service mechanism and the compliance route more than the headline cost. Across all four, end-of-service is worth about 5.83% of basic a year.
| Jurisdiction | End-of-service | Employer cost | Emiratisation | Visa route |
|---|---|---|---|---|
| Mainland | Accrued gratuity | ~5.83% | Yes (50+ staff) | MOHRE, 2-year visa minimum |
| Free zone – Dubai (DIFC, DWTC…) | Gratuity (funded DEWS in DIFC) | ~5.83% | Usually exempt | Free-zone authority, 1-year visa |
| Free zone – Abu Dhabi (ADGM…) | Accrued gratuity | ~5.83% | Usually exempt | Free-zone authority, 1-year visa |
| Other free zone | Accrued gratuity | ~5.83% | Usually exempt | Free-zone authority (costed as mainland) |
UAE nationals pay into the Maashi pension in every jurisdiction except the Abu Dhabi free zones (ADGM and others), where the Abu Dhabi Pension Fund (ADPF) applies at the same 15%; GCC nationals pay their home-country pension instead. Medical costs may vary by gender and age. Switch jurisdiction in the calculator above to see the end-of-service line relabel.
A worked example
A team member on AED 20,000 a month, with basic pay at 60% of gross (AED 12,000).
| Employer cost per year |  Expatriate |  UAE national |
|---|---|---|
| End-of-service gratuity | AED 8,400 | — |
| Maashi pension for nationals (15%) | — | AED 21,600 |
| Mandatory medical cover | AED 3,500 | AED 3,500 |
| Total on top of salary | AED 11,900 · 5.0% | AED 25,100 · 10.5% |
Other obligations when
you employ in the UAE
Beyond salary and end-of-service, these shape the real cost and compliance picture.
Wage Protection System (WPS)
Salaries must be paid through the WPS via MOHRE-approved channels, with penalties for late or missed payment.
Mandatory health insurance
Employer-provided cover is required in Dubai and Abu Dhabi and is expanding federally. Cost varies by plan and emirate.
Emiratisation (Nafis)
Private firms of 50+ staff in target sectors must meet Emirati-hiring quotas or pay a monthly levy per unfilled role.
Visa and work permit
On the mainland, the work permit, residence visa and Emirates ID run for a minimum of two years; in Dubai and Abu Dhabi free zones they are issued for one year.
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FAQs
Got Questions? Find Answers Here
How much does it cost to employ someone in the UAE?
For an expatriate, the employer cost on top of salary is low: end-of-service gratuity of about 5.8% of basic pay per year, plus mandatory medical cover. There is no income tax and no social security. For a UAE national, add 15% Maashi pension. Use the calculator above for a figure on your salary.
Do expats pay social security in the UAE?
No. Expatriate team members sit outside the Maashi pension system entirely. Their end-of-employment entitlement is the end-of-service gratuity under Federal Decree-Law 33 of 2021.
Is gratuity calculated on gross or basic salary?
On basic salary only. In the UAE, basic is typically 50 to 60% of gross. The calculator assumes 60% by default; you can adjust it.
When is end-of-service gratuity paid?
On the end of employment, once the team member has completed at least one year of continuous service. It is settled as a lump sum at departure, so employers accrue for it over the employment.
Does the UAE have a wage protection system?
Yes. Salaries must be paid through the Wage Protection System (WPS) via MOHRE-approved channels, with penalties for late or missed payments.
Does Emiratisation add to employer cost?
It can. Private companies of 50 or more staff in target sectors must meet Emirati-hiring quotas or pay a monthly levy for each unfilled position, on top of the higher cost of employing nationals.
Does hiring in DIFC or a free zone cost more?
Not really, on the statutory side. The end-of-service amount is broadly the same across mainland, free zones, DIFC and ADGM (about 5.83% of basic a year). What differs is the mechanism: DIFC funds it monthly through DEWS while the mainland and ADGM accrue a lump sum, and free zones differ mainly on visa, licensing and Emiratisation, not the per-employee cost. Switch jurisdiction in the calculator to see the labelling change.
Does resignation reduce your gratuity in the UAE?
No. Since Federal Decree-Law 33 of 2021, an employee who resigns receives the same end-of-service gratuity as one whose contract the employer ends, provided they have completed at least one year of service. Older calculators that show a reduced rate for resignation are out of date.
