A UAE salary calculator can help employees and employers understand how monthly pay, basic salary, allowances, overtime and end-of-service gratuity fit together. This 2026 guide focuses on the UAE private sector and uses current rules published by the UAE Government and the Ministry of Human Resources and Emiratisation (MOHRE).
The most important detail is that “salary” is not always the same as “basic salary.” Your employment contract may show a total monthly wage made up of a basic component plus housing, transport or other allowances. For several labour-law calculations, including statutory gratuity and overtime, the basic wage is especially important.
What should a UAE salary calculator include?
- Basic monthly salary
- Housing, transport and other contractual allowances
- Eligible overtime hours
- Normal overtime and night overtime rates
- Rest-day or holiday work where applicable
- Estimated end-of-service gratuity
- Any lawful deductions or employee-specific adjustments
1. Basic salary vs total salary in the UAE
Your total salary may include a basic salary plus allowances. For example, an employee could receive AED 10,000 per month made up of AED 6,000 basic salary and AED 4,000 in allowances. The full AED 10,000 is the employee’s contractual monthly wage, but statutory calculations may use the AED 6,000 basic component.
| Component | Example | Used for |
| Basic salary | AED 6,000 | Gratuity / overtime base |
| Allowances | AED 4,000 | Contractual monthly pay |
| Total monthly salary | AED 10,000 | Gross monthly package |
2. Is salary taxed in the UAE in 2026?
For individuals, the UAE currently does not levy personal income tax on salaries. That means an employee does not normally subtract a federal personal income-tax percentage from monthly salary in the way workers do in many other countries. However, employees can still have other deductions depending on their situation, contract, pension/social-security status, court orders, advances or employer-approved arrangements.
Official reference: UAE Government – Taxation
3. UAE overtime calculator formula
MOHRE’s worker guidance shows a practical hourly-wage formula for overtime calculations:
Hourly basic wage = Basic monthly salary ÷ 30 ÷ 8
For ordinary overtime beyond normal working hours, the UAE Labour Law provides at least the normal hourly basic wage plus 25%. For qualifying overtime between 10:00 PM and 4:00 AM, the increase is at least 50%; the night-overtime rule does not apply to shift workers in the same way. The law also contains separate treatment for work on the weekly rest day.
| Type | Multiplier | Illustrative formula |
| Normal overtime | 1.25× | Hourly basic wage × 1.25 × overtime hours |
| 10 PM–4 AM overtime | 1.50× | Hourly basic wage × 1.50 × eligible hours |
| Rest day if paid instead of substitute rest | 1.50× base rule | Check contract and statutory treatment |
Overtime example
Assume a basic salary of AED 6,000. The hourly basic wage is AED 6,000 ÷ 30 ÷ 8 = AED 25. If the employee performs 10 hours of ordinary eligible overtime, an illustrative calculation is AED 25 × 1.25 × 10 = AED 312.50.
4. UAE end-of-service gratuity calculator
For a full-time foreign worker in the UAE private sector who has completed at least one year of continuous service, statutory end-of-service gratuity is based on the last basic wage, not the total salary including allowances.
- Less than 1 year of continuous service: no statutory gratuity under this rule.
- First 5 years: 21 days of basic wage for each year of service.
- Years after the first 5: 30 days of basic wage for each additional year.
- Fractions of a year are calculated proportionately after completing at least one year.
- Unpaid absence days are excluded from the service period for this calculation.
- The total statutory gratuity cannot exceed two years’ wage.
Gratuity example: AED 6,000 basic salary
Daily basic wage = AED 6,000 ÷ 30 = AED 200.
If the employee has completed 4 years, the estimate is: AED 200 × 21 days × 4 years = AED 16,800.
If the employee has completed 7 years, the estimate is: first five years = AED 200 × 21 × 5 = AED 21,000; next two years = AED 200 × 30 × 2 = AED 12,000; total estimated gratuity = AED 33,000, before any lawful adjustments.
Official reference: UAE Government – End-of-service benefits for private-sector workers
5. Simple UAE monthly salary calculation
For a practical monthly estimate, use the following structure:
Estimated monthly pay = Basic salary + allowances + eligible overtime + other payable earnings − lawful deductions
This is a planning formula, not a substitute for your employment contract or payroll statement. Variable commissions, unpaid leave, salary advances, pension contributions, deductions and company-specific benefits can change the final amount.
6. Working hours to know before calculating overtime
Normal private-sector working hours are generally 8 hours per day or 48 hours per week, subject to permitted exceptions for certain sectors and work patterns. The UAE Labour Law also limits employer-directed overtime in ordinary circumstances and requires additional compensation where the statutory overtime rules apply.
Official reference: UAE Government – Working hours and overtime
7. Useful Smart Web Solutions calculators and tools
After estimating your salary, these free tools can help with budgeting, loan planning, VAT impact and currency conversion:
- UAE VAT Calculator – Estimate how VAT can affect a household budget and expenses.
- EMI Calculator – Estimate monthly loan repayments, total interest and total repayment.
- AED to INR Converter – Useful for UAE residents sending or comparing money in Indian rupees.
- Simple Calculator – Run quick salary, allowance and budgeting calculations.
- All Free Web Tools – Browse Smart Web Solutions calculators, converters and digital utilities.
8. Who can use this UAE salary calculator guide?
- Employees comparing a new UAE job offer
- Workers checking basic salary versus allowances
- HR teams preparing a simple salary explanation
- Employees estimating overtime before checking payroll
- People planning end-of-service gratuity
- UAE residents building a monthly household budget
Frequently Asked Questions
Does the UAE deduct income tax from employee salaries?
The UAE currently does not levy personal income tax on individuals. Your actual payslip can still include other lawful deductions or contributions that depend on your circumstances.
Is UAE gratuity calculated on basic salary or total salary?
For eligible full-time foreign private-sector workers, statutory end-of-service gratuity is calculated using the last basic wage, not housing, transport or similar allowances.
How many days of salary are used for UAE gratuity?
The standard private-sector rule is 21 days of basic wage for each year of the first five years and 30 days for each year after the first five, subject to eligibility and the statutory cap.
How is overtime calculated in the UAE?
MOHRE guidance calculates hourly basic wage as basic salary divided by 30 and then by 8. Ordinary eligible overtime is paid at the hourly basic wage plus at least 25%, while qualifying overtime between 10 PM and 4 AM receives at least a 50% increase.
What is the normal working day in the UAE private sector?
The general rule is 8 hours per day or 48 hours per week, although exceptions may apply to specific sectors, categories or work arrangements.
Can I use this guide as an official payroll statement?
No. It is an educational estimation guide. Your employment contract, payroll records, applicable labour rules and official guidance should be used for the final calculation.
Quick Summary
In 2026, UAE employees can estimate monthly pay by adding basic salary, allowances and eligible overtime, then subtracting lawful deductions. The UAE does not levy personal income tax on individuals. For eligible foreign full-time private-sector employees, end-of-service gratuity is generally based on the last basic wage at 21 days per year for the first five years and 30 days per year thereafter. MOHRE guidance uses basic salary ÷ 30 ÷ 8 to estimate the hourly basic wage for overtime.
Editorial Notes & Sources
This article is informational and is not legal, payroll or tax advice. Rules can vary by worker category, contract type, free-zone framework, government employment or special pension/social-security arrangements. Before finalising the settlement, re-check the official UAE Government and MOHRE pages.