Basic vs allowances
A UAE salary is usually split into a basic wage plus allowances (housing, transport, and so on). The split matters because the end-of-service gratuity is computed on the basic wage alone. A common market practice sets basic at a share of gross, but there is no statutory minimum ratio — so this page treats that share as an editable assumption, clearly labelled as practice, not law.
Total monthly pay before any deduction (basic + allowances).
Market practice, not law — the basic share drives your gratuity.
Net (take-home)
Net (take-home): 15,000.00 AED- Net (take-home)15,000.00100%
- Gross monthly salary
- 15,000.00 AED
- Basic salary
- 9,000.00 AED
- Allowances
- 6,000.00 AED
- Income tax
- 0.00 AED
- ILOE insurance (paid separately)
- 5.25 AED
No income tax and no employee social security are withheld from an expatriate’s pay in the UAE — so your take-home equals your gross. You keep 100%.
Notes on this calculation (1)
ILOE unemployment-insurance premium: category A, 5.25 AED a month. This is paid separately through the ILOE portal — it is informational and is NOT deducted from your pay.
What a UAE salary is made of
A UAE salary almost always arrives in two parts. There is the basic wage — the core figure named in your contract — and there are allowances, typically for housing, transport and utilities, sometimes furniture or a general cost-of-living top-up. Add them together and you have your gross package, the headline number on the offer letter. Because there is no income tax, that gross is also, for an expatriate, your take-home. So on a monthly basis the split looks cosmetic — the same amount lands in your account either way.
Why the split is not cosmetic at all
The split stops being cosmetic the moment the job ends. The end-of-service gratuity is calculated on the basic wage alone — allowances are explicitly excluded by the labour law. Two people on an identical total package can therefore walk away with very different lump sums: the one whose contract loads more into basic accrues a larger gratuity year after year, while the one with a thin basic and a fat housing allowance accrues less, even though their monthly take-home was the same. The ILOE unemployment-insurance category is set by your basic pay too, so the same figure quietly drives more than one thing.
The 60% rule is practice, not law
You will often read that basic salary “must be at least 60% of gross.” It is a useful benchmark, and suppressing basic to shrink a future gratuity is a real challenge risk that a labour court may look through — but it is not a codified statute. There is no minimum basic-to-gross ratio written into UAE law; the 60% figure is MOHRE and market practice plus court expectation, not a legal floor. That is a distinction worth being precise about, and it is why this calculator treats the basic share as an editable assumption — it defaults to 60% of gross for a first estimate, clearly labelled as practice rather than law, and invites you to replace it with the real figure from your own contract.
What to check on your own contract
The practical takeaway is simple: find the basic-salary line on your contract and enter it above rather than trusting the default. That single number is what compounds into your end-of-service payout, so it is the figure to negotiate on and the one to verify before you rely on any estimate. Everything shown here is an estimate, for scale rather than for a settlement.