UAE Salary Calculator: Take-Home Pay, Overtime and Gratuity
There is no income tax on salaries in the UAE, so your take-home pay is your gross salary minus a few small deductions. For most expatriates the only routine deduction is the ILOE job loss insurance premium of AED 5 a month plus VAT, or AED 10 plus VAT if your basic salary is above AED 16,000. UAE nationals also pay a pension contribution, 11% of salary for those covered by the 2023 pension law. Use the calculator below to see your monthly and annual take-home pay, your daily and overtime rates, and how much gratuity you build up each year.
An estimate. Your employer may apply other agreed deductions, such as loan instalments or advances, and pension rules vary by scheme and joining date.
How take-home pay works in the UAE
UAE employers pay salaries without deducting income tax, because there is no personal income tax on employment income. Most private sector salaries are paid through the Wage Protection System, and the employer pays its own costs, such as your health insurance in the emirates where it is mandatory and, for expatriates, the end of service gratuity. What leaves your gross pay is limited to a few items set by law or agreed in writing.
Why your basic salary matters
A UAE salary is usually split into a basic salary and allowances. The split looks like paperwork, but several important numbers are worked out on the basic salary alone.
| What is calculated | Based on | Rule |
|---|---|---|
| End of service gratuity | Basic salary | 21 days’ basic pay per year for the first 5 years, then 30 days |
| Overtime | Basic hourly wage | At least 125%, or 150% between 10 pm and 4 am |
| ILOE category | Basic salary | AED 16,000 or below is Category A |
| Daily wage | Basic salary | Basic divided by 30 |
That is why two job offers with the same total package can be worth different amounts. An offer of AED 10,000 with a basic of AED 6,000 builds more gratuity and pays more overtime than AED 10,000 with a basic of AED 4,000. Our gratuity calculator shows the end of service figure in full.
Comparing two job offers
When you compare offers, look past the monthly total. Write down the basic salary, each allowance, and the benefits paid separately, such as annual flight tickets, school fee support or a company car, because these can be worth more than a small salary difference. Check whether housing is paid monthly or as a lump sum, whether the employer covers your ILOE premium, and which emirate the job is in, since living costs differ. Then run each offer through the calculator above and compare take-home pay, overtime rates and gratuity side by side. A higher basic salary in a slightly smaller package can leave you better off over several years, especially if overtime is common in your role.
Ask how and when salary is paid as well. Payment through the Wage Protection System on a fixed date each month makes budgeting easier, and an account with an IBAN, rather than a payroll card, makes it simpler to send money home and build a banking record. Our UAE banking guide covers salary accounts and cards.
Deductions that can apply
| Deduction | Who pays it | Amount |
|---|---|---|
| ILOE job loss insurance | Most private sector and federal employees | AED 5 plus VAT a month, or AED 10 plus VAT above AED 16,000 basic |
| Pension contribution | UAE nationals | 11% of salary under the 2023 pension law; lower rates for some earlier members |
| Income tax | Nobody | None on employment income |
| Agreed deductions | Anyone, with consent | Such as advances or loan instalments the employee has agreed to |
ILOE is often paid directly by the employee, monthly or as a yearly lump sum, rather than taken from salary, so it may not appear on your payslip at all. Under the 2023 pension law, Emirati employee contributions are calculated on the full salary, including incentive payments, and the employer and government contribute on top. Our ILOE guide explains the job loss scheme.
Worked examples
| Employee | Gross monthly | Deductions | Take-home |
|---|---|---|---|
| Expatriate, AED 3,000 basic plus AED 1,500 allowances | AED 4,500 | ILOE AED 5.25 | AED 4,494.75 |
| Expatriate, AED 18,000 basic plus AED 7,000 allowances | AED 25,000 | ILOE AED 10.50 | AED 24,989.50 |
| UAE national, AED 20,000 total salary, 11% pension | AED 20,000 | Pension AED 2,200 and ILOE AED 5.25 | AED 17,794.75 |
The UAE national example assumes a basic salary of AED 16,000 or below for the ILOE category. For expatriates, gratuity is a further benefit on top of take-home pay: on a basic of AED 3,000, it builds up at AED 2,100 a year for the first five years.
Checking your payslip
Compare what arrives in your account with the salary in your contract each month. If the amount is lower without a written reason, ask HR for a breakdown. Late or short salary payments can be reported to the Ministry of Human Resources and Emiratisation, as our WPS salary complaint guide explains. If you need proof of income for a bank, a tenancy or a visa, ask for a salary certificate, and check your contract details through our labour contract guide. More everyday guides are in our UAE living guide.
Frequently asked questions
Is salary taxed in the UAE?
No. There is no personal income tax on employment income, so your gross salary is only reduced by items such as ILOE insurance and, for UAE nationals, pension contributions.
How is overtime calculated in the UAE?
On your basic hourly wage, which is basic salary divided by 30 and then by 8, paid at least 125%, or 150% for work between 10 pm and 4 am.
How much is the ILOE deduction?
AED 5 plus VAT a month if your basic salary is AED 16,000 or below, and AED 10 plus VAT above that.
How much pension do UAE nationals pay?
Under the 2023 pension law, the employee contribution is 11% of salary. Some members who joined earlier contribute at a lower rate, so check your own scheme.
Last verified: October 2026 against Federal Decree-Law No. 33 of 2021 on labour relations, the ILOE scheme rules and Federal Decree-Law No. 57 of 2023 on pensions. The calculator gives estimates only.
Written by Roman Shah · Reviewed by the UAEexplained editorial team
Sources: Ministry of Human Resources and Emiratisation, General Pension and Social Security Authority
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