A AED 300,000/year package for an expatriate hire actually costs the employer roughly AED 314,232 to AED 316,932 once mandatory health insurance, visa and labour card fees, and gratuity accrual are layered on, a load of 4.7% to 5.6%. Hire a UAE national on the same package instead and GPSSA employer contributions push the load to 13.5% to 14.4%.
Expat load
+4.7–5.6%
health + visa + gratuity
National load
+13.5–14.4%
adds GPSSA 12.5-15%
Health insurance
Mandatory
employer-paid, every Emirate
GPSSA
Nationals only
not expatriates
70% (AED 210,000/yr basic)
True annual cost to hire
AED 314,232 – AED 316,932
Load on top of package
+4.7% to +5.6%
Quoted package
Basic + housing + transport + other allowances
AED 300,000
Health insurance (employer-paid)
DHA Essential Benefits Plan floor to an enhanced group plan
AED 650 – AED 1,100
Visa + labour card (annualized)
2-year mainland permit bundle, spread across the cycle
AED 1,500 – AED 3,750
Gratuity accrual (year-1 rate)
21 days' basic pay/year provision, on basic salary only
AED 12,082
Need the employee-side gratuity or package split first?
Open the EOSG CalculatorThere's no employer payroll tax in the UAE, but four real cost lines sit on top of a quoted package regardless. Health insurance is mandatory in every Emirate and must be fully employer-funded, Dubai's DHA Essential Benefits Plan sets a floor around AED 650-1,100/year per employee, with enhanced group plans running AED 1,500-4,500/year. The employment visa and labour card bundle, covering the MOHRE work permit, entry permit, medical test, Emirates ID, and residence visa stamping, typically runs AED 3,000-7,500 for a 2-year mainland cycle, which this calculator annualizes by spreading it across the 2 years.
Gratuity is the third line, and unlike the other two it's basic-salary-only and grows every year an employee stays. This calculator provisions it at the conservative year-1 rate (21 days' basic pay), the floor a prudent finance team should budget annually rather than treating the eventual lump sum as a surprise. That rate rises to 30 days' basic pay per year once an employee crosses 5 years, so tenure genuinely raises the ongoing cost of a role, not just the risk of it.
GPSSA is the one line that only applies to UAE and GCC nationals, adding 12.5% (subsidized, under AED 20,000/month basic) or 15% of contributable salary on the employer side, on top of the employee's own 11% deduction, capped at an AED 70,000/month contributable salary. For expatriates there's no equivalent payroll pension line at all, gratuity fills that role instead, which is why national and expat true-cost figures diverge so much on an identical package.
Expatriate vs UAE national, essential health tier
| Line item | Expatriate | UAE national |
|---|---|---|
| Health insurance | AED 650–AED 1,100 | AED 650–AED 1,100 |
| Visa + labour card (annualized) | AED 1,500–AED 3,750 | AED 1,500–AED 3,750 |
| Gratuity accrual (year-1 rate) | AED 12,082 | AED 12,082 |
| GPSSA employer (nationals only) | AED 0 | AED 26,250 |
| True annual cost | AED 314,232–AED 316,932 | AED 340,482–AED 343,182 |
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Typically an extra 4-10% of the quoted package per year once you add mandatory health insurance, the annualized cost of the employment visa and labour card, and an annual gratuity provision. If the employee is a UAE or GCC national, add GPSSA employer contributions of 12.5-15% of basic salary on top, which is a much larger load.
Yes. Every Emirate requires employers to provide health insurance for their employees, and the cost must be borne entirely by the employer, not deducted from salary. Dubai's DHA Essential Benefits Plan sets a floor of roughly AED 650-1,100/year per employee for a basic plan; deducting the premium from an employee's pay is a violation that carries a fine.
A typical 2-year mainland employment visa bundle, covering the MOHRE work permit and labour card, entry permit, medical test, Emirates ID, and residence visa stamping, runs roughly AED 3,000-7,500 per employee, depending on the employer's classification category and Emirate. It is illegal for an employer to recover this cost from the employee.
Gratuity is paid as a lump sum only when an employee exits, but a well-run business should provision for it every year it's being earned, not treat it as a surprise cost at offboarding. The calculator shows the year-1 accrual rate (21 days' basic pay), which is the conservative annual provisioning most finance teams use before an employee crosses the 5-year step-up to 30 days.
No. GPSSA pension contributions only apply to UAE and GCC nationals. For expatriate employees there is no employer or employee payroll pension contribution at all; gratuity is the expat equivalent end-of-service benefit instead.
Under Federal Law No. 57 of 2023, the employer contributes 15% of contributable salary (reduced to 12.5% via a government subsidy for private-sector nationals earning under AED 20,000/month), the employee contributes 11%, and contributions are capped at a AED 70,000/month contributable salary.
Related UAE tools and reading
Employer cost is one side of the ledger. These tools cover the employee side.
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