Saudi Arabia End of Service Benefit Calculator
Calculate your end-of-service gratuity under Articles 84 and 85 of the Saudi Labor Law, for either resignation or termination.
What this calculator does
Calculates your Saudi Arabia end-of-service benefit (EOSB) under Articles 84 and 85 of the Labor Law, accounting for whether you're leaving via termination or resignation, since the two are treated very differently.
Who this is for
Employees in Saudi Arabia planning a resignation or nearing contract end, or anyone estimating their EOSB entitlement as part of broader financial or career planning.
How this calculator works
Under Article 84 of the Saudi Labor Law, end-of-service benefit accrues at half a month's basic wage for each of the first five years of service, then a full month's wage for each year beyond five, with a pro-rata award for partial years. If you resign, Article 85 reduces the payout based on tenure: nothing under 2 years, one-third from 2–5 years, two-thirds from 5–10 years, and the full amount beyond 10 years. Termination by the employer (outside serious-misconduct cases under Article 80) generally entitles you to the full accrued amount regardless of tenure.
Worked example
SAR 10,000 basic monthly salary, 8 years of service: full entitlement = (10,000 × 0.5 × 5 years) + (10,000 × 1 × 3 remaining years) = 25,000 + 30,000 = SAR 55,000 full accrued amount. If leaving via termination, the full SAR 55,000 applies. If leaving via resignation instead at the same 8 years (falling in the 5-10 year band, two-thirds factor): 55,000 × 2/3 ≈ SAR 36,667 — nearly SAR 18,333 less, purely based on how the employment ended.
EOSB growth by year of service
Run the calculator above to see how your full-entitlement EOSB accrues year by year.
Common mistakes
- Assuming resignation always pays the full amount. Article 85 reduces the payout on resignation unless you've completed at least 10 years — termination and resignation are not treated the same.
- Using total salary instead of basic salary. Only basic wage (plus certain fixed allowances) counts toward the calculation — housing allowances, bonuses, and commissions are typically excluded.
- Rounding down partial years. The law entitles you to a pro-rata award for fractions of a year worked — stopping at full years only understates the true entitlement.
- Not checking Article 80 grounds before assuming full termination entitlement. Termination for documented serious misconduct under Article 80 can forfeit EOSB entirely — the full-amount rule applies to ordinary terminations, not misconduct dismissals.
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Frequently Asked Questions
How much less do I get if I resign instead of being terminated?
It depends on tenure: under 2 years you get nothing on resignation (vs. the full amount on termination), 2-5 years you get one-third, 5-10 years you get two-thirds, and beyond 10 years resignation and termination pay the same full amount. The gap is largest for mid-tenure employees.
Do I get less gratuity if I resign?
Yes, under Article 85: less than 2 years of service gets nothing, 2–5 years gets one-third of the full amount, 5–10 years gets two-thirds, and more than 10 years gets the full amount. Termination by the employer (outside Article 80 misconduct cases) generally entitles you to the full amount regardless of tenure.
Is EOSB based on basic salary or total salary?
Basic salary (plus fixed allowances that are part of the contracted wage) under Article 87's definition of Actual Wage — discretionary bonuses and variable commissions are typically excluded.
Is gratuity taxed in Saudi Arabia?
There is no personal income tax in Saudi Arabia for employment income, so end-of-service benefits are not subject to income tax.