The General Pension and Social Security Authority (GPSSA) has issued clear guidance on how employers in the United Arab Emirates must compute monthly pension contributions for both public and private workers.
For employees in the government sector, the contribution amount is linked directly to the actual salary earned each month. Any raise takes effect immediately, so if a civil servant earns Dh20,000 from January to March and receives a Dh22,000 salary starting in April, the pension contribution will reflect the lower figure for the first three months and the higher figure from April onward.
This month‑by‑month method ensures contributions stay in step with current earnings.
Private‑sector companies follow a different rule. Their contributions are based on the salary that was approved at the start of the year and remain unchanged for the entire calendar year, regardless of later pay adjustments. For instance, an employee paid Dh15,000 in January who gets a raise to Dh17,000 in July will still have pension contributions calculated on the Dh15,000 figure until the end of December. The new salary only becomes the basis for contributions from January of the following year.
A special case applies when a salary increase is approved retroactively to January of the same year; in such instances, the authority may require recalculation of contributions for earlier months.
Employers are reminded to keep salary information up to date through the Ma’ashi digital platform, adhering to the specific procedures for their sector.
Contributions must be paid by the end of the relevant month and are due no later than the 15th of the following month. Late payments attract statutory penalties.
The GPSSA also emphasized that contributions are mandatory for every service period completed by UAE nationals under the pension law, irrespective of the length of service, and they become part of each employee’s social insurance record.
