GPSSA Pension Fund for UAE Nationals 2026: Contributions, Pension Calculation, Penalties

GPSSA (General Pension and Social Security Authority) is the federal pension fund for UAE nationals working in the government and private sectors in every emirate except Abu Dhabi (which has its own Abu Dhabi Pension Fund). Important: this system covers UAE nationals only — foreign employees do not receive a pension, they receive an end-of-service gratuity instead. Since 31 October 2023, two regimes apply in parallel: the old regime (Federal Law No. 7 of 1999, 20% contributions) for those registered with GPSSA before that date, and the new regime (Federal Decree-Law No. 57 of 2023, 26% contributions) for anyone entering the UAE workforce for the first time on or after that date.

⚠ IMPORTANT: neither regime is designed for foreign employees. They are covered by a different mechanism — the end-of-service gratuity under Article 51 of Federal Decree-Law No. 33 of 2021 (UPPERSETUP has already published a dedicated article on this topic).

1. Who Administers Pensions in the UAE

System	Region	Covers
GPSSA	all emirates except Abu Dhabi	UAE nationals in government and private sectors
Abu Dhabi Pension Fund (ADPF / ADRPBF)	Abu Dhabi	UAE nationals working in Abu Dhabi
GCC Pension Coordination	all emirates	Nationals of other GCC countries working in the UAE

An employer must register a UAE national employee with GPSSA within 30 days of the hiring date — this is mandatory for every employer, government or private, mainland or free zone, as soon as at least one UAE or GCC national is on the payroll.

Need help with payroll setup and GPSSA registration? UPPERSETUP HR and tax services →

2. Contributions: Old Regime vs New Regime

Parameter	Federal Law No. 7 of 1999 (old regime)	Federal Decree-Law No. 57 of 2023 (new regime)
Who is covered	UAE nationals registered with GPSSA before 31 October 2023	UAE nationals entering the workforce for the first time on or after 31 October 2023
Total contribution	20% of salary: 5% employee + 15% employer	26% of salary: 11% employee + 15% employer
Maximum pensionable salary (private sector)	AED 50,000 / month	AED 70,000 / month
Minimum retirement age	60 years	55 years
Minimum service period	15 years	30 years
Government subsidy to employers	None	2.5% of the employer’s contribution if salary < AED 20,000
Pension calculation rate	Different formula (average salary over full service)	2.67% per year up to 30 years, then +4%/year, capped at 100%

ℹ The key dividing line is the date of initial GPSSA registration — not date of birth, not age. A national who first entered the UAE workforce before 31 October 2023 remains under the old regime regardless, even if they are 18 years old today.

The new law was published and entered into force on 31 October 2023. The actual contribution rates under the new regime became payable starting 1 January 2024 — no late payment penalties applied for the period 31 October to 31 December 2023. Note: the law text itself was published on 2 October 2023 (Al Tamimi, DLA Piper, PwC); 31 October is the date GPSSA confirmed at a press conference as the practical cutoff for new employees under the new regime (Gulf News). Use 31 October as the operative dividing line.

3. Eligibility for Pension Under the New Law (Federal Decree-Law No. 57 of 2023)

•       Standard retirement: age 55 with a minimum of 30 years of contributions.

•       Early retirement: men at 55 with 20 years of service, women at 50 with 20 years of service.

•       For mothers with 5 or more children (married, divorced, or widowed): age and service requirements may be reduced.

•       A pensioner with a contribution period exceeding 30 years can combine the pension with a salary from a new job.

⚠ Under the old regime (Federal Law No. 7 of 1999), the conditions differ: age 60 and a minimum of 15 years of service. Some secondary sources conflate the two regimes — always check which registration date a given figure refers to.

•       Early retirement also exists under the old regime: voluntary resignation after 20 years of service entitles an employee to a pension from age 50 (Federal Law No. 7 of 1999, confirmed by GPSSA).

ℹ A common rule across both regimes: if service is under 15 years at the time of leaving, the employee receives not a pension but a one-time end-of-service payment (a gratuity-equivalent within the GPSSA system). 15 years is the threshold between a lump-sum payout and a lifetime pension (GPSSA official).

Since November 2025, GPSSA has extended the installment plan for consolidating prior service periods from 4 to 10 years — a Board of Directors decision from September 2025, with the second phase opening on 3 November 2025. Available to all insured individuals, provided the monthly installment is no less than one-quarter of the contributory salary.

4. Pension Calculation: Formula and Worked Example

Under the new law, pension is calculated from the average contribution account salary over the last 6 years of service (or the full service period, if shorter). Rate: 2.67% of that average for each year of service during the first 30 years. Beyond 30 years, the rate rises by 4% per year, capped at 100% of the average salary.

Worked example (from GPSSA’s own official explainer): an employee with 33 years of service and an average contribution account salary of AED 39,000 over the last 6 years. The first 30 years yield 80% (30 × 2.67%). The remaining 3 years add 12% (3 × 4%). Total: 92% of AED 39,000 = AED 35,880 per month.

✅ GPSSA guarantees a minimum monthly pension of AED 10,000. If the calculated amount falls below this, the fund covers the difference.

⚠ For service exceeding 35 years, an additional payment applies — 3 months’ salary for each year beyond the 35-year mark.

5. Contribution Deadlines and Employer Penalties

•       Employee registration with GPSSA: within 30 days of the hiring date.

•       Notification of termination: within 15 days of the employee leaving.

•       Monthly contribution payment: by the 15th of the month following the period due.

⚠ NO GRACE PERIOD AT ALL FOR LATE PAYMENT: from the 16th of the month, a penalty of 0.1% of the outstanding amount accrues automatically for every calendar day of delay. It applies without prior warning or notification from GPSSA.

An additional penalty of AED 200 per day applies if the employer misses registration or termination notification deadlines.

6. Who Falls Outside the New Regime

•       Existing pensioners. Anyone already receiving a pension under the old law remains under it, even if they take up new employment.

•       Employees who already received gratuity under the old law. They stay in the old system if they continue with the same or a new employer.

•       UAE nationals working in Abu Dhabi. Covered by the Abu Dhabi Pension Fund, not GPSSA.

•       Foreign employees. They are entitled to gratuity, not a GPSSA pension.

FAQ

How do I know which regime applies to an employee?

The key criterion is the date of first entry into the UAE workforce. Before 31 October 2023 — Federal Law No. 7 of 1999. After that date — Federal Decree-Law No. 57 of 2023.

Can a foreigner in the UAE become a GPSSA member?

The system covers only UAE nationals and, under separate agreements, nationals of other GCC states. Other expatriates receive gratuity under Article 51 of the Labour Law.

Can a pension be claimed before age 55?

Yes, with 20 years of service for men (from age 55) or women (from age 50). For mothers with 5 or more children, age and service requirements may be reduced.

What is the 2.5% government subsidy for?

It incentivises hiring UAE nationals in the private sector with a salary below AED 20,000 — the government covers part of the employer’s contribution.

Key Takeaways

•       Regime selection depends on the date of first entry into the UAE workforce: 31 October 2023.

•       New regime: 26% contributions (11%+15%), retirement at 55 with 30 years of service.

•       Old regime: 20% contributions (5%+15%), retirement at 60 with 15 years of service.

•       Pension = 2.67% per year up to 30 years, then +4%/year, minimum AED 10,000.

•       Employee registration: 30 days. Late contribution penalty: 0.1% per day, automatic.

•       Foreign employees are outside this system entirely — their entitlement is gratuity under Article 51 of the Labour Law.

Summary

GPSSA (General Pension and Social Security Authority) is the federal pension fund for UAE nationals working in the government and private sectors in every emirate except Abu Dhabi. Since 31 October 2023, two regimes apply in parallel: Federal Law No. 7 of 1999 (20% contributions, retirement at age 60 with 15 years of service) for those registered before that date, and Federal Decree-Law No. 57 of 2023 (26% contributions, retirement at age 55 with 30 years of service) for anyone entering the UAE workforce for the first time after that date. Under the new law, pension is calculated as 2.67% of the average salary over the final 6 years of service for each year of service up to 30 years, then +4% per year, capped at 100%. Foreign employees are not covered by this system — they are entitled to an end-of-service gratuity under Article 51 of Federal Decree-Law No. 33 of 2021.

Sources

• Federal Decree-Law No. 57 of 2023 on Pension and Social Security, effective 31 October 2023 (gpssa.gov.ae)

• Federal Law No. 7 of 1999 on Pension and Social Security (old regime) — official government portal (u.ae)

• GPSSA — Calculating retirement pension in accordance to Federal Law No. 57 of 2023 explained (official, with worked example) (gpssa.gov.ae)

• Al Tamimi & Company — The New UAE Pensions Law (January 2024) (tamimi.com)

• Chambers and Partners — Understanding the Key Features of UAE’s New Emirati Pension Law (January 2024) (chambers.com)

• Lexology — Breaking Down Law No. 57 of 2023: A Comprehensive Overview (January 2024) (lexology.com)

• DLA Piper — New UAE Pensions Law (knowledge.dlapiper.com)

• Link Compliance — UAE Payroll: Key Compliance Requirements (2026) (linkcompliance.com)

• GPSSA — official portal — contribution deadlines and penalties (gpssa.gov.ae)

• FastLane Career — GPSSA UAE: Applicability, Contribution Calculations & Penalties (2026 Guide) (March 2026) (fastlanecareer.com)

• GPSSA — The seven conditions related to pension disbursements in Law No. 57 of 2023 (gpssa.gov.ae)

• Gulf News — Entities hiring Emiratis as of October 31 will now pay 26% of their income as pension (GPSSA press conference) (gulfnews.com)

• Gulf News — UAE pension authority launches 10-year flexible payment plan (November 2025) (gulfnews.com)

Disclaimer

This material is for informational purposes only and does not constitute legal, tax, financial, investment, or consulting advice. Before making any decisions, obtain individual professional advice tailored to your specific situation, nationality, employer status, and current GPSSA requirements. Information is accurate as of June 2026.