Sending your gratuity home: how to keep more of it

The cost of sending money home is the fee plus the exchange-rate margin. The margin is the gap between the mid rate and the rate you are given, and it is taken from the money before it arrives. So compare the amount that arrives at home, not the fee.

Here is how it works on a real gratuity. Six years on AED 10,000 a month basic in the UAE gives AED 45,000 (check yours with the UAE calculator). Say 1 AED buys 20 units of your home currency at the mid rate. This is an example rate, not today's.

• Quote A charges no fee but gives a rate 2% below the mid rate. 882,000 units arrive. The margin costs AED 900.
• Quote B charges a AED 150 fee and gives a rate 0.5% below the mid rate. 892,515 units arrive. Fee and margin together cost AED 374.

The quote with no fee sends less money home. A bank or a transfer service could quote either way, so work it out for each quote you get.

Your bank and a money transfer service can both send money home. Ask each one for a quote on the same amount, at about the same time, and compare these four things:

• The amount that arrives. This one number includes the fee and the margin.
• Speed. When the money reaches the account at home.
• Limits. The most you can send in one transfer, and per day or month.
• ID checks. What documents they need before they send a large sum.

The FX converter can show what your amount is worth in your home currency, so you have a number to hold each quote against.

An end of service payment can be a large sum to send in one go. Two things decide how to send it: the limits, and the paperwork.

One transfer or several? Each transfer can carry its own fee, so several smaller transfers can cost more. They can also keep you within a daily limit and let you check the route works before the full sum goes. Ask your bank and the transfer service for their limits before you decide.

Keep proof of where the money came from. For a large transfer, banks and providers may ask where the money came from. Your final settlement statement and your last payslip show it is your end of service pay. Keep copies on your phone and on paper before you leave the country.

Before any of this, make sure the amount is right. The settlement checker compares what you were paid with what the law gives you.

Not every service takes payment in every Gulf country. These send money online from each one, paid for in that country:

• Kuwait: Western Union, LuLu Money, BEC Pay and Al Mulla Exchange.
• Saudi Arabia: Western Union and STC Bank.
• The UAE: Western Union and Remitly.
• Qatar: Western Union.
• Bahrain: Western Union.
• Oman: ask your bank or an exchange house for a quote.

Get a quote from more than one and compare the amount that arrives at home.

Plan the transfer for when the money is in your account. The UAE and Saudi labour laws set the payment day:

• UAE: your employer must pay your wages and all your other dues, including your gratuity, within 14 days of the contract end date (Decree-Law 33/2021, Art. 53).
• Saudi Arabia: within one week if your employer ended the contract or it ran out, and within two weeks if you ended it (Labour Law Art. 88).
• Kuwait, Qatar, Oman and Bahrain: ask the labour ministry, or PAM in Kuwait, when your final pay is due.

The leaving plan puts these dates on a calendar from your last working day, with your visa and claim deadlines.

Your home country's rules decide whether the money is taxed once it arrives, so check them before you pick a date to send it. The tax estimator gives a first idea in your own numbers.