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Entanglement entropy in local quantum field theories is typically ultraviolet divergent due to short distance effects in the neighbourhood of the entangling region. In the context of gauge/gravity duality, we show that surface terms in general relativity are able to capture this entanglement entropy. In particular, we demonstrate that for 1+1 dimensional CFTs at finite temperature whose gravity dual is the BTZ black hole, the Gibbons-Hawking-York term precisely reproduces the entanglement entropy which can be computed independently in the field theory