Operating a company in Saudi Arabia
The government portals you'll live in, the real corporate tax rates, Saudization rules, and what PRO/GRO functions actually cover.
The government portals you'll use
Nine platforms, each run by a different ministry, covering labor, immigration, tax, commerce, municipal licensing, procurement and payroll.
- Qiwa (qiwa.sa) β HRSD's unified labor platform: work permits, e-contracts, employee transfers, Saudization compliance.
- Absher (absher.sa) β the Ministry of Interior's national e-government platform for passports, civil affairs, traffic and residency.
- Muqeem (muqeem.sa) β the employer-facing portal (under Jawazat) for managing employees' Iqama and visa transactions.
- GOSI (gosi.gov.sa) β social insurance: pensions, occupational-hazard coverage and unemployment insurance (SANED).
- ZATCA (zatca.gov.sa) β Zakat/tax registration, filing, payments and e-invoicing via the FATOORA platform.
- Saudi Business Center β one-stop CR issuance/amendment; registering here auto-registers you with HRSD, ZATCA, GOSI and Saudi Post.
- Balady (balady.gov.sa) β municipal permits and licenses, run by the Ministry of Municipal, Rural Affairs and Housing.
- Etimad (portal.etimad.sa) β government tenders, e-procurement and supplier payments, run by the Ministry of Finance.
- Mudad (mudad.com.sa) β Wage Protection System (WPS) compliance: monthly payroll submission mandated by HRSD.
Corporate taxation in Saudi Arabia
Tax liability splits by ownership: Zakat on the Saudi/GCC-owned share, income tax on the foreign-owned share β all administered by ZATCA.
- Zakat: 2.5% of the Zakat base, on the Saudi/GCC-owned share of a resident company.
- Corporate Income Tax: 20% flat, on the foreign-owned share of a resident company and on non-residents with a Saudi permanent establishment.
- VAT: 15% standard rate since 1 July 2020; mandatory registration above SAR 375,000 annual taxable supplies.
- Withholding tax on payments to non-residents: commonly cited at 5% (dividends, interest, rent), 15% (royalties), 20% (management fees) β technical/consulting-service rates are reported inconsistently across sources.
- RHQ tax incentive: 0% corporate tax and 0% withholding tax for 30 years on eligible RHQ activities (see the Business Setup guide).
- Transfer pricing rules are OECD-aligned (Master File, Local File, Country-by-Country Report); the disclosure form is due within 120 days of fiscal year-end.
- Annual Zakat/CIT return due within 120 days of fiscal year-end (e.g. 30 April for a standard calendar year).
The exact withholding-tax rate for technical/consulting services, oil-sector tax tiers, and transfer-pricing documentation thresholds are reported inconsistently across sources β confirm current figures with ZATCA or our team before relying on a specific rate.
HR & Saudization
The Nitaqat localization system, GOSI contributions, wage protection, and the labor-law basics every employer needs.
- Nitaqat (run via Qiwa, HRSD) assigns private-sector employers to color bands β the current version is officially called "Nitaqat Mutawar" (evolved Nitaqat).
- There's no single flat Saudization percentage β requirements are sector- and size-specific; check your establishment's exact requirement via Qiwa's Nitaqat calculator.
- GOSI: 2% Occupational Hazards (employer-paid, applies to Saudi and non-Saudi employees). Saudi nationals also pay Annuities/Pension and SANED (unemployment insurance) β rates are mid-transition under a new Social Insurance Law effective ~July 2025; confirm current rates directly with GOSI.
- Wage Protection System (WPS) via Mudad: mandatory bank-transferred salary payment and monthly payroll-data submission for private-sector employers.
- Probation period: 90 days by default, extendable to a maximum of 180 days by written agreement (Labor Law Article 53).
- Notice period (post-probation, per Feb 2025 amendments): 30 days if the employee resigns, 60 days if the employer terminates.
- End-of-service gratuity (Article 84): commonly described as half a month's wage per year for the first 5 years, then a full month's wage per year beyond that, pro-rated for partial years.
What PRO & GRO services cover
"PRO" (Public Relations Officer) and "GRO" (Government Relations Officer) are industry-standard function labels across the Gulf β not legally defined titles β for the team that handles your ongoing government-facing admin.
- Core functions: visa/Iqama processing and renewal, work-permit issuance, navigating Qiwa/Muqeem/Absher/GOSI/Mudad, and Nitaqat compliance monitoring.
- Also covers labor-office liaison, business/commercial licensing renewals, and acting as the daily point of contact with HRSD/MOI/municipal authorities.
- Commonly reported reference fees: Iqama renewal ~SAR 650/year; dependent levy ~SAR 400/month per dependent β both should be confirmed at time of transaction, as government fee schedules change.
Government rules, fees and programs change often. This guide is a starting reference β always confirm current figures with the official portal or ask our smart agent before relying on a specific number.
