Hire in Saudi Arabia
Kingdom of Saudi Arabia — 36 million population, $27,600 GDP per capita. Everything you need to know about employment law, tax, compliance and hiring in Saudi Arabia.
Capital
Riyadh
Currency
Saudi Riyal (SAR)
Languages
Arabic
Time zones
UTC+3 (AST)
Hiring overview
- Typical time to hire
- 2-4 weeks for contractor, 4-8 weeks for full-time (visa processing can add weeks)
- Entity requirement
- Saudi LLC or branch. Must have a local partner (unless in special economic zones). SAGIA registration.
- EOR available
- Yes — from $399/employee/month through a Corpshore entity
- Contractor of record
- Yes — from $39/worker/month
Employment law
- Standard workweek
- 48 hours (40 during Ramadan for Muslims)
- Maximum weekly hours
- 48 hours
- Minimum annual leave
- 21 days (30 after 5 years)
- Public holidays
- 4 per year
- Maternity leave
- 10 weeks (4 before + 6 after) at full pay
- Paternity leave
- 3 days
- Notice period
- 60 days (indefinite contracts) or as per contract (fixed-term)
- Severance
- End of service benefit: 15 days per year (first 5 years) + 30 days per year thereafter.
- Probation
- 90 days (extendable to 180 by agreement)
- Overtime rules
- 150% of hourly rate for overtime. Friday is the weekly rest day.
Tax overview
- Income tax range
- 0% (no personal income tax for residents)
- Corporate tax
- 20% (foreign-owned); zakat (2.5%) for Saudi-owned
- Social contributions
- GOSI: 2% employee + 12% employer (Saudi nationals). 2% employer only for non-Saudis.
- VAT / GST
- 15% (tripled from 5% in 2020)
- Tax year
- Hijri calendar or Gregorian
- Treaty network
- Over 40 tax treaties
Compliance landscape
- Worker classification
- Saudi Labour Law governs. Freelance permit (work permit for self-employment) introduced under Vision 2030.
- Data protection
- Personal Data Protection Law (PDPL, effective September 2023). SDAIA (Saudi Data and AI Authority) initially oversees.
- Right to work
- All foreign workers require employer-sponsored work visa (iqama). Kafala (sponsorship) system being reformed under Vision 2030.
- Non-compete
- Enforceable under Saudi Labour Law. Must be reasonable in time, place, and type of work.
- Collective bargaining
- Trade unions are not permitted. Labour disputes handled by Labour Courts.
Payment rails
SARIE (Saudi Arabian Riyal Interbank Express) is the RTGS system. SAR is pegged to USD. STC Pay and mada (debit) are widely used domestically.
Key considerations for hiring
- Saudization (Nitaqat) quotas require minimum percentages of Saudi nationals per industry and company size
- Vision 2030 is transforming the economy: massive investment in tech, tourism, entertainment, and NEOM
- No personal income tax but 15% VAT and Saudization compliance add complexity
- Riyadh is positioning itself as the regional tech and business hub, attracting MNC regional HQs
Business and cultural context: Saudi Arabia
Business culture
Hierarchical and relationship-driven. Personal trust precedes business deals. Arabic hospitality (coffee, dates) is important. Gender dynamics in the workplace are evolving rapidly under Vision 2030.
Key industries
Talent pool strengths
Historical context
Saudi Arabia's Vision 2030, launched in 2016 by Crown Prince Mohammed bin Salman, aims to diversify the economy away from oil dependence. The plan includes NEOM (a $500B future city), entertainment liberalisation, tourism expansion (Red Sea Project), and Saudization of the workforce. This transformation is creating enormous demand for skilled workers across sectors.
Ready to hire in Saudi Arabia?
Use our EOR service from $399/month and we handle employment law, payroll, tax and compliance in Saudi Arabia for you.