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SAUDI ARABIA: Expat Levy Expanded
July 5, 2017
Effective 1st July 2017, as expected, a monthly levy of SAR 100 (approximately USD 27) must be paid for each foreign national dependent resident in Saudi Arabia.
In addition, from January 2018, the monthly levy on foreign national employees in companies where the number of foreign national employees exceeds the number of Saudi employees will double to SAR 400.
For the first time, a levy of SAR 300 per month will apply to companies where the number of foreign national employees does not exceed the number of Saudi employees.
Future increases
The levy raised on foreign national employees and dependents will increase in each of the next three years:
Dependent:
2017: SAR 100
2018: SAR 200
2019: SAR 300
2020: SAR 400
Employee of company where the number of foreign national employees exceeds the number of Saudi employees:
2017: SAR 200
2018: SAR 400
2019: SAR 600
2020: SAR 800
Employee of company where the number of foreign national employees does not exceed the number of Saudi employees:
2017: None
2018: SAR 300
2019: SAR 500
2020: SAR 700
How is the levy paid?
The levies for the full duration of the intended residence are to be paid in advance to the Jawazat office (the Ministry of Interior office responsible for new and renewal visas/permits) for each foreign national employee or accompanying foreign national dependent at the time of the initial or renewal Muqeem (residence permit) application. The fee may be paid by the principal applicant or by the sponsoring Saudi entity.
Impact
These increases will significantly raise costs for foreign nationals living and working in Saudi Arabia, and their employers.
Saudi Finance Minister Mohammed Al-Jadaan told reporters in Riyadh on Thursday that these fees do not apply to domestic helpers, such as drivers and cleaners, but only to expats working in commercial entities.
The finance minister also ruled out income taxes on Saudi nationals, foreigners or company revenues.
The levies on expats and dependents are expected to generate 65 billion riyals for the kingdom by 2020.
Our advice
Employers of foreign nationals living and working in Saudi Arabia should review their plans to take into account the new expat levy.
For advice and information on Saudi immigration, please email us at [email protected].
