Establishing a company in Saudi Arabia is the focus of our article today, as the Kingdom boasts the largest economy among Arab nations and ranks among the top 20 economies in the world. For this reason, it offers tremendous opportunities for any entrepreneur looking to establish a company in Saudi Arabia.

Saudi Arabia is not only the world’s largest oil exporter but also a major international commercial hub. Every year, thousands of entrepreneurs from the United States, China, the UAE, India, and many other countries open businesses here.

The Kingdom’s Vision 2030 strategy prioritizes the successful creation of small and medium-sized enterprises (SMEs), along with attracting foreign investment.

Benefits of Doing Business in Saudi Arabia

The country offers several advantages to encourage investors to establish a company in Saudi Arabia:

• Tax Benefits: Foreign investors pay only a 20% corporate income tax on adjusted net profits.

• Supportive Business Environment: Saudi Arabia is open to international visitors and businesspeople, and government initiatives actively promote foreign investment. The friendly local culture also supports commercial activity.

• Innovation: With the goal of becoming a global technology hub, Saudi Arabia has launched various initiatives that aim to grow the tech sector rapidly and generate abundant job opportunities.

• Safety and Quality of Life: Saudi Arabia is considered one of the safest countries in the world—ranking above the UK, Japan, and New Zealand in several safety indices. It has also been recognized as the safest G20 country.

Steps to Establish a Company in Saudi Arabia

To establish a company in the Kingdom, several key steps are required:

1. Official translation of documents

2. Certification in Saudi Arabia

3. Reservation of the company trade name

4. Obtaining approval and licensing from the Ministry of Investment

5. Drafting and publishing the Articles of Association

6. Issuing the commercial registration

7. Appointing and registering the manager’s signature

8. Registering with the Ministry of Human Resources

9. Registering with the General Organization for Social Insurance (GOSI)

10. Registering with Zakat, Tax and Customs Authority

11. Registering on Qiwa and Muqeem platforms

12. Issuing the manager’s visa and residence permit

13. Opening a corporate bank account

For details about governmental requirements, you may refer to the official website of the Saudi Ministry of Investment.

Tax Structure in Saudi Arabia

When you establish a company in Saudi Arabia, taxes are applied based on the company’s legal structure. Corporate income tax applies to all registered companies, including foreign-owned branches. Non-listed companies are subject to a 20% corporate income tax on adjusted net profits.

Profits distributed to non-Saudi or non-GCC nationals are subject to income tax. Meanwhile, profits related to Saudi or GCC nationals are subject to Zakat, a religious levy at a rate of 2.5%.

A withholding tax between 5% and 20% is also applied to payments made for services provided by non-residents.

If you are looking to establish a company in Saudi Arabia, contact us today for a quote:

📞 Phone: +966 50 388 1100
📧 Email: info@bpcpasa.com
🌐 Website: bpcpasa.com

Read also:

Electronic Invoice: Its Requirements and How to Verify It

Corporate Zakat in Saudi Arabia and How to Calculate It

Guidelines for Selective Taxation

Video on the Importance of Accounting and Auditing Financial Statements

Transaction Pricing in Saudi Arabia: The Pricing Guidelines