Russian
English
Company registration in the Kingdom of Saudi Arabia
Law&Trust International provides Company Registration services in Saudi Arabia. The country is a leader in oil and natural gas production. The government is pursuing economic reforms and diversification and encourages foreign investment.
| Cost of registration | VAT | Corporate tax | Payment of Share Capital | Term of company registration |
| From 14725 USD | 15% | 20% | Not required | Up to 3 months |
Table of contents
Main Advantages of Establishing a Company in Saudi Arabia
- Saudi Arabia is implementing reforms in intellectual property protection and investor rights and maintains a stable economic and political situation, which makes it attractive for long-term investment.
- Possibility of 100% foreign ownership in most sectors of the economy.
Legal forms of companies
- Limited Liability Company
- Joint Stock Company
- Limited Partnership
- Sole Proprietorship
- Branch Office
- Representative Office
The Limited Liability Company is one of the most popular legal forms chosen by foreign investors in Saudi Arabia.
Main Stages of Company Registration in Saudi Arabia
-
Company name reservation, acquire the license from MISA, obtain the Commercial Registration (CR)The step involving are the following:
Preparing the required documents.
Applying for a license at the Ministry of Investment for Saudi Arabia (MISA).
Submitting the Article of Association.
Trade name approval.
Applying for Commercial Registration.
-
2.Updating the Commercial Registration (CR) in all Saudi Business AuthoritiesNational Information Center;
Ministry of Interior;
Chamber of Commerce;
Zakat, Tax and Customer Authority ("ZTCA");
WASEL (Saudi Post Office);
HRSD (Ministry of Human Resources and Social Development);
GOSI (General Organization for Social Insurance);
MUQEEM Portal;
QIWA Portal.
Once the above steps are completed, we can assist with the issuance of the General Manager’s residency visa and opening of a company Bank account (upon request):
- Required support with visa documents consultations;
- Filing the application for Visa;
- Assistance with office space search;
- Opening the bank account for the capital deposit of your Company.
Documents required for Company Registration
The following documents are required for the registration process in Saudi Arabia:
- Copies of passports of the founders and directors.
- Proof of residence address of the founders and directors (utility bill, bank statement, etc.) in English.
Specifics of Company Registration in Saudi Arabia
Although there are no minimum statutory capital requirements, in practice MISA often requires foreign LLCs to have a capital of at least SAR 500,000. In some activities, MISA sets a different minimum capital.
The company is required to file tax returns annually. The company's accounts must be audited annually by an auditor licensed to operate in Saudi Arabia and filed with the Ministry of Commerce (MOC).
A physical local office is a requirement. A virtual office is not sufficient.
There are special requirements regarding the nationality of the shareholders. This applies to certain activities that are reserved for Saudi nationals only. The list is published by MISA and changes from time to time.
The company must appoint a general manager resident in Saudi Arabia. Residency is obtained at the final stage of Company Registration. Law&Trust's lawyers and consultants can help you obtain residency for the general manager of the company. You can request a personalized consultation by phone or on the website.
| Minimum amount of authorized capital | No |
| Local registered office | Required |
| Permissibility of foreign ownership | 100%, but there are exceptions depending on the type of activity of the company. |
| Minimum number of directors | 1 |
| Minimum number of shareholders | 1 |
| Personal presence | Not required |
| Residency requirement for directors and shareholders | Director must be a resident of Saudi Arabia. Shareholder requirements vary depending on the type of company's activity. |
Taxation
Although the corporate tax rate is 20%, income derived from the production of oil and hydrocarbons in Saudi Arabia is taxed at rates ranging from 50% to 85%.
For residents, capital gains tax on the sale of shares in a Saudi resident company are taxed at either 2.5% Zakat (a mandatory tax in Islamic law) or at 20% tax, depending on the circumstances. Non-residents selling shares in Saudi companies are generally taxed at a flat rate of 20%. Zakat applies to companies resident in Saudi Arabia and other GCC countries.
The dividend tax rate for non-residents is 5% and the royalty tax rate is 15%.
| VAT (Sales Tax) | 15% |
| Corporate tax | 20% |
| Capital gains tax | 20% |
| Dividend tax | 5% |
| Royalty tax (Withholding Tax Rate) | 15% |
| Personal income tax | 0% |
| Stamp duty | No |
| Currency Control | No |
F.A.Q.
How long does it take to register a company?
From 2 weeks to 3 months, depending on the type of company and selected business activities.
Is it mandatory to have a local partner?
Most industries require 51% domestic ownership, but exceptions have emerged: 100% foreign ownership is allowed in free economic zones, the IT sector, pharmaceuticals and certain types of consulting. In retail and construction, a local partner (kafil) is still required.
How to open a corporate account with a Saudi bank?
Banks require personal presence of beneficiaries with original documents, detailed description of business activities and letters of recommendation. Al Rajhi Bank and SABB are the most loyal to foreigners. The average time to open an account is 3-5 weeks.
Do I need to open an account with a local bank?
Yes, this is a mandatory step to deposit authorised capital and conduct operations.
What restrictions are there for foreign investors?
Industries closed to foreign investment include oil production, military, some types of media. Special authorisation is required for access. Also, foreigners cannot own land outside industrial zones without special authorisation.
