New contributors under the new Social Insurance Law (from 3 July 2024) see their annuities rate rise step by step — explained below.
The three branches
| Branch | Covers | Who |
|---|---|---|
| Annuities | Retirement, non-occupational disability and death | Saudis |
| Occupational hazards | Work injuries and occupational diseases | All workers, Saudi and non-Saudi |
| SANED (unemployment insurance) | Temporary compensation after job loss | Saudis covered by annuities |
Rates for contributors registered before 3 July 2024
| Branch | Employer | Employee | Total |
|---|---|---|---|
| Annuities | 9% | 9% | 18% |
| SANED | 0.75% | 0.75% | 1.5% |
| Occupational hazards | 2% | — | 2% |
| Total (Saudi) | 11.75% | 9.75% | 21.5% |
| Non-Saudi | 2% | 0% | 2% |
SANED was cut from 2% to 1.5% (0.75% each side) from 1 January 2022. The occupational hazards rate can be doubled for employers who ignore health and safety instructions.
The new law: gradual annuities increase
The new Social Insurance Law took effect on 3 July 2024 and applies to new contributors with no contribution periods before that date. It raises the annuities contribution by 0.5% a year for both employer and employee from the second to the fifth year, reaching 11% each instead of 9%. The first step applied from 1 July 2025.
| Period | Annuities (each side) | Employer (with SANED and hazards) | Employee (with SANED) |
|---|---|---|---|
| 3 Jul 2024 – 30 Jun 2025 | 9% | 11.75% | 9.75% |
| 1 Jul 2025 – 30 Jun 2026 | 9.5% | 12.25% | 10.25% |
| 1 Jul 2026 – 30 Jun 2027 | 10% | 12.75% | 10.75% |
| 1 Jul 2027 – 30 Jun 2028 | 10.5% | 13.25% | 11.25% |
| From 1 Jul 2028 | 11% | 13.75% | 11.75% |
The periods after July 2025 follow the published schedule (0.5% a year); check the rate applied to your employee on the GOSI portal. At the time of writing (October 2026) the annuities rate for new contributors is 10% each side.
The contributory wage
- Included: basic wage and cash housing allowance (or the value of housing in kind under GOSI's rules).
- Commissions and sales or profit percentages count as basic wage.
- Cap: SAR 45,000 a month; nothing above it is contributory.
- Contributions are worked out on the wage before deductions such as loans or penalties.
- Due date: within the first fifteen days of the following month.
Worked examples
Example 1: Saudi employee registered before 3 July 2024
Basic 8,000 + housing 2,000 + transport 500. Contributory wage = 8,000 + 2,000 = SAR 10,000 (transport is outside the base).
| Rate | Amount | |
|---|---|---|
| Employer share | 11.75% | SAR 1,175 |
| Deducted from employee | 9.75% | SAR 975 |
| Total paid to GOSI | 21.5% | SAR 2,150 |
Example 2: new Saudi contributor (first registered after 3 July 2024), October 2026
Same SAR 10,000 base: employer 12.75% = SAR 1,275, employee 10.75% = SAR 1,075, total SAR 2,350.
Example 3: non-Saudi employee
Basic 5,000 + housing 1,000 = SAR 6,000. Employer 2% = SAR 120; nothing is deducted from the employee.
Example 4: wage above the cap
A Saudi employee (registered before 2024) with basic plus housing of SAR 60,000. Only SAR 45,000 counts: employer SAR 5,287.50, employee SAR 4,387.50.
Monthly calculation steps
- Classify each employee: Saudi registered before 3 July 2024, new Saudi contributor, or non-Saudi.
- Work out the contributory wage: basic (including commissions and sales percentages) + housing allowance, then apply the SAR 45,000 cap.
- Apply the right rates for each group from the tables above, watching the July step for new contributors.
- Deduct the employee share in payroll and book the employer share as a company expense.
- Reconcile with the monthly GOSI invoice on the portal and pay before the fifteenth of the following month.
How it looks in the books
Using Example 1 (contributory wage SAR 10,000, gross salary SAR 10,500):
| Account | Debit | Credit |
|---|---|---|
| Salaries expense | 10,500 | |
| Employer GOSI expense | 1,175 | |
| Salaries payable (10,500 − 975) | 9,525 | |
| GOSI contributions payable (975 + 1,175) | 2,150 |
The GOSI payable clears when you pay GOSI, and salaries payable when you pay the employee. It also shows the true monthly cost of the employee: 10,500 salary + 1,175 GOSI = SAR 11,675.
Common mistakes
- Calculating on gross pay including transport and other allowances instead of basic plus housing.
- Applying new-law rates to an employee with contribution periods before 3 July 2024, or the reverse.
- Forgetting to update new contributors' rates each July.
- Deducting a share from a non-Saudi employee's salary.
- Ignoring the SAR 45,000 cap.
- Paying after the fifteenth of the following month.
Summary
Saudi employee registered before 3 July 2024: 11.75% employer, 9.75% employee. New contributors: the annuities share rises 0.5% every July to 11% each side in 2028 (10% at the time of writing). Non-Saudi: 2% employer only. The base is basic wage plus housing, capped at SAR 45,000, and contributions are due within 15 days of the following month. For leaving-employee dues, read the end-of-service calculation guide, and see pricing.