Company incorporation in Saudi Arabia
Company incorporation in Saudi Arabia, the largest economy in the Middle East, offers strong incentives for foreign investors to establish a local company. Whether you are expanding a manufacturing operation, entering the services sector, or setting up a trading entity, understanding the legal landscape and incorporation process is critical for long-term success.
Common types of business structures for foreign investors
The most common and practical legal structure for foreign businesses is the Limited Liability Company (LLC). This model allows for up to 100% foreign ownership in most sectors and limits liability to the shareholder’s capital contribution. LLCs must have a minimum of two shareholders and one director. However, for some regulated industries, a local Saudi partner may still be required.
Another option is the Joint Stock Company (JSC), which is typically used by larger entities planning to raise capital publicly. JSCs are ideal for businesses seeking long-term growth and public investment, and they also allow foreign ownership under certain conditions.
Steps to set up a company in Saudi Arabia
- Name reservation and SAGIA approval
Choose a company name that complies with Saudi Arabian regulations and apply for investment approval from the Ministry of Investment (formerly SAGIA). - Document filing and registration
File incorporation documents, including Articles and Memorandum of Association, with the Ministry of Commerce and Investment (MOCI). - Capital deposit and licensing
Open a Saudi bank account and deposit the minimum capital (typically SAR 500,000 for LLCs). Apply for a commercial registration and labor file. - Tax and regulatory registration
Register for Zakat and income tax with the Zakat, Tax and Customs Authority (ZATCA), and ensure compliance with Saudization and labor laws.
Tax and withholding overview
Saudi Arabia imposes a corporate tax of 20% on foreign-owned entities. There is no personal income tax, which makes the country attractive for foreign talent. Dividends distributed to foreign shareholders are subject to a 5% withholding tax unless reduced by a double taxation agreement.
Expert support and advisory
Working with local experts is highly recommended to navigate the regulatory landscape efficiently. Gulfinder provides complete support in business incorporation, from strategic structuring and documentation to liaising with government authorities and securing necessary licenses.
Conclusion: Why set up a company in Saudi Arabia?
Company incorporation in Saudi Arabia allows businesses to access the GCC market, bid on government contracts, and strengthen their regional footprint. Gulfinder has helped businesses across manufacturing, technology, food, and services sectors set up legally compliant, operational companies. If you are planning your market entry, reach out to our team to schedule a consultation.