Dynamo. The business engine.
Saudi employees who first joined social insurance on or after 3 July 2024 pay a rising annuities rate, and so do their employers. Here is who is affected, the rate each year and a worked month.
DynamoOS team6 min read
Free tool
Work out your own figures in seconds, free and without signing up.
The new Social Insurance Law came into force on 3 July 2024. Its contribution rates apply to Saudi employees who had no contribution period before that date, in practice people joining the workforce for the first time. Anyone who had already contributed before 3 July 2024 stays on the old rates, including when they move to a new employer.
So the question for each new Saudi hire is not when they joined your company, but whether they had ever been registered with GOSI before 3 July 2024. A graduate starting their first job is on the new system; an experienced hire coming from another company usually is not.
On the new system the annuities rate started at 9% from the employee and 9% from the employer. It rises by half a percentage point on each side every 1 July from 2025, until it reaches 11% from each side in 2028. The other branches, unemployment insurance and occupational hazards, stay as they are.
| From | Annuities, employee | Annuities, employer |
|---|---|---|
| 3 July 2024 | 9% | 9% |
| 1 July 2025 | 9.5% | 9.5% |
| 1 July 2026 | 10% | 10% |
| 1 July 2027 | 10.5% | 10.5% |
| 1 July 2028 | 11% | 11% |
Every step takes effect on 1 July, so the July payroll is the one to check each year. A rate that is still on last year's figure in July means the contribution list will not match GOSI's invoice.
For a Saudi employee on the new system from 1 July 2026, the employee pays 10% for annuities and 0.75% for unemployment insurance, 10.75% in total. The employer pays 10% for annuities, 0.75% for unemployment insurance and 2% for occupational hazards, 12.75% in total, all on the contributory wage.
| Branch | Old system, employee | Old system, employer | New system from 1 July 2026, employee | New system from 1 July 2026, employer |
|---|---|---|---|---|
| Annuities | 9% | 9% | 10% | 10% |
| Unemployment insurance | 0.75% | 0.75% | 0.75% | 0.75% |
| Occupational hazards | None | 2% | None | 2% |
| Total | 9.75% | 11.75% | 10.75% | 12.75% |
The contributory wage is the same on both systems: the basic wage, with commissions counted as basic, plus the cash housing allowance. If housing is provided in kind, it counts as two months' basic wage a year, a sixth of the basic wage each month. Overtime and bonuses are left out.
The contributory wage is capped at SAR 45,000 a month, with a floor of SAR 1,500 for Saudi employees. For occupational hazards the floor is SAR 400. Under GOSI's rules, contributions are based on the wage the employee receives in the month of Muharram or January each year, so a mid-year pay rise is reported to GOSI rather than picked up automatically.
Decide which system the employee is on, find the contributory wage, then apply the rates in force for the month. The rates change on 1 July, so take them from the month you are paying, not the month the employee joined. A check against the free GOSI calculator before the first payroll catches most mistakes.
Take a Saudi graduate in their first job, on a basic wage of SAR 8,000 with a cash housing allowance of SAR 2,000. The contributory wage is SAR 10,000. From 1 July 2026 the employee pays 10.75% and the employer 12.75%, against 9.75% and 11.75% for a colleague on the old system with the same pay.
| Amount on a contributory wage of SAR 10,000 | New system from 1 July 2026 | Old system |
|---|---|---|
| Deducted from the employee | SAR 1,075 | SAR 975 |
| Paid by the employer | SAR 1,275 | SAR 1,175 |
| Total to GOSI | SAR 2,350 | SAR 2,150 |
The difference is SAR 100 a month on each side, one point of annuities on SAR 10,000. It grows by another half a point each July until 2028, so budget for it when you plan salaries for the year.
According to GOSI's employer guidance, a new employee must be registered within the first fifteen days of the month after the month they started work, and contributions for each month are paid within the first fifteen days of the following month. When an employee leaves, GOSI is told within the first fifteen days of the next month.
If one of the last five days of the payment period is an official holiday, GOSI extends the deadline by the same number of days, up to five.
Dynamo Payroll calculates GOSI contributions on every salary slip, on the old or the new system for each employee, with the yearly steps as settings. It prepares the monthly contribution list for you to review and upload yourself in GOSI Business, so you can check it against GOSI's invoice before paying.
No. Someone who contributed before 3 July 2024 keeps the old rates when they move to another employer. Only people with no contribution period before that date are on the new system.
No. For a non-Saudi employee the employer pays 2% for occupational hazards, and nothing is deducted from the salary.
On 1 July each year until 2028: 10.5% a side from 1 July 2027 and 11% a side from 1 July 2028.
Yes. Contributions on both systems are worked out on at most SAR 45,000 of contributory wage a month.
The rules in this article come from these official sources, read on the day it was published.
Sick leave runs on a yearly scale of full, three-quarter and unpaid days, and maternity leave is now twelve weeks on full pay. Here is how to apply both rules and pay them correctly.
6 min read
Read the article
The amendments in force since 19 February 2025 touched probation, notice, resignation, family leave, maternity leave, overtime and contracts. Here is what changed and what to update in your HR files.
8 min read
Read the article
The same years of service can be worth the full award, a fraction of it or nothing, depending on how the contract ends. Here is how to tell which case you are in and how to work out the amount.
7 min read
Read the articleStart a 14-day free trial with every app, no card needed.
