Entering the Saudi Arabian market holds immense promise for both investors and entrepreneurs, but understanding the financial aspects involved in establishing a business is critical for sustained success. As the Kingdom continues its transformative Vision 2030 initiatives, it is rapidly becoming a preferred destination for global firms and startups alike. However, to make the most of this dynamic environment, it is essential to grasp the full scope of costs associated with launching a business in Saudi Arabia.

Whether you're assessing market entry opportunities, evaluating cost structures, or planning capital deployment, this guide provides a comprehensive overview of business setup expenses in the Kingdom as of 2025.

Why Saudi Arabia Is an Attractive Business Destination

Saudi Arabia’s ambitious national vision is fostering an open, innovation-driven economy. Here’s why global businesses are increasingly choosing the Kingdom:

• SAR 54.4 billion in FDI attracted in the first nine months of 2024

  
  

• Strong growth in non-oil sectors: tech, tourism, clean energy, and logistics

  
  

• Streamlined business registration and investor-friendly digital portals

  
  

• Geographic advantage connecting Asia, Europe, and Africa

Estimated First-Year Costs of Starting a Business in Saudi Arabia

Launching a business in the Kingdom involves various initial expenditures. Below is a breakdown of anticipated costs during your first operational year:

• Complete Company Formation: SAR 75,000

  Covers legal setup, government approvals, and compliance documentation.

  
  

• Commercial Licensing and Registration: SAR 3,000 – SAR 8,000

  Varies based on industry classification and business activity.

  
  

• License Renewal: SAR 62,000 annually

  
  

• Digital Portal Renewals: SAR 3,000 – SAR 12,000

  Based on employee count and business structure.

  
  

• Office Rent: SAR 20,000 – SAR 200,000

  Depends on size, location, and type of operation.

  
  

• Visa Fees for Foreign Staff: SAR 12,000 per employee

  
  

• Employee Salaries: From SAR 60,000 annually per position

  Influenced by job role and sector.

These setup costs represent the foundational financial commitment and should be included in early-stage strategic planning.

Ongoing Operational and Compliance Costs

After initial setup, businesses must budget for recurring expenses to ensure compliance and operational continuity in Saudi Arabia:

• Municipal & Sectoral Licenses:

  Fees vary by location and industry requirements.

  
  

• Tax Obligations:

  • VAT: 15%

  • Corporate Tax: 20% for entities with foreign ownership

    
    

• Third-Party Service Providers: SAR 25,000 annually

  For accounting, HR, and administrative outsourcing.

  
  

• Utilities & Office Maintenance: SAR 10,000 – SAR 50,000 annually

  
  

• Mandatory Health Insurance: Starting at SAR 5,000 per employee

  
  

Accurate forecasting of these costs supports better cash flow management and regulatory compliance.

Other Costs to Consider

• Consultancy: SAR 5,000 – 20,000 depending on legal or strategic complexity

  
  

• Recruitment & onboarding: Variable costs for job ads, agency fees, and screening

  
  

• Software & infrastructure: CRM, payroll, ERP tools may cost SAR 10,000 – 50,000 annually

  
  

These “hidden” expenses often surface post-setup and can affect long-term planning if not considered early.

We Support for Your Saudi Operations: Recruitment, Mobilization & Payroll

While your organization may manage company formation separately, the real challenge begins with building and running a capable team in compliance with local regulations.

That’s where Fircroft adds value. We specialize in:

Talent Acquisition (Contract & Permanent)

Local and international recruitment tailored to your industry and operational goals.

Mobilization Services

From visa processing to onboarding, we handle the entire mobilization lifecycle for your workforce.

Payroll Outsourcing

Fully compliant payroll management, WPS setup, and employee benefit administration! ensuring peace of mind for your HR and finance teams.

We work closely with new and established companies to ensure seamless workforce integration across Saudi Arabia.

Start Smart. Scale Confidently.

Entering the Saudi market is an exciting opportunity! but requires the right partners to ensure operational success. While legal formation is one part of the journey, having the right people in place from day one is critical.

At Fircroft, we help you source, onboard, and manage the right talent! faster, smarter, and fully compliant.

Let’s Talk : Connect with our team to explore recruitment and workforce support solutions tailored to your Saudi expansion.

Sources 

• Saudi Arabian General Investment Authority (SAGIA): www.sagia.gov.sa 

• Vision 2030 Official Website: www.vision2030.gov.sa 

• Ministry of Commerce and Investment: www.mci.gov.sa 

• Saudi Gazette Business News: www.saudigazette.com.sa