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Limited Liability Company (LLC)

شركة ذات مسؤولية محدودة

Constitución de empresa en Saudi Arabia

Best Answer

The LLC is best suited for: Foreign companies entering the Saudi market with a MISA licence, Joint ventures between foreign and Saudi partners, SMEs targeting Saudi consumers, government contracts, and B2B services, Companies aligned with Vision 2030 priority sectors. Foreign investors pay 20% corporate income tax on their share of Saudi-source profits. Saudi and GCC nationals pay Zakat at 2.5% of the Zakat base (roughly net worth) instead of corporate tax. Mixed-ownership companies split profits proportionally between the tax and Zakat regimes. VAT applies at 15% on most goods and services (raised from 5% in July 2020). Withholding tax applies on payments to non-residents: 5% on dividends, 5% on interest, 15% on royalties and management fees (rates reducible under double tax treaties). Transfer pricing rules follow OECD guidelines.

Who this is for

Foreign companies entering the Saudi market with a MISA licence
Joint ventures between foreign and Saudi partners
SMEs targeting Saudi consumers, government contracts, and B2B services
Companies aligned with Vision 2030 priority sectors

Datos clave

Accionistas mín.1

Accionistas máx.50

Directores mín.1

Capital mínimoNo statutory minimum for Saudi-owned LLCs; SAR 500,000 commonly required for foreign-invested LLCs (sector-dependent)

ResponsabilidadLimited liability

Plazo de constitución2–6 weeks

Costo anualSAR 30,000 – 150,000+ depending on sector, office, and compliance requirements

Proceso de constitución paso a paso

Obtain a MISA foreign investment licence

Apply to the Ministry of Investment (MISA, formerly SAGIA) for a foreign investment licence. The application requires a business plan, financial projections, details of the proposed activity, and proof of the parent company's financial standing. MISA reviews the application and issues the licence for approved activities.

Reserve a company name and draft the Articles of Association

Reserve your preferred company name through the Ministry of Commerce (MoC) portal. Draft the Articles of Association specifying shareholders, capital structure, management, and business activities. The articles must comply with the Saudi Companies Law.

Notarise the Articles and register with the Ministry of Commerce

Have the Articles of Association notarised and submit the full registration package to the MoC. This includes the MISA licence, notarised articles, shareholder details, and proof of capital. The MoC issues the Commercial Registration (CR).

Register with ZATCA and obtain a tax identification number

Register with the Zakat, Tax and Customs Authority (ZATCA) for corporate tax (foreign investors) or Zakat (Saudi/GCC nationals), and for VAT if expected turnover exceeds SAR 375,000. Obtain the company's tax identification number.

Open a corporate bank account and deposit capital

Open a corporate bank account at a Saudi bank (Al Rajhi, SNB, Riyad Bank, SABB). Deposit the required share capital. Banks require the CR, MISA licence, articles, and passport copies of shareholders.

Obtain municipal licence and commence operations

Apply for a municipal licence from the relevant municipality (Baladiya) for your business premises. Register with the General Organisation for Social Insurance (GOSI) if hiring employees. The company can begin trading once all licences are in place.

Documentos requeridos

MISA foreign investment licence
Passport copies of all shareholders and directors (attested)
Notarised Articles of Association
Parent company financial statements (for foreign-invested entities)
Board resolution authorising the Saudi investment
Business plan and financial projections
Office lease agreement
Power of Attorney (notarised, apostilled, and legalised by the Saudi embassy)

Resumen de costos

Cost Breakdown (USD)

Costo anual

SAR 30,000 – 150,000+ depending on sector, office, and compliance requirements

Costo de constitución

SAR 20,000 – 100,000 ($5,300 – $26,600)

Tratamiento fiscal

Foreign investors pay 20% corporate income tax on their share of Saudi-source profits. Saudi and GCC nationals pay Zakat at 2.5% of the Zakat base (roughly net worth) instead of corporate tax. Mixed-ownership companies split profits proportionally between the tax and Zakat regimes. VAT applies at 15% on most goods and services (raised from 5% in July 2020). Withholding tax applies on payments to non-residents: 5% on dividends, 5% on interest, 15% on royalties and management fees (rates reducible under double tax treaties). Transfer pricing rules follow OECD guidelines.

Ventajas y desventajas

Advantages

Access to the largest economy in the MENA region (GDP ~$1 trillion)
100% foreign ownership available with MISA licence — no Saudi partner required
Vision 2030 has created massive infrastructure and privatisation opportunities
Government procurement contracts are substantial and growing
No personal income tax for employees or shareholders
Strategic gateway to the wider GCC market

Disadvantages

20% corporate tax on foreign investors is higher than UAE (9%) or Bahrain (0%)
MISA licence process adds weeks to the formation timeline
Saudisation (Nitaqat) requirements mandate minimum percentages of Saudi employees
Regulatory environment is improving but still complex for first-time entrants
Physical office and local staff are expected — virtual setups are not well received
Cultural and relationship dynamics require genuine local engagement

Otras estructuras en Saudi Arabia

Joint Stock Company (JSC)

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This content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.