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Tuesday, February 28, 2017

What is the Reality behind Notices regarding expats monthly fee?

From quite some time, social media members are receiving messages from their friends or contacts about changes and announcement of new expatriate charges from January 2017 which were fake and were just placed to promote their pages and sites.  The reality about the fees is very different. Saudi Arabia’s policy to establish an expatriate charge from 2017 was confirmed during the budget declaration, with charges of up to SR800 per worker to be phased in by 2020. From next year, the fees of expat workers would be regularly modified and increased with time, providing an extra force for managers to appoint more Saudis. 



A fee on expatriate workers will also be charged. The correct opening date of these fees on expatriate was from July 2017 not from January 2017 and it will be implemented on companies from 2018. Expatriates in the Kingdom are in a puzzled state as well as under pressure because of the upcoming fee structure; particularly those with families are much more concerned and bothered by these kinds of notices. What happens is that this false notice is used by illegal negotiators who explain to people that they must pay certain charges (which are not yet practiced in the Kingdom) to get employment or for those who want to bring their family in the Kingdom, which is a big problem people are facing. 



This fake information causes large monetary loss and affects the normal people. The most important thing that an expatriate should keep in mind is that the new monthly fee for the year 2017 is applicable on dependents only and not on a single person functioning in Saudi Arabia.  Employees should be responsible to pay for their dependents; they should not ask companies to compensate them for this.   Don’t post false notices to anyone until you confirm them from authentic sources like Daily Newspapers or Media websites that are true.



Expatriates living in Saudi Arabia will have to pay SR 1200 per annum for every dependent under his Iqama starting from July 2017. For example, if you have a wife and 3 children, you will have to pay SR 4,800 per annum. Expatriates will have to pay SR 3600 per annum per dependent from July 2019 and; SR 4800 per person per annum from July 2020. It means you must pay SR 19,200 per annum for a wife and 3 children in the year 2020.



The second type of fee is already imposed on expatriate employees which employers must pay if they have less than 50% Saudi employees. The current amount which employees must pay per annum on each expatriate employee is SR 2,400 per annum. Currently, companies who have more  than 50% Saudi employees do not have to pay the fee. However, from the next year, they will have to pay it on a discounted rates. It is expected to increase to SR 4,800 for the year 2018 for those companies who do not employ 50% Saudis. The companies who employ 50% Saudis will have to pay SR 3,600 per employee per annum. For the year 2019, It is expected to increase to SR 7,200 for those companies who do not employ 50% Saudis. The companies who employ 50% Saudis will have to pay SR 6,000 per employee per annum. For the year 2020, It is expected to increase to SR 9,600 for those companies who do not employ 50% Saudis. The companies who employ 50% Saudis will have to pay SR 8,400 per employee per annum.



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