May 19, 2020 2 min read

Saudi Arabia Payroll Outsourcing Alert

Saudi Arabia – Value Added Tax Increases to 15%.
Mercans, a leading KSA payroll outsourcingPEO/GEOemployee leasingrecruitment and BPO services provider, has published KSA payroll outsourcing alert. Subscribe to Mercans’ KSA payroll outsourcing alerts to ensure that you are always up-to-date with the lasted regulatory changes in KSA labor and payroll compliance requirements.

The government of Saudi Arabia has announced that the Value Added Tax (VAT) rate will increase from 5% to 15%, effective from 1 July 2020. All other regulations related to the applicability of VAT, as well as VAT filing and payment processes, will remain unchanged. The increase in the VAT was announced as a part of the government’s efforts to rebalance the state budget and counter the revenue shortfall caused by COVID-19 pandemic.

In addition to the increase of the VAT rate, the government has announced the discontinuation of the cost-of-living allowances paid to civil servants, effective from 1 June 2020.  Also, a ministerial committee has been established to study the financial benefits paid to all employees, contractors and those of similar status whom are not subject to Civil Service Law in government ministries, institutions, authorities, centers, and programs, and present its recommendations within 30 days.

Mercans’ Saudi Arabia Payroll Outsourcing Solutions

While Mercans’ KSA Payroll Outsourcing alerts will allow you to stay on top the latest development in KSA’s payroll regulations, you should still get in touch with Mercans’ KSA payroll outsourcing, compliance, PEO/GEO and BPO specialists for a free consultation on setting up fully compliant payroll and HR functions. Better yet, outsource your payroll and HR activities in KSA to Mercans and our KSA payroll outsourcing experts will ensure that your employees will always be paid on time and in accordance with the KSA regulations.

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