GOSI Explained: What Actually Comes Out of a Saudi Salary

GOSI — the General Organization for Social Insurance — is the line on a Saudi payslip people most often misunderstand. The split between employer and employee, and the cap that limits it, are both worth knowing whether you run payroll or just read your own slip.

The annuity (pension) branch

For Saudi employees, the pension branch contribution is shared: 9% from the employee and 9% from the employer under the existing system. Contributions are calculated on the contributory wage — broadly basic pay plus housing allowance.

The SAR 45,000 cap

The contributory wage is capped at SAR 45,000 per month (Article 19 of the Social Insurance Law). Earn above that, and contributions are still calculated only on the first 45,000. At the cap, the pension contribution is SAR 4,050 from each side.

The cap is why a senior manager and a director earning very different salaries can have identical GOSI deductions.

Occupational hazards

On top of the pension branch, an occupational-hazards contribution of 2% is paid by the employer only. This is the branch that applies to non-Saudi employees too — for whom the pension branch generally does not apply.

New system vs. old

A new Social Insurance Law applies to employees who joined with no prior contribution history, effective mid-2025. Its pension rate starts at 9% each side and steps up by half a percentage point a year until it reaches 11%. Workers already contributing under the previous law continue under the old schedule. The practical effect: two colleagues hired a year apart can be on different contribution tracks.

SANED (unemployment insurance)

SANED is a separate branch covering unemployment. Its rate is set by council decision within a statutory band (between 0.5% and 2%), split equally between employer and employee — so it's worth checking the current operative figure rather than assuming.

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