In Saudi Arabia, the General Organization for Social Insurance (GOSI) plays a vital role in providing comprehensive social insurance coverage to the workforce. As the country’s premier social insurance program, GOSI ensures the financial protection and well-being of both local and expatriate employees and their families. By collecting contributions from employers, facilitating legal social insurance coverage, and disbursing benefits to eligible beneficiaries, GOSI plays a crucial role in safeguarding the economic and social security of Saudi Arabia’s workers.
GOSI Contribution for Expatriates
For expatriate employees, the GOSI contribution rate is fixed at 2% and is entirely borne by the employer. Contributions for expatriates are calculated based on their basic salary and housing allowance, with a maximum base amount of SAR 45,000. If an employee’s basic salary and housing allowance exceed SAR 45,000, GOSI contributions are calculated only on the capped amount.
Calculation of GOSI Contributions
GOSI contributions for Saudi nationals are calculated as a percentage of their basic salary and housing allowance. The total GOSI contribution percentage for Saudi nationals is 21.50%, with the employer and employee each contributing a specific percentage.
Employer’s Contribution:
Unemployment Contribution: 0.75%
Annuity (Pension) Contribution: 9%
Occupational Hazards Coverage: 2%
Total Employer’s Contribution: 11.75%
Employee’s Contribution:
Unemployment Contribution: 0.75%
Annuity (Pension) Contribution: 9%
Total Employee’s Contribution: 9.75%
Comprehensive Benefits Offered by GOSI
GOSI offers an extensive range of benefits designed to protect workers against unexpected events that may impact their financial stability. These benefits include occupational hazards coverage, unemployment insurance, and various annuities such as retirement pensions, non-occupational disability pensions, death pensions, and early retirement benefits. By providing a safety net against income loss due to disability, unemployment, retirement, or the death of a breadwinner, GOSI ensures that workers and their families have access to essential financial support during challenging times.
The Impact and Significance of GOSI
GOSI has emerged as a crucial component of Saudi Arabia’s social welfare system. By providing comprehensive social insurance coverage, GOSI ensures that workers and their families are protected during times of financial uncertainty. Moreover, the program serves as a catalyst for social and economic development by promoting the well-being of the workforce, which is fundamental to the nation’s progress. GOSI’s efficient management and comprehensive benefits have established it as a global benchmark for social insurance programs.
The General Organization for Social Insurance (GOSI) plays a vital role in providing comprehensive social insurance coverage to workers in Saudi Arabia. Through its robust framework, GOSI offers an array of benefits that protect workers and their families from unforeseen circumstances. By calculating contributions based on income and disbursing benefits when needed, GOSI ensures the financial security and well-being of the workforce. As Saudi Arabia continues to prioritize the welfare of its workers, GOSI remains an indispensable institution in providing comprehensive social insurance coverage to employees across the country.
For more information on regulations in Saudi Arabia, contact ACT Corporates Services at solutions@actgroupservices.com or call us on +966 54 039 5188.