Contribution rates to the social insurance system
The social insurance system in the Kingdom of Saudi Arabia witnessed fundamental updates that took effect on July 3, 2024 AD (Dhul-Hijjah 27, 1445 AH). These changes aim to enhance the sustainability of the system and expand its coverage. To gain a deeper understanding of these developments, we will discuss the most important details related to subscription rates and how they affect new and existing subscribers.
Who are the groups covered by the new social insurance system?
New entrants to the labor market who do not have subscription periods in the civil retirement or social insurance systems prior to the effective date of the new system.
As for current subscribers before July 3, 2024, they will continue to be subject to the provisions of previous regulations (civil retirement system or social insurance system) regarding contribution rates and conditions.
New updates to the social insurance system in the Jisr system
1- 21.5% company contribution
Meaning: This option indicates that the entire contribution percentage (21.5%) will be borne by the company alone. There is no employee contribution in this case.
2- 11.75% company contribution and 9.75% employee contribution
Meaning: This option divides the total contribution (11.75% + 9.75% = 21.5%) between the company and the employee.
Company contribution: 11.75% of the employee’s salary.
Employee contribution: 9.75% of the employee’s salary (usually deducted from his salary).
3- 11% company contribution and 9% employee contribution “without support“
Meaning: This option is similar to its predecessor, but specifies that these percentages do not include contribution to the “Sand“ program.
Company contribution: 11% of the employee’s salary.
Employee contribution: 9% of the employee’s salary.
Total contribution (without Sand): 20% (11% + 9%).
Note on “SAND“: “SAND” is the unemployment insurance system in the Kingdom of Saudi Arabia (unemployment insurance system). When you mention “without Sand”, it means that these percentages do not include Sand’s share (which is usually 1% on the company and 1% on the employee out of Sand’s total 2%). This suggests that these contributions may be for retirement or another branch of insurance.
4- 2% company contribution “retired employee“
Meaning: This option is for a special case where the employee is already retired (and receiving a pension) but has returned to work. In this case, the social insurance contribution is often much lower and is borne solely by the company.
Company contribution: 2% of the employee’s salary.
Employee contribution: 0% (no contribution for retired employee returning to work).
5- 12.25% company contribution and 10.25% employee contribution (updated according to the new system dated July 3)
Meaning: This option is another division of the total contribution.
Company contribution: 12.25% of the employee’s salary.
Employee contribution: 10.25% of the employee’s salary.
Total contribution: 22.5% (12.25% + 10.25%).
6- 11.5% company contribution and 9.5% employee contribution “without support” (updated according to the new system dated July 3)
Meaning: This option is similar to option 3, but in slightly different proportions.
Company contribution: 11.5% of the employee’s salary.
Employee contribution: 9.5% of the employee’s salary.
Total contribution (without Sand): 21% (11.5% + 9.5%).
7- 22.5% company contribution
Meaning: This option means that the entire contribution percentage (22.5%) will be the responsibility of the company alone.
Steps to amend the employee’s social insurance registration information:
1- The user enters the employee’s file.
2- Go to tab “Salary and Financial Details”.
3- From the “Social Insurance Details” box, you can click “Edit”
4- From the Contributions field, the user chooses the appropriate contribution for the employee
5- Click on “Save Changes”
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