Introduction
Saudi Arabia is rapidly becoming one of the most attractive business destinations in the Middle East. With the Kingdom’s Vision 2030 reforms, foreign investors now have streamlined processes and more incentives to launch operations. However, understanding the true cost of setting up a company in Saudi Arabia in 2025 is essential for planning a successful entry strategy.
This guide provides an updated cost breakdown, including licenses, compliance, hiring, and operational expenses—helping entrepreneurs, startups, and corporations budget effectively.
How Much Does It Cost to Start a Business in Saudi Arabia in 2025?
The total cost to set up a company in Saudi Arabia in 2025 typically ranges between:
- SAR 50,000 – SAR 150,000 ($13,000 – $40,000 USD) for small to medium businesses.
- SAR 300,000+ ($80,000+ USD) for larger corporations with multiple employees and dedicated offices
Total Cost to Set Up a Company …
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These figures vary depending on your business activity, chosen legal structure (LLC, Joint Stock Company, Branch Office, etc.), and location.
Key Cost Components for Company Formation
1. Company Registration & Commercial License Fees
- SAR 1,500 – SAR 5,000 ($400 – $1,334) depending on business activity and legal entity.
2. MISA Foreign Investment License
- SAR 12,000 ($3,200) for initial registration.
- SAR 62,000 ($16,500) for annual renewal
Total Cost to Set Up a Company …
. - This is the most significant cost for foreign investors.
3. Municipal License
- SAR 1,000 – SAR 5,000 depending on city and office size.
4. Office Rental
- SAR 15,000 – SAR 120,000 annually.
- Costs vary from shared co-working spaces to dedicated offices in business districts.
5. Hiring Costs (Mandatory Saudization)
- Hiring Saudi nationals, plus salaries for executives like a General Manager, can cost up to SAR 375,000 annually.
- This is especially relevant due to the Nitaqat Saudization program that enforces local hiring quotas.
6. Compliance & Renewals
- Around SAR 75,000 per year for renewing licenses, labor documentation, and government compliance.
7. Professional Service Fees
- Legal, consulting, and setup support typically add several thousand SAR.
Total First-Year Company Setup Estimate
| Expense Category | Estimated Cost (SAR) |
| Company Registration & License | 1,500 – 5,000 |
| MISA License (Initial + Renewal) | 12,000 + 62,000 |
| Municipal License | 1,000 – 5,000 |
| Office Rental | 15,000 – 120,000 |
| Hiring (GM + Saudis) | Up to 375,000 |
| Compliance & Renewals | ~75,000 |
| Professional Fees | Several thousand |
👉 Total Estimate: SAR 50,000 – SAR 300,000+ (USD $13,000 – $80,000+) in the first year
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Timeline for Company Formation in Saudi Arabia
- 2 weeks to 6 months, depending on:
- Business complexity.
- Type of legal entity.
- Speed of obtaining approvals and licenses.
- Business complexity.
Why Consider Saudi Arabia in 2025?
- Strategic Location: Access to GCC and global markets.
- Economic Growth: Driven by Vision 2030, with new sectors (tech, renewable energy, logistics).
- Investor-Friendly Policies: More sectors are opening to 100% foreign ownership.
- Tax Benefits: No personal income tax and competitive corporate tax rates.
For a comparison, costs in UAE vs Saudi Arabia differ significantly, with KSA offering lower setup fees in certain industries but higher compliance obligations
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Conclusion
Setting up a company in Saudi Arabia in 2025 can cost anywhere from SAR 50,000 to over SAR 300,000 in the first year, depending on your scale of operations. The largest costs are typically the MISA license, hiring, and office space.
If you are considering expansion, it’s best to consult with a professional business setup advisor to calculate exact costs based on your industry.
Ready to expand into the Saudi market? Book a consultation with our experts today to get a customized cost analysis and setup plan.
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