What You Should Know About Iqama?

Being the largest Arab nation, the Kingdom of Saudi Arabia (KSA) is always putting incentives in place to lure international investors to contribute to the local labour force. The Saudi Arabian General Investment Authority was in fact created with this objective in mind.

Each year, millions of immigrants come to Saudi Arabia to work. The iqama assists in managing international employees. It is crucial that you comprehend the following if you’re thinking about applying for an iqama:

;

  • what is the iqama function
  • why it is used
  • the process of applying for the iqama.

What Is the Iqama?

A residency permit is called an iqama.

To enable the employee to work and reside lawfully in the KSA, the local employer applies for and obtains the iqama and work permits. The employer is regarded as the neighbourhood sponsor.

Expats who enter the Kingdom of Saudi Arabia on an employment visa are given an iqama. The employment agreement is only valid for the time period specified on the work permit. There is a possibility to renew the permission after the initial year, which is the existing limit for employment at private businesses.

Why Iqama Is Required?

One of the highest proportions of immigrants living in any nation is found in Saudi Arabia. About 31.8 million people lived there in 2016, including 11.7 million foreigners. The fact that 3 million or so of Saudi Arabia’s 13.8 million employed people are citizens of the country is even more noteworthy. In contrast, more than 75 percent of Saudi Arabia’s workforce was made up of foreign workers.

Since foreigners play such a significant role in Saudi Arabia, the government has tight guidelines for compliance with immigration and labour laws. Employers are essential to this process.

Iqama application process

Many businesses utilise the services of a PEO or other approved organisation to assist with the iqama application procedure because it is frequently difficult.

There are several phases in the procedure.

The sponsoring firm must submit an application for a Block Visa as the initial stage. The Ministry of Labor and Social Development receives the application. This government body sets a certain quota for how many of these sorts of visas it will provide.

If approved, the Ministry of Labor and Social Development grants a permit to the business allowing it to sponsor an employee who is a foreign citizen for a longer period of time, up to one year, with the possibility of renewal.

The Ministry of Labor and Social Development considers a number of factors before approving or

  • the nation of the applicant  
  • nation of origin
  • role in the workplace
  • academic background
  • Relationship between the applicant’s academic credentials and the specific employment function

If the visa is granted, the host firm then receives a Visa Authorization number and a Power of Attorney from the Kingdom of Saudi Arabia’s Ministry of Foreign Affairs.

The prospective worker is required to have a medical examination, obtain a medical certificate from a facility that has been approved, and submit both the work visa application and the medical certificate to the Saudi diplomatic mission in the applicant’s place of residency.

The foreign worker can enter the nation and start working as soon as the work visa is issued. A work visa and iqama application must be filed to the Ministry of Labor and Social Development within 90 days after entry.

The foreign worker must get a departure and reentry permission from the Ministry of Interior if they need to leave and return to the nation while they have a valid work permit and iqama.

Employers in Saudi Arabia are responsible for paying all expenses related to getting and keeping up an international worker’s work visa and iqama. If an employee leaves the firm, the employer is also liable for the cost of the repatriation ticket.

How to Check Iqama

The Ministry of Interior website allows employees to check the status of their visas if they have questions about their visa validity or need to know when their iqama is scheduled to expire. To utilise this service, the recipient of the Iqama must have their Iqama number. This verification can guarantee the KSA visa’s validity.

Regulations Concerning Foreign Workers That Are Changing

Foreign worker restrictions in Saudi Arabia are subject to change, therefore anybody interested in working there or businesses intending to grow here should be informed of these changes.

The nation has put into action the Saudi Vision 2030 plan, which aims to accomplish the following objectives:

  • lowering the reliance of the Kingdom of Saudi Arabia on oil
  • diversifying Saudi Arabia’s economy
  • expanding public sector employment
  • assisting small- and medium-sized enterprises

In accordance with this strategy, the nation is aggressively working to expand job opportunities for Saudi Arabian citizens as well as to raise the proportion of local women in the labour force.

The Ministry of Civil Service has also asked all ministries and governmental organisations to get rid of all foreign employees by the year 2020. The Arab News further claims that Saudi Arabian nationals are the only ones eligible for employment in mall sales positions and 12 other retail categories.

Additionally, the tax code has changed negatively, disappointing foreigners living in Saudi Arabia.

The KSA introduced a new tax in 2017 that is applicable to visitors. Employers in Saudi Arabia individually determine if they want to bear the expense or pass it on to their employees because it is unclear by law who should be liable for the price. In 2019, this cost will be SAR 600 per month. 2020 will see a SAR 800 fee rise for businesses with a large international employee base.

Once they arrive, foreign workers who mentioned dependent family members on their iqama must also pay a fee for each dependant. The following are the monthly rates per dependent:

  • From July 1, 2018 to June 30, 2019 – SAR 200 
  • From July 1, 2019 to June 30, 2020 – SAR 300 
  • From July 1, 2020 and later – SAR 400 

Numerous expats have already fled the nation as a result of these taxes and levies. In the third quarter of 2017, more than 94,000 foreign employees fled Saudi Arabia as a result of the higher levies. The majority of these were from non-fee industries. The tax on expatriates and their dependents is often taken care of by reputable businesses.

Working with a local partner is important

In Saudi Arabia, the immigration and work permit procedures are frequently intricate and drawn out. The approval process sometimes takes many months. Many requests are originally turned down.

A Professional Employer Organization is frequently used by businesses thinking about entering the Saudi Arabian market to help them with this process. While the Professional Employer Organization is regarded as the official employment of record and is responsible for all employer-related liabilities, this option enables a business that has not yet formed a legal organisation in Saudi Arabia to hire locals.

enterprises to expand to a new market within a matter of days, instead of the months or years it takes to form a distinct legal corporation. By reading some of our articles on IqamaExpiry, you may find out more about this choice or alternative methods to collaborate with a local partner.

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