Starting a professional services company in Saudi Arabia is one of the most strategic moves for entrepreneurs, consultants, and specialists looking to tap into the region’s fast-growing economy. With the country’s Vision 2030 initiative, the government is encouraging more foreign investment and private sector participation, especially in legal, accounting, architecture, engineering, IT, and consulting services.
This guide explains everything you need to know to launch your professional services business in Saudi Arabia, including requirements, legal structure, licensing, fees, benefits, and compliance. Whether you are a local investor or a foreign entrepreneur, you will find clear steps to help you get started.
Why Start a Professional Services Business in Saudi Arabia
Saudi Arabia offers a stable, growing economy with large-scale development across all sectors. Professionals in engineering, healthcare, law, architecture, IT, and business consulting are in high demand.
Professional services are vital in helping businesses grow and comply with regulations. The government is welcoming foreign experts through relaxed ownership laws, allowing 100% foreign ownership in many cases.
Key Reasons to Set Up in Saudi Arabia
- Growing demand for quality consultancy and advisory services
- 100% foreign ownership for many professional activities
- No personal income tax in Saudi Arabia
- Access to large government contracts and mega-projects
- Opportunity to serve local and GCC markets
Understanding Professional Services in Saudi Arabia
The professional services sector in Saudi Arabia includes regulated activities that require qualifications and licenses. Some popular business categories include:
- Engineering consultancy
- Legal consultancy
- Financial and accounting advisory
- IT and software development
- Business and management consulting
- Marketing and media consultancy
- Architecture and design firms
- Healthcare advisory services
Each of these activities is classified under specific business codes by MISA (Ministry of Investment of Saudi Arabia), formerly known as SAGIA.
Step-by-Step Guide to Set Up a Professional Services Company in Saudi Arabia
Now let’s walk through the exact process of registering and launching your company.
Step 1: Determine the Right Legal Structure
Choosing the correct legal form is important. For professional services, the most common options are:
- Sole Proprietorship (for Saudis and GCC nationals)
- Limited Liability Company (LLC)
- Foreign Company Branch
- Professional Company (suitable for partnerships between qualified professionals)
If you’re a foreign investor, setting up a foreign-owned LLC or branch office is the most common route. A Professional Company is ideal if the business is owned by licensed professionals with relevant qualifications.
What is a Professional Company?
A Professional Company in Saudi Arabia is a legal entity formed by professionals such as engineers, lawyers, doctors, or consultants to carry out services related to their profession.
Step 2: Apply for MISA Investment License
Foreign investors must first obtain a MISA license to legally operate in the kingdom. This license grants you approval to invest and set up a business in the country.
Documents Required for MISA License:
- Parent company documents (if applicable)
- Board resolution to establish a Saudi entity
- Audited financial statements for the last year
- Passport copies of shareholders
- CV and professional certificates (for consultancy)
Once the MISA license is issued, you can proceed with the commercial registration process.
Step 3: Choose a Company Name and Reserve It
Next, you’ll need to choose a business name in Arabic and English and reserve it with Ministry of Commerce (MoC). The name must align with Saudi naming standards and cannot include offensive, religious, or unrelated words.
Step 4: Draft the Articles of Association (AoA)
The Articles of Association are the founding documents of your business, outlining ownership, operations, and responsibilities. For professional companies, the AoA must include the qualifications and responsibilities of each partner or director.
Step 5: Register with the Ministry of Commerce (MoC)
Submit your company documents and register your entity officially with the MoC. This step will give you a Commercial Registration (CR) — your business license number in Saudi Arabia.
Documents required:
- MISA License
- Articles of Association
- Lease agreement for office space
- Proof of capital contribution
- Shareholders’ identification
Step 6: Open a Corporate Bank Account
Once your CR is issued, you must open a Saudi business bank account in your company’s name. This is required for capital injection, expense management, and employee payroll.
Step 7: Register with ZATCA for Tax and VAT
Even though Saudi Arabia has no personal income tax, businesses must register with ZATCA (Zakat, Tax and Customs Authority). If your revenue exceeds SAR 375,000 per year, VAT registration is mandatory.
You will also need to file:
- Zakat (for Saudi/GCC shareholders)
- Corporate Tax (for foreign ownership)
Step 8: Apply for Municipality License (Baladiya)
Before you begin operations, apply for a municipality license from the local government authority. This confirms your office is approved for business use.
Step 9: Set Up GOSI and Labor Registration
To hire employees, register your company with GOSI (General Organization for Social Insurance) and the Ministry of Human Resources and Social Development (HRSD). This allows you to:
- Issue work permits
- Hire local and foreign staff
- Stay compliant with Saudization (Nitaqat) requirements
Important Compliance and Operational Rules
Running a professional company in Saudi Arabia means following certain rules. You’ll need to meet Saudization quotas, maintain proper financial records, have a registered office space, and follow tax and labor laws. Staying compliant ensures smooth operations, avoids penalties, and builds trust with clients and government authorities.
Saudization Policy (Nitaqat System)
Saudi Arabia mandates that a certain percentage of your workforce must be Saudi nationals. The required percentage depends on the company size and sector. Professional services firms usually fall under white-collar categories, which have higher localization targets.
Office Space Requirement
For most professional licenses, a physical office space is mandatory. Virtual offices are not accepted. Lease documents must be submitted during registration.
Annual Audit and Financial Reporting
All registered companies must submit audited financial statements at the end of each fiscal year. Hiring a licensed Saudi CPA is essential to remain compliant.
Benefits of Setting Up a Professional Services Firm in Saudi Arabia
Establishing a professional company in Saudi Arabia offers a long list of strategic benefits:
- Access to high-value government and corporate contracts
- Open market for foreign consultants
- High margins for expertise-driven services
- Global connectivity through Saudi’s economic cities
- Strong demand in sectors like IT, engineering, healthcare, and education
- Possibility to serve clients across GCC countries
Challenges to Be Aware Of
While Saudi Arabia is opening its doors, some challenges remain:
- Strict Saudization targets
- Arabic documentation and legal compliance
- Need for professional qualifications and certifications
- Lengthy paperwork and legal timelines
- Must hire a local legal advisor for some activities
With the help of a good business setup partner or legal consultant, these challenges can be easily managed.
Best Locations in Saudi Arabia for Professional Companies
Saudi Arabia offers great cities for starting a professional company. Riyadh is perfect for business services, Jeddah suits creative industries, and Dammam is ideal for technical and industrial consulting. Each location has its own advantages depending on your field, helping you reach the right clients and grow faster.
Riyadh
As the capital and business hub, Riyadh hosts many government agencies, large enterprises, and consulting firms. Great for legal, financial, and business advisory services.
Jeddah
Jeddah is ideal for media, architecture, and creative services. It also has a large expat base and growing private sector.
Dammam and Eastern Province
Perfect for engineering, oil & gas consulting, and technical services, due to proximity to industrial zones and ARAMCO projects.
Costs Involved in Setting Up a Professional Company
While the cost can vary based on your license and activity, here’s a rough estimate:
- MISA License Fee: SAR 2,000 to SAR 10,000 per year
- Commercial Registration (CR): SAR 1,200 to SAR 2,000
- Municipality License (Baladiya): SAR 500 to SAR 2,000
- Office Rent: SAR 20,000 to SAR 50,000 annually
- Employee Visa Costs: SAR 5,000 to SAR 7,000 per expat
- Legal & Consultant Fees: Varies
Total setup may range between SAR 40,000 to SAR 100,000, depending on the scope and scale.
Conclusion
Launching a professional services company in Saudi Arabia is an excellent opportunity for skilled individuals and firms looking to serve a growing and sophisticated market. With proper licenses, clear planning, and compliance, you can build a profitable, long-term business that serves both the private and public sectors.
To make the process faster and smoother, it’s always best to partner with a trusted business setup company in Saudi Arabia. This ensures your documents, approvals, and licensing are handled efficiently while you focus on growing your services.
Frequently Asked Questions (FAQs)
Can I own 100% of my company as a foreign investor?
Yes. Many professional services licenses allow 100% foreign ownership, especially if you are qualified and applying through MISA.
Do I need a local partner for a professional services company?
Not always. For most consulting or technical activities, no Saudi partner is required. But for regulated professions (like law), you may need local involvement.
Is it mandatory to have an office in Saudi Arabia?
Yes. You must have a physical office lease to register your professional business.
How long does it take to register a professional company?
The full process can take between 4 to 8 weeks, depending on the documentation, license type, and approvals.
What qualifications are required to open a consultancy firm?
You must have relevant educational degrees, professional experience, and in some cases, certifications related to your service field.
