Working in Jeddah?
Jeddah: Jobs, Salaries, Social Security
The Job Search: Tricks of the Trade
Lots of expats working in Jeddah arrive in Saudi Arabia as part of an intra-company transfer. Others plan on going to the country on their own. Some would like to gain some professional experience in the Middle East, while some feel the lure of a tax-free salary beckon. If you are looking for work in Jeddah, there are several strategies you might give a try.
There are dozens of general consulates in the city, many of which have an office dedicated to business promotion. If you contact the consulate, they may be able and willing to give you a list of Jeddah-based companies affiliated with your home country. The foreign chambers of commerce in Saudi Arabia often provide membership directories for a fee. In this way, you can secure the contact details of various companies in the Jeddah area.
You can also ask the foreign business associations in town or the Jeddah Chamber of Commerce for a similar favor. Quite a few local businesses are, however, family-owned Saudi SMEs. They may not be that interested in hiring an unknown foreigner. If they prove willing to make an exception for you, a decent knowledge of Arabic is a must.
You will have the edge over your competitors if you have specialist knowledge in a specific field or if you are acquainted with the market, laws, language, and culture of Saudi Arabia’s major trading partners. Lots of imports that pass through Jeddah’s port come from China, Germany, India, Japan, South Korea, Switzerland, Turkey, the UAE, and the United States. Also, foreign financiers from these countries and other nations, e.g. the Netherlands, the UK, or Gulf Cooperation Council member states have invested heavily in Saudi companies. Expats from these states may have certain advantages during the job search.
Prices and Perks
Once you have an employment offer for Jeddah, you should take some time to review your contract. Not only do you need an official translation of the Arabic original, but you should also pay attention to your salary and perks. The local cost of living in Jeddah is lower than in many other cities throughout the Middle-East. However, since a lot of expats do move there for financial reasons, they want to earn more than just enough to make ends meet. Although the period of generous expat packages seems to be more or less over, there are three aspects of your remuneration where negotiating can pay off.
First, most employers offer their expat employees a health insurance policy for Saudi Arabia. Take the time to read the fine print of your insurance plan very carefully. Our guide to healthcare for expats in Jeddah lists some things to watch out for. If you consider the proposed healthcare package insufficient for you and your family, get back to your employer on this matter.
Second, expat housing is mostly limited to compounds, which are more expensive than normal accommodation. Although Jeddah is in the midst of a property boom, the current property shortage means that rental costs are high and keep rising. A two-bedroom compound apartment costs at least SAR 110,000 per year. Depending on the size and amenities of your new home, you can easily spend twice as much. Make sure that a substantial part of these expenses is covered by a housing allowance.
Lastly, expatriate families with older children usually send them to international schools. Again, this is a costly endeavor. For instance, tuition fees for the American International School of Jeddah amount to a maximum of over SAR 62,000 a year. So do not hesitate to ask if you contract includes financial provisions for your kids’ education.
Taxation and Social Security
While working in Jeddah, you do not have to pay a single Saudi Riyal in income tax. However, it is only your income from Saudi sources that remains tax-free. If you have an income back home country – e.g. capital interest or rental yields – it will be subject to that country’s tax laws. Before leaving for Jeddah, you should talk to an international tax advisor about filing your tax returns from abroad and exploring potential options for tax minimization.
Moreover, you should remember that just like public healthcare, Saudi Arabia’s social security system excludes foreign residents. You are not entitled to any old-age pensions or disability benefits, based on living and working in Jeddah. Again, it is best to deal with possible consequences long before your actual move. Get in touch with your social security office and your financial services provider to discuss financial provisions for your retirement years. You will have to save part of your salary in order to compensate for the lack of social security coverage.
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