GOSI and payroll software in Saudi Arabia

Short answer: payroll software in Saudi Arabia has to get four things right. GOSI contributions that differ by nationality; Labour Law rules for overtime, leave and end of service; a salary file the employer can submit under the Wage Protection System; and an approval trail that stops anyone changing a run after it is signed off. Software that treats GOSI as one flat percentage is not built for the Kingdom.

Payroll is where a small error repeats every month. This guide covers what GOSI and payroll software should do, the questions worth asking, and how Seen handles each one. It is general guidance. Rates, ceilings and rules change, so confirm current figures with GOSI and with the Ministry of Human Resources and Social Development (HRSD).

How GOSI contributions work

The General Organization for Social Insurance (GOSI) collects monthly contributions from employers and employees. For Saudi employees, contributions cover branches such as pensions, unemployment insurance (SANED) and occupational hazards, with the employer and the employee each paying a share. For non-Saudi employees, the employer generally pays for occupational hazards only.

Contributions are a percentage of a contribution base, usually the basic wage plus housing allowance, and that base has a minimum and a maximum. Rates for Saudi employees who first registered under the newer social insurance rules can differ from those of earlier members and may change over time, so the right rate depends on the person, not only on the month. Good software keeps rates as a schedule with effective dates, not as a number hard-coded somewhere.

What the Labour Law adds

GOSI is only part of the calculation. The Labour Law sets rules that payroll has to follow:

• Overtime paid at a premium over the normal hourly wage
• Annual leave that grows with years of service
• Sick leave paid in tiers depending on its length
• Specific leave types such as Hajj leave, marriage leave and bereavement leave
• An end-of-service award based on length of service and how employment ended

Each rule has details that software either handles or leaves to a person with a calculator. Ask the vendor to show a mid-month joiner, an employee with overtime and an unpaid absence, all in the same run.

The Wage Protection System

Under the Wage Protection System (WPS), employers show that salaries were paid as agreed by submitting salary files through their bank or through the Mudad platform. Payroll software should produce that file from the approved run, with each employee's ID and IBAN. Banks and Mudad publish their own exact formats, so ask whether the vendor's file has been checked against the format you will use.

Approvals and a locked history

Payroll moves money, so the software should separate the person who calculates a run from the person who approves it, and lock the run once it is approved. Corrections should go through a correction run that pays the difference and keeps the original payslip visible, marked as superseded. Ask who can change an approved run. The right answer is no one.

Payroll and the books

Every payroll run creates accounting entries: salary expense, GOSI expense, and the amounts owed to staff and to GOSI. If payroll and accounting are separate systems, someone posts those entries by hand every month. When payroll posts to the ledger by itself, the balance sheet shows what you owe GOSI without a spreadsheet.

Checklist: questions for payroll software

• Does it calculate GOSI separately for Saudi and non-Saudi employees?
• Are the contribution base, floor and ceiling configurable, with effective dates?
• Can it apply different rates to employees registered under newer rules?
• Is overtime calculated from approved hours, with a rate you can adjust?
• Are statutory leave types, such as Hajj leave, built in?
• Is the end-of-service award calculated, and is that live today?
• Does it produce a salary file in WPS format, and has the file been checked against your bank's format?
• Are calculation and approval done by different people?
• Is an approved run locked, with corrections made as separate runs?
• Do payroll entries post to the accounts automatically?
• Are payslips bilingual, and can employees see their own?

How Seen handles GOSI and payroll

Seen runs Saudi payroll in the same system as your HR records and your accounts. Each month's run handles proration for joiners and leavers, overtime from approved timesheets at 150% by default (you can change the rate), absences that HR has decided, and GOSI under Saudi and non-Saudi rules: pension, SANED and occupational hazards, with the floor and the ceiling. Rates are kept as an effective-dated schedule that you can override.

The person who calculates a run cannot approve it, unless an admin approves their own run, and then the run is marked as self-approved by an admin. An approved run cannot be recalculated; corrections go through a correction run. Payroll keeps a history no one can edit or delete. On approval, the run posts to your accounts. Employees see their own payslip on screen, and payslips download as bilingual Arabic and English PDFs.

Seen produces a salary file in WPS format from the approved run. It follows the general WPS layout but has not been verified against any bank's or Mudad's exact format, so check it with your bank. Seen has no direct connection to GOSI, Mudad or Qiwa; you submit through those platforms yourself.

HR records sit right next to payroll: employee documents such as iqama and passport with expiry reminders, contracts, attendance with clock-in and clock-out from the browser, and leave types including Hajj leave with its once-per-employment rule. End-of-service calculation is coming soon.

Every module is in every plan, and employees on payroll are unlimited: you pay only for the people who log in.

Before you decide

Run last month's payroll during a trial and compare it line by line with what you actually paid. Any difference points to a rule the software handles differently. Confirm current GOSI rates on GOSI's website, and Labour Law rules with HRSD.

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