Nitaqat Wage Floor: SAR 5,000 Then SAR 6,000 in 2026 | Hespah LLC [Skip to main content](#main-content)[![Hespah LLC](https://centralcdn.hespah.com/home_logolight_file2png.webp)](/en)Search More [Home](/en) [Learning Hub](/en/courses) [About us](https://hespah.com/who-we-are) [Blog](/en/blog) [Contact Us](/en/contact) Login[New Account](/en/register) 1. [Home](/en) / 2. [Blog](/en/blog) / 3. Nitaqat Wage Floor Rises to SAR 5,000 Then SAR 6,000 Nitaqat Wage Floor Rises to SAR 5,000 Then SAR 6,000 ==================================================== 2026-10-26 / 1 day ago What changed in the Nitaqat wage floor -------------------------------------- The Custodian of the Two Holy Mosques, on the recommendation of the Crown Prince and Prime Minister, directed that the Nitaqat wage floor required to count a Saudi employee in full towards Saudisation ratios rise to **SAR 5,000** six months after the measure starts, then to **SAR 6,000** twelve months after the first increase begins. Its date is Sunday 14 Jumada al-Ula 1448 AH, that is 25 October 2026, and its text sits in the Umm Al-Qura gazette. It did not come alone. Alongside it is a package of citizen support measures timed with the announcement by Saudi Power Company and the National Water Company of amendments to consumption tariffs from 1 January 2027. ![The two stages of the Nitaqat wage floor increase and their timing](https://centralcdn.hespah.com/uploads/emils/17930149640.jpg) What the Nitaqat wage floor means for a business in practice ------------------------------------------------------------ The governing word here is "in full". A Saudi paid below the Nitaqat wage floor enters the count short, so the firm's Saudisation ratio slips and may drop it a band. This number is therefore a line in the band equation before it is a line in the payroll run. A drop in band is not read in the income statement. Its real home is visas, transfer of sponsorship and work permit renewals: disruption before cost. Anyone reading the directive as a pay rise has seen half of it. A business that hires seasonally feels it first, because every hire it makes passes through the band. The timetable for raising the Nitaqat wage floor ------------------------------------------------ Stage Wage floor Timing First stage SAR 5,000 Six months from the date the measure starts Second stage SAR 6,000 Twelve months from the start of the first increase One point deserves attention: the text ties both stages to "the date the measure starts" and does not fix that date to a calendar day. The table above is therefore relative, not absolute, and no budget should rest on an assumed date before the competent authority issues the implementation mechanism. First wait for the date, then build the schedule. ![The support package announced alongside the Nitaqat wage floor increase](https://centralcdn.hespah.com/uploads/emils/17930149651.jpg) The rest of the support package ------------------------------- - **A monthly allowance of SAR 500:** for civil and military employees on civil service scales and operating programme items, for retirees, and for family members of a deceased contributor or retiree covered by the social insurance system. - **Monthly support of SAR 500:** for families benefiting from social security, under the mechanisms and rules governing it. - **Electricity and water tariffs:** amendments to consumption tariffs beginning 1 January 2027. The first two items concern the public sector and social security, so they carry no direct effect on a private-sector payroll. A private business therefore reads the package through two items only: the Nitaqat wage floor, and the tariff amendment. The tariff change enters the operating cost of every firm with branches, warehouses or plants, and its effect begins with the first billing cycle of 2027. What to do now -------------- 1. **Pull a list of everyone paid under SAR 5,000.** First this list, because it is the size of the problem, and without it every cost estimate is a guess. 2. **Recalculate the Saudisation ratio at both thresholds.** Run it once at 5,000 and once at 6,000, and compare the resulting band in each case. Also record today's band, so you know later how much moved. 3. **Size the annual gap.** The difference between current pay and the new floor, multiplied by headcount and by twelve months, besides the employer share of social insurance contributions. 4. **Separate cost from operational effect.** The Nitaqat wage floor hits two things: payroll expense, and the firm's ability to hire and obtain visas. The first is measured in riyals, the second in delay. 5. **Put both items in the 2027 budget.** Also put the electricity and water tariff change into the utilities line. 6. **Watch for the implementation mechanism.** The start date is what turns this directive into a dated obligation. Still, do not wait for it to start counting, because the figures are already here. Why this concerns the accountant, not only the HR manager --------------------------------------------------------- Counting an employee in Nitaqat rests on the registered wage, and the registered wage comes out of the payroll run the accountant prepares. So the Nitaqat wage floor is read from your own books before it is read anywhere else. Any gap between what is actually paid and what is registered with social insurance feeds straight into the Saudisation ratio. Besides the pay difference, the social insurance contribution base rises and the employer share rises with it. Whoever counted the difference alone counted short. And anyone working on tax compliance knows payroll expense weighs on [the difference between zakat, income tax and corporate tax](https://hespah.com/en/blog/zakat-vs-income-tax-saudi), while a shift in the cost structure shows up in [preparing and filing the VAT return](https://hespah.com/en/blog/vat-return-filing-saudi-arabia) as purchases and expenses change. Still, the Nitaqat wage floor is a labour regulation, not a tax decision, so do not mix its budget effect with the obligations you manage through [the Zakat, Tax and Customs Authority and the route for objecting to its decisions](https://hespah.com/en/blog/zatca-objection-appeal-process). Frequently asked questions -------------------------- ### When does the SAR 5,000 Nitaqat wage floor take effect? The text says "six months from the date the measure starts" and does not fix that date to a calendar day. Nor was an implementation schedule published with it. So a business waits for the competent authority to issue the mechanism before fixing any date. ### Does the directive make Saudi salaries below SAR 5,000 a violation? The directive addresses the threshold required to count a Saudi employee in full towards Saudisation ratios under the Nitaqat programme. It is a counting condition within the band, and the effect falls on the firm's ratio. Still, a business should review its contracts, because the band it sits in governs its services with the authorities. ### Does the SAR 500 monthly allowance cover private-sector employees? No. In the text of the directive the allowance covers civil and military employees on civil service scales and operating programme items, retirees, and family members of a deceased contributor or retiree, together with monthly support for families benefiting from social security. ### Does the Nitaqat wage floor change once or in two stages? In two stages: SAR 5,000 six months from the start of the measure, then SAR 6,000 twelve months from the start of the first increase. So a business faces two jumps rather than one, and each jump deserves its own estimate. ### When do the new electricity and water tariffs begin? From 1 January 2027, under the announcement by Saudi Power Company and the National Water Company that coincided with the directive. Sources ------- - Umm Al-Qura gazette, 25 October 2026: [The Custodian of the Two Holy Mosques, on the recommendation of the Crown Prince, directs a number of measures supporting citizens](https://www.uqn.gov.sa/news/custodian-of-the-two-holy-mosques/4002216) *This article was published on 26 October 2026 and relies on the text of the directive published in the Umm Al-Qura gazette on 25 October 2026.* *This article is for general information only and does not replace reviewing the official sources or consulting a specialist before taking any action.* Articles you might like ----------------------- [![UAE e-Invoicing: the Provider Deadline Falls on 30 October](https://centralcdn.hespah.com/263/conversions/cover-sm.webp)2026-10-26 ### UAE e-Invoicing: the Provider Deadline Falls on 30 October E-invoicing in the UAE: appoint an accredited service provider by 30 October 2026 if revenues reach AED 50 million; go l](/en/blog/uae-einvoicing-asp-deadline)[![Reclaiming VAT on Real Estate Supplies: a 30-Day Window](https://centralcdn.hespah.com/181/conversions/cover-sm.webp)2026-10-14 ### Reclaiming VAT on Real Estate Supplies: a 30-Day Window ZATCA Board Resolution 10-04-26, published 13 October 2026, opens a VAT refund on real estate supplies made by individua](/en/blog/vat-real-estate-supplies-refund)[![ZATCA Objection: The Full Appeal Path, Step by Step](https://centralcdn.hespah.com/138/conversions/cover-sm.webp)2026-10-06 ### ZATCA Objection: The Full Appeal Path, Step by Step A ZATCA objection runs on deadlines: 60 days to file a grievance, 90 for ZATCA to rule, 30 to settle or litigate. 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