GOSI Contribution Rate Increases Through 2028: What Saudi Employers Need From Their Payroll System

GOSI's annuities (pension) contribution rate for employees covered under the New Social Insurance Law is not a one-time change — it is a phased schedule stepping up 0.5% every July from 2025 through 2028, for both the employee and employer share simultaneously. A payroll system that hard-codes GOSI as a fixed percentage will silently under-deduct and under-remit starting the first July it misses, creating an underpayment liability that compounds every pay cycle until GOSI's own reconciliation flags the shortfall — typically after several months of accumulated variance.

This post covers exactly what is changing in GOSI's contribution schedule through 2028, which employees the new schedule applies to versus who remains on the unchanged legacy rate, what the rate increase means for employer payroll cost planning, and what a payroll system needs to handle correctly to avoid an underpayment or overpayment error. Over 14+ years of configuring Odoo payroll for Saudi employers, iWesabe has found that GOSI rate transitions are one of the most common sources of silent payroll misconfiguration — not because the rule is complex, but because it requires the payroll system to track two different employee populations on two different schedules simultaneously.

What Exactly Is the GOSI Contribution Rate Schedule Through 2028?

The rate increase applies specifically to the annuities (pension) branch for employees registered under the New Social Insurance Law — both the employee and employer contribution rise together by 0.5 percentage points each July. Occupational hazards (2%, employer-paid only) and SANED unemployment insurance (0.75% each side) remain unchanged across the whole period. Employees who were already registered with GOSI before the New Social Insurance Law took effect on 3 July 2024 stay on the legacy rate structure — their contribution does not change under this schedule at all.

Which Saudi Employees Are Affected by the New GOSI Contribution Schedule?

The phased rate increase applies exclusively to Saudi nationals registered with GOSI for the first time on or after 3 July 2024, under the New Social Insurance Law. Saudi employees who already had a contribution history with GOSI before that date remain on the legacy rate structure indefinitely — their annuities rate does not step up under this schedule. Non-Saudi employees are unaffected by either schedule: they remain on the fixed 2% employer-only occupational hazards rate, with no pension or unemployment branch contribution.

How Much Will the GOSI Rate Increase Raise Payroll Costs for Saudi Employers Through 2028?

For a Saudi employer with a growing share of employees on the New Social Insurance Law — every new Saudi hire since July 2024 falls into this population — the employer-side annuities contribution alone rises from 9.5% to 11% of contributable wages by July 2028, a 1.5 percentage-point increase on top of whatever headcount growth adds. On a payroll base of SAR 10M in annual contributable wages for new-system employees, that step alone adds roughly SAR 150,000 in annual employer GOSI cost between the 2025 and 2028 rates — before accounting for salary growth or additional hires in that population.

• Budget the employer-side annuities cost increase into each fiscal year's payroll forecast, not as a one-time adjustment
• Track the growing proportion of new-system employees as a share of total Saudi headcount — the cost impact compounds as this population grows
• Confirm whether any employee benefit or bonus scheme references GOSI contribution as a variable — the schedule change affects those calculations too

Can Your Payroll System Handle Dual GOSI Contribution Structures at Once?

Most Saudi employers today have a mixed workforce: Saudi employees on the legacy 9% rate hired before July 2024, and Saudi employees on the stepping New Social Insurance Law schedule hired afterward — sitting side by side in the same payroll run. A payroll system needs to identify each employee's registration date and apply the correct rate structure automatically, then update the new-system population's rate the moment each July threshold arrives, without a manual reconfiguration each year. A system that applies one GOSI rate uniformly across the whole Saudi headcount will misstate either the legacy or the new-system employees' contribution the moment the two populations diverge.

How Does Odoo Automate GOSI Contribution Calculations Through the 2028 Rate Changes?

Odoo's Payroll module calculates GOSI contributions per employee based on configurable salary rule parameters, which iWesabe sets up to reference the employee's registration date and nationality automatically — routing legacy-system Saudi employees to the fixed 9% rule and new-system Saudi employees to a rate parameter that can be updated once per scheduled July threshold rather than reconfigured employee-by-employee. The same payroll run generates the monthly WPS bank file and the GOSI contribution report simultaneously, so finance and HR see one reconciled cost figure instead of cross-checking two separate exports.

How Does iWesabe Configure Odoo Payroll for GOSI Rate Compliance?

Tracking two GOSI rate structures across a mixed Saudi workforce, and updating the new-system rate correctly each July through 2028, is configuration on top of standard Odoo Payroll — not custom development. iWesabe has delivered 200+ Odoo implementations across Saudi Arabia and the Gulf over 14+ years, and holds the Best Partner MENA 2023, Highest Revenue KSA 2022/2023, and Top Revenue Achiever KSA 2023/2024 awards from Odoo — the only Saudi partner to hold all three concurrently. Every iWesabe payroll engagement includes a GOSI salary-rule review that confirms the legacy/new-system split is correctly mapped before go-live, and a scheduled check-in ahead of each July rate change so the update is applied on time rather than discovered after a payroll run has already gone out.

iWesabe Editorial Team

Practitioner insights on Odoo ERP, ZATCA compliance, and Saudi enterprise digital operations — written by iWesabe's consulting, finance, and engineering teams.

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