Cost of Living in Saudi Arabia
What a month actually costs, with rent and salary context
There is no personal income tax on salaries, which is the central financial fact of living in Saudi Arabia, but value added tax applies to most goods and services and a monthly levy is charged for sponsored dependants. Housing is the dominant expense in Riyadh and Jeddah, schooling is a large cost for families, and packages that include accommodation and school fees change the calculation entirely.
| Personal income tax | None on employment income source |
| Value added tax | Charged at 15% on most goods and services source |
| Dependant levy | A monthly fee for each sponsored dependant |
| Housing | The largest single cost, commonly paid annually or in a small number of instalments |
| Official statistics | Consumer price and wage data published by the statistics authority source |
An indicative monthly budget, one person
| Item | Riyadh (SAR) | Smaller city (SAR) |
|---|---|---|
| Rent, one-bedroom apartment | 3,500 | 2,000 |
| Utilities and internet | 500 | 420 |
| Groceries | 1,300 | 1,100 |
| Transport, including a modest car cost | 900 | 800 |
| Mobile phone | 110 | 110 |
| Total before discretionary spending | 6,310 | 4,430 |
The tax picture
Salaries are not subject to personal income tax, so gross and net pay are broadly the same figure for an employee. Social insurance contributions apply on a different basis for foreign employees than for nationals, and the terms should be confirmed against the contract.
Value added tax is charged at a standard rate of 15% on most goods and services, which raises the cost of everyday consumption relative to countries where the equivalent rate is lower. Municipal and service fees apply in various contexts, and the dependant levy operates as a recurring household charge for families.
What moves the total most
- Housing. Rents in central Riyadh and Jeddah have risen markedly, and annual or semi-annual payment in advance is common, which creates a cash-flow requirement on arrival.
- Schooling. Foreign families overwhelmingly use private international schools, and fees are commonly the second-largest line after rent.
- The dependant levy. Charged monthly per dependant, it scales directly with family size.
- Transport. Cities are built around driving, fuel is inexpensive, and public transport is limited outside the newer Riyadh metro network.
- Cooling. Summer electricity bills are considerably higher than winter ones across most of the country.
Salaries in context
Pay is highly compressed outside senior roles and varies sharply by occupation and nationality. Senior specialists in medicine, engineering, energy and project management are commonly paid at levels that compare well internationally once the absence of income tax is taken into account, particularly where housing and schooling allowances are included.
Below that band, pay for routine roles is low and the tax-free element does not offset it. Published statistics on average wages and consumer prices are available from the statistics authority and are a more reliable reference than salary figures circulated informally.
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Official sources
Checked against these pages in September 2026. Fees and processing times change without notice — confirm before you act.