Dubai announces new stimulus package of AED 500 million

Jay Krishnan, Partner

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HLB HAMT - Accounting Firm in UAE
Phone:- +971 4 327 7775
Mobile:- +971 55 160 1291
Email:- dubai@hlbhamt.com

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    Dubai has come up with yet another economic stimulus package to support the economy and people. The new package amounts to AED 500 million and with this, the total stimulus announced this year sums up to be AED 6.8 billion.

    “Our goal is to help the businesses overcome the challenges caused due to the outbreak of the pandemic and to recover faster to establish a new phase of economic growth”, said Sheikh Hamdan.

    Sheikh Hamdan added, “The private sector is a major partner in Dubai’s progress, and considering the struggles of the different sectors, the stimulus package includes a set of fee exemptions and rent reductions as well as the extension of previous relaxations.”

    He also said, “We are working as a single integrated entity and our prime focus is accelerated recovery. It is important to have a consistent work plan to support all the sectors to help maintain the continuity of businesses, especially for the SMEs. We have to create a more flexible economic environment that can adapt to global changes.”

    According to the new stimulus package, advertising companies have been exempted from advertising permit fees imposed by the Dubai Municipality for 3 months, with a retroactive effect from March 15 to June 16.

    Private nurseries of the Emirate have been exempted from commercial license renewal fees; the clinics in nurseries are also provided with extended licenses. The license of the health professionals working in the nurseries has also been extended for a period of 6 months from the date of expiration. A 50% reduction in rents till the end of the year is given to the nurseries functioning in the premises of the ‘Knowledge Fund Establishment.’

    Sheikh Hamdan has also included amendments to calculate the franchise fee for the taxi sector to enhance the liquidity of operating companies.

    The new stimulus package has extended the validity of some of the initiatives which were announced during the previous stimulus package for an additional three months. The extension includes the 2.5% freeze on market fee and cancellation of all fines charged due to late payment for government services. The payment of penalties will not require the renewal of commercial licenses also (during this period).

    In addition, commercial licenses can be renewed without the mandatory lease contract renewal. 25% of the down payment for paying government fees in installments has been cancelled. The fee for sales and special offers has also been exempted.

    The initiative where the bank or cash guarantee AED 500 for the customs clearance activity will continue to be waived. The bank or cash guarantees which were already paid by the customs clearance companies will be refunded. The fees for the customs documents continue to be AED 5 which was AED 50 for each transaction and the customs complaints processing will be hastened.

    The relaxations for the tourism, entertainment, and events sectors will be extended till the end of the year. The freeze on fees for hotel rating, ticket sales, issuing permits, and the other government fees will all be extended.

    As in the education sector, private schools are being exempted from commercial and educational licenses until the end of the year.

    The temporary entry permit of the artworks loaned from institutions outside the Emirate has been extended till the end of 2020; the artworks which came in by the fourth quarter of 2019 which still remains here are also allowed extension till the end of the year.

    For the tourism and entertainment sector, the initiative to refund hotel establishments and restaurants 50% of the 7% municipality fees charged on sales has been extended till the end of 2020. The “Tourism Dirham Fees” has also been halved for the rest of the year.

    In the international sector, the exemptions of docking fees at Dubai port and Hamriya port for traditional commercial vessels that are registered locally in the UAE have been extended.

    The new stimulus package announced by Sheikh Hamdan has included relaxations for numerous sectors. The aim is to help the economy recover faster. The stimulus packages focus on lending a hand to the struggling businesses, especially the small and medium-sized businesses.

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    Varun R Chandra
    Varun R Chandra
    07:38 25 Apr 21
    HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
    Giuseppe Assi
    Giuseppe Assi
    06:20 31 Jan 21
    I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
    Mohamed Sheriff
    Mohamed Sheriff
    16:16 28 Jun 20
    Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
    218141 JOSEPH THOMAS
    218141 JOSEPH THOMAS
    16:20 23 Jun 20
    Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
    PMI
    PMI
    07:14 23 Jun 20
    In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
    RAVI CHOKSI
    RAVI CHOKSI
    08:28 21 Jun 20
    Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
    Maharajan Subramaniam
    Maharajan Subramaniam
    18:17 06 Jun 20
    High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
    Mohammed L
    Mohammed L
    08:07 05 Jun 20
    We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
    ROY ROSHAN VIVIAN
    ROY ROSHAN VIVIAN
    06:32 04 Jun 20
    Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
    Basil Daniells
    Basil Daniells
    05:55 03 Jun 20
    I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
    Amar Kashyap
    Amar Kashyap
    19:28 02 Jun 20
    Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
    Radz de Jesus
    Radz de Jesus
    16:03 02 Jun 20
    We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
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    Economic Substance Reassessment in UAE

    Jay Krishnan, Partner

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    HLB HAMT - Accounting Firm in UAE
    Phone:- +971 4 327 7775
    Mobile:- +971 50 677 5860
    Email:- dubai@hlbhamt.com

      Get Free Consultation




      UAE businesses, including the ones that had already filed ESR notification, are required to file or re-file ESR notification through MoF’s dedicated portal. It is mandatory to file the ES report within 12 months following the end of the licensee’s financial year.

      The UAE Ministry of Finance (MoF) has published templates for filing notifications and reports. According to the ES notification template, additional details must be provided for the following;

      • All branches of a licensee carrying out relevant activities
      • Confirm if the licensee meets the definition of ‘exempted licensee’ under the new ES Regulations
      • Parent company, ultimate parent company, and ultimate beneficial owners of the licensee

      Below listed are certain key observations about the report;

      • Licensees get the opportunity to explain why CIGAs have not been performed in the UAE (if applicable).
      • The same CIGAs are currently listed in the template for all activities, but it is expected to be rectified later on.
      • Licensees are required to provide the accounting profit/(loss), along with the ‘relevant income’ earned from the relevant activities.
      • It is mandatory to attach financial statements along with the report, but there is no clarity on whether these statements need to be audited or not.
      • Licensees must determine their primary/ main regulatory authority, which becomes difficult when the licensee is carrying on multiple relevant activities which are governed by different regulatory authorities
      • Detailed information must be provided if both the outsourcing providers are involved.
      • Details regarding the parent company, the ultimate parent company, and the ultimate beneficial owners of the licensee must be provided.
      • Differences in the information provided in the notification along with their reasons must be provided in the report.
      • Licensees can also include any additional documentation and information to demonstrate substance if they want to.

      The UAE introduced Economic Substance Regulations last year. The Regulations apply to financial years commencing on or from 1 January 2019. Entities that are within the scope of the Regulations are required to submit an annual Notification form to their Regulatory Authority, and complete and submit to the same Regulatory Authority an Economic Substance Report within 12 months from the end of their financial year Failure to comply with the Regulations can result in huge penalties.

      There have been certain changes to the rules and regulations pertaining to economic substance regulations in the UAE. The UAE Cabinet of Ministers recently issued Cabinet Resolution No. 57 of 2020 that includes a set of amended regulations and all licensees in the UAE are required to re-assess their current ESR classifications and align them accordingly to the latest regulations. Click here to know more.

       

      Would you like to rate us on Google?         

       

      Varun R Chandra
      Varun R Chandra
      07:38 25 Apr 21
      HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
      Giuseppe Assi
      Giuseppe Assi
      06:20 31 Jan 21
      I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
      Mohamed Sheriff
      Mohamed Sheriff
      16:16 28 Jun 20
      Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
      218141 JOSEPH THOMAS
      218141 JOSEPH THOMAS
      16:20 23 Jun 20
      Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
      PMI
      PMI
      07:14 23 Jun 20
      In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
      RAVI CHOKSI
      RAVI CHOKSI
      08:28 21 Jun 20
      Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
      Maharajan Subramaniam
      Maharajan Subramaniam
      18:17 06 Jun 20
      High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
      Mohammed L
      Mohammed L
      08:07 05 Jun 20
      We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
      ROY ROSHAN VIVIAN
      ROY ROSHAN VIVIAN
      06:32 04 Jun 20
      Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
      Basil Daniells
      Basil Daniells
      05:55 03 Jun 20
      I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
      Amar Kashyap
      Amar Kashyap
      19:28 02 Jun 20
      Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
      Radz de Jesus
      Radz de Jesus
      16:03 02 Jun 20
      We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
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      Voluntary VAT Disclosures can Result in Huge Penalties in UAE

      Jay Krishnan, Partner

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      HLB HAMT - Accounting Firm in UAE
      Phone:- +971 4 327 7775
      Mobile:- +971 50 677 5860
      Email:- dubai@hlbhamt.com

        Get Free Consultation




        UAE based businesses will have to pay penalties for voluntary disclosures, from the date of the original VAT return in which the error was made to the date of receipt of payment of the VAT. Initially, penalties on voluntary disclosures were treated as admin fines, and heavier penalties were not imposed for late payments. The ruling by UAE Federal Supreme Court comes as a huge shock for businesses, as the penalties can reach up to 300 percent of the dues.

        The judgment by the Federal Supreme Court will be the first final and conclusive judgment to be issued on penalties for voluntary disclosure. The judgment may affect upcoming decisions to be issued by the various Tax Dispute Resolution Committees and Federal Courts.

        A voluntary disclosure is a form provided by FTA that gives taxpayers an opportunity to voluntarily notify the authority about any error or omission in a previous Tax Return, Tax Assessment or Tax Refund application. A voluntary disclosure must be submitted within 20 business days of the taxpayer identifying an error.

        “It is always better to ensure there aren’t any errors or omissions in the VAT return form, rather than worrying about penalties at a later stage or not disclosing prior period errors to the FTA. VAT plays a significant role on the entire business system and penalties that result from voluntary disclosure can affect cash flow adversely. Hence, it is important to have the right procedures in place’, says Jay Krishnan, Partner at HLB HAMT.

        It has been almost three years since UAE implemented VAT, but the trend of committing errors while filing for VAT is still prevalent among many businesses. HLB HAMT has an exclusive team of trained VAT Consultants who can assist you to steer your business smoothly through the tax laws.

        Would you like to rate us on Google?         

         

        Varun R Chandra
        Varun R Chandra
        07:38 25 Apr 21
        HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
        Giuseppe Assi
        Giuseppe Assi
        06:20 31 Jan 21
        I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
        Mohamed Sheriff
        Mohamed Sheriff
        16:16 28 Jun 20
        Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
        218141 JOSEPH THOMAS
        218141 JOSEPH THOMAS
        16:20 23 Jun 20
        Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
        PMI
        PMI
        07:14 23 Jun 20
        In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
        RAVI CHOKSI
        RAVI CHOKSI
        08:28 21 Jun 20
        Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
        Maharajan Subramaniam
        Maharajan Subramaniam
        18:17 06 Jun 20
        High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
        Mohammed L
        Mohammed L
        08:07 05 Jun 20
        We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
        ROY ROSHAN VIVIAN
        ROY ROSHAN VIVIAN
        06:32 04 Jun 20
        Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
        Basil Daniells
        Basil Daniells
        05:55 03 Jun 20
        I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
        Amar Kashyap
        Amar Kashyap
        19:28 02 Jun 20
        Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
        Radz de Jesus
        Radz de Jesus
        16:03 02 Jun 20
        We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
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        End of service gratuity calculation in KSA

        Sajin Rasheed, Director

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        HLB HAMT - Accounting Firm in UAE
        Phone:- +971 4 327 7775
        Mobile:- +971 50 205 9540
        Email:- dubai@hlbhamt.com

          Get Free Consultation




          Article 84 of the KSA Labor law states as follows regarding end-of-service settlement;

          Upon the end of the work relation, the employer shall pay the worker an end-of-service award of a half-month wage for each of the first five years and a one-month wage for each of the following years. The end-of-service award shall be calculated on the basis of the last wage and the worker shall be entitled to an end-of-service award for the portions of the year in proportion to the time spent on the job.

          Gratuity is a token of appreciation for all the hard work and commitment an employee has shown towards one’s workplace. It is usually calculated at the time of resignation or termination. In KSA, an employee is entitled to an end of service benefit upon completion of two years of service if he is resigning from work. In the case of termination, the employee is entitled to a full accrual if the service period is more than one year.

          Here our payroll experts in KSA, explain in detail the gratuity policy in KSA, along with some sample gratuity calculations.

          What is Gratuity?
          Gratuity is a monetary payment eligible to an employee as a lump sum at the end of his tenure provided that the period of service exceeds one year. Gratuity payment is a liability to the employer which accrues as the employee service period progresses.

          When does the employee become eligible for gratuity accrual?
          Gratuity accrues from the first day of employment up to the last working day. The settlement is dependent on some factors as we will see below.

          Which workers are eligible for gratuity payment?
          Saudi labor law does not specify which workers qualify for gratuity accrual and payment. The law does not say if gratuity should be paid to expatriates only or to both KSA nationals and expats. It is our understanding that gratuity is accrued to all workers in KSA. Please see how gratuity accrual and payment policy in KSA differs from UAE gratuity policy here

          What is the limit for gratuity payable?
          The law does not limit the amount of gratuity that an employee can receive at end of service settlement.

          What is the basis amount that is used to calculate gratuity?
          Gratuity is calculated based on the last paid total wage as at the time of final settlement.

          How is the accrual period determined in calculating gratuity?
          Gratuity calculation is accrued at the following basis

          • If the service period is below five years at half month salary per year.
          • If the service period is more than five years and above at full month salary per year.

          The following simple illustration shows how gratuity accrues in Saudi Arabia.

          Accrual
          Particulars0-5 Years5 Years and Above
          Hire Date01-Jul-1701-Mar-16
          Payroll MonthMar-22Mar-22
          Number of days in Service as of 31st March 20221735.002222.00
          Number of Years in Service4.756.09
          Total Salary1200012000
          One Day salary ( Salary /30)400400
          Gratuity Days
          First 5Years71.3075.00
          6th Year Onwards0.0032.63
          Gratuity Days in total71.30107.63
          Gratuity Amount28,520.55 43,052.05

           

          Factors affecting the amount of gratuity payable in Saudi Arabia

          Articles 85 and 87 define the payable amount based on the separation type and the length of the period of service as seen below.

          Resignation

          Article 85 states as follows ‘If the work relation ends due to the worker’s resignation, he shall, in this case, be entitled to one-third of the award after a service of not less than two consecutive years and not more than five years, to two thirds if his service is in excess of five successive years but less than ten years and to the full award if his service amounts to ten or more years.’

          Under this separation type, the gratuity accrues at the following rate.

          • If the service period is below two years – No gratuity is paid
          • If the service period is above two and below five years – one-third of accrual.
          • If the service is above five years but less than ten years – two-thirds of accrual.
          • If the service period is above ten years – full accrual.

          The following table illustrates such a scenario;

          Resignation
          ParticularsLess than 2 years2-5 Years5-10 Years10 Years and above
          Hire Date14-Aug-2012-May-1710-Feb-1510-Jan-10
          Last working day15-Mar-2218-Mar-2222-Mar-2225-Mar-22
          Number of days in Service579.001772.002598.004458.00
          Number of Years in Service1.594.857.1212.21
          Total Salary12000120001200012000
          One Day salary ( Salary /30)400400400400
          Gratuity EligibilityNone1/3 Of Accrual2/3 of AccrualFull Accrual
          Gratuity Days23.7972.82138.53291.41
          First 5Years0.0024.2750.0075.00
          From 6th Year onwards0.000.0042.36216.41
          Gratuity Days in total0.0024.2792.36291.41
          Gratuity AmountNo Gratuity to be Paid9,709.59 36,942.47 116,564.38

           

          Termination

          When the separation is by termination, the employee is entitled to full accrual if the employee has completed probation.

          Article 87 states as follows; ‘As an exception to the provisions of Article (85) of this Law, the worker shall be entitled to the full award if he leaves the work due to a force majeure beyond his control’.

          Under this separation type, the gratuity accrues at the following rate.

          • During Probation – no gratuity.
          • If the service period is less than five years– half month salary per year.
          • If the service period is above five years – full Accrual.

          The following table illustrates this scenario.

          Termination
          ParticularsDuring ProbationUp to 5 YearsAbove 5 Years
          Hire Date18-Dec-2112-May-1910-Feb-15
          Last working day15-Mar-2218-Mar-2222-Mar-22
          Number of days in Service as of 31st March 202288.001042.002598.00
          Number of Years in Service0.242.857.12
          Total Salary12,000 12,000 12,000
          One Day salary ( Salary /30)400400400
          Gratuity EligibilityNoneFull AccrualFull Accrual
          Gratuity Days3.6242.82138.53
          First 5Years0.0042.8275.00
          From 6th Year onwards0.000.0063.53
          Gratuity Days in total0.0042.82138.53
          Gratuity AmountNo Gratuity to be Paid17,128.77 55,413.70

           

          Is there a specific provision for female employees relating to gratuity?
          Article 87 states that female workers are entitled to full gratuity accrued under the following scenarios.

          • If she terminates her contract within six months after her marriage.
          • If she terminates her contract three months after giving birth.

          When should gratuity payment be done?
          Upon end of service, the employer is mandated to settle the employee’s gratuity and other settlements within a period of one week from the date of end of such a relation. If the employee ends the contract the employer shall settle all the employee entitlements within a period not exceeding two weeks. Any debts and deductions due from the employee may be deducted from his end of service.

          What is the effect of unpaid leave taken during the period of service?
          Any period taken by the employee as unpaid leave is excluded when determining the service period. That means unpaid leave days are excluded when accruing gratuity. The period of service is reduced by the number of days served as unpaid leave.

          How is Maternity unpaid leave and sick unpaid leave treated when determining the service period?
          The period taken as either maternity unpaid leave or sick unpaid leave do count as part of the service period. The period of service is not affected by any period taken during tenure by employees for these two types of leaves.

          Knowing how to calculate gratuity will be highly beneficial to employees and it eradicates any chances of error and confusion. It is equally important to keep yourself updated on any changes in gratuity policies/calculation criteria in KSA.

          For information on the payroll process in KSA click on this link

          Payroll Service in KSA

          The process of payroll is little complicated and time-consuming; hence it is always recommended to outsource your company’s payroll function. Outsourcing payroll will ensure the assistance of a team of trained payroll professionals and it frees up the time of the organization, helping them focus on other projects that add value to their business.

          One should be extra vigilant while selecting their payroll provider, as payroll data is highly sensitive, and one should opt for a provider that can ensure high levels of data security.

          As a leading payroll outsourcing company, HLB HAMT can help solve your payroll complexities through customized strategies. We take care of our clients’ entire payroll cycle that includes preparation of payroll reports, processing salary payment with WPS compliance, accrual management including Gratuity, pension funds, an online portal for accessing payslips, and many more. Our leadership team spends the necessary hours in every project, ensuring our clients get refined consulting services to take your business forward.

          Disclaimer:
          Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.

          Did you find the blog informative?         

           

          Varun R Chandra
          Varun R Chandra
          07:38 25 Apr 21
          HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
          Giuseppe Assi
          Giuseppe Assi
          06:20 31 Jan 21
          I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
          Mohamed Sheriff
          Mohamed Sheriff
          16:16 28 Jun 20
          Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
          218141 JOSEPH THOMAS
          218141 JOSEPH THOMAS
          16:20 23 Jun 20
          Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
          PMI
          PMI
          07:14 23 Jun 20
          In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
          RAVI CHOKSI
          RAVI CHOKSI
          08:28 21 Jun 20
          Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
          Maharajan Subramaniam
          Maharajan Subramaniam
          18:17 06 Jun 20
          High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
          Mohammed L
          Mohammed L
          08:07 05 Jun 20
          We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
          ROY ROSHAN VIVIAN
          ROY ROSHAN VIVIAN
          06:32 04 Jun 20
          Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
          Basil Daniells
          Basil Daniells
          05:55 03 Jun 20
          I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
          Amar Kashyap
          Amar Kashyap
          19:28 02 Jun 20
          Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
          Radz de Jesus
          Radz de Jesus
          16:03 02 Jun 20
          We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
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          Ultimate Beneficial Owner(UBO) Declaration in UAE

          Lavin Nalinababu, Business Consultancy

          image

          HLB HAMT - Accounting Firm in UAE
          Phone:- +971 4 327 7775
          Mobile:- +971 50 677 5860
          Email:- dubai@hlbhamt.com

            Get Free Consultation




            UAE recently replaced Cabinet Decision No. 34 of 2020 with Cabinet Resolution No. 58 of 2020 on the Regulation of the Procedures Related to Real Beneficiaries (“Decision”). According to the new resolution, companies licensed or registered in the UAE (excluding in the financial free zones) must create and maintain a register of their ultimate beneficial ownership(“UBO”) and should submit UBO data to the relevant registrar or licensing authority (“Registrar”).

            Our consultants can assist you with

            • Consultancy related to UBO declaration
            • Maintenance of UBO register
            • UBO record maintenance

            For more details, click here.

            Would you like to rate us on Google?         

             

            Varun R Chandra
            Varun R Chandra
            07:38 25 Apr 21
            HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
            Giuseppe Assi
            Giuseppe Assi
            06:20 31 Jan 21
            I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
            Mohamed Sheriff
            Mohamed Sheriff
            16:16 28 Jun 20
            Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
            218141 JOSEPH THOMAS
            218141 JOSEPH THOMAS
            16:20 23 Jun 20
            Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
            PMI
            PMI
            07:14 23 Jun 20
            In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
            RAVI CHOKSI
            RAVI CHOKSI
            08:28 21 Jun 20
            Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
            Maharajan Subramaniam
            Maharajan Subramaniam
            18:17 06 Jun 20
            High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
            Mohammed L
            Mohammed L
            08:07 05 Jun 20
            We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
            ROY ROSHAN VIVIAN
            ROY ROSHAN VIVIAN
            06:32 04 Jun 20
            Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
            Basil Daniells
            Basil Daniells
            05:55 03 Jun 20
            I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
            Amar Kashyap
            Amar Kashyap
            19:28 02 Jun 20
            Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
            Radz de Jesus
            Radz de Jesus
            16:03 02 Jun 20
            We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
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            Oman to announce 5% VAT from April

            Jay Krishnan, Partner

            image

            HLB HAMT - Accounting Firm in UAE
            Phone:- +971 4 327 7775
            Mobile:- +971 50 677 5860
            Email:- dubai@hlbhamt.com

              Get Free Consultation




              Oman has been facing severe economic crisis even before the spread of the COVID-19 pandemic and the fall of the crude oil prices. In order to stabilise the economy, Oman has planned to introduce 5% Value Added Tax (VAT) from April 2021.

              The tax will be exempt for essential food products, medical care, education and financial services according to the royal decree. The fall of the oil prices has caused serious monetary problems for many countries.

              According to the International Monetary Fund, the budget deficit of Oman as a share of gross domestic product is anticipated to be the highest in the region.

              UAE and Saudi Arabia had also faced similar economic crisis, which was followed by the introduction of VAT in 2018. Saudi Arabia even tripled their tax this year in order to overcome the situation.

              The introduction of VAT will bring in an extra income to the country and will help them to stabilise their economy. The year of 2020, has caused immense trouble to the global economy, and every nation is struggling to meet their ends. Countries are coming up with several initiatives to strengthen the economy and to help its people.

              Would you like to rate us on Google?         

               

              Varun R Chandra
              Varun R Chandra
              07:38 25 Apr 21
              HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
              Giuseppe Assi
              Giuseppe Assi
              06:20 31 Jan 21
              I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
              Mohamed Sheriff
              Mohamed Sheriff
              16:16 28 Jun 20
              Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
              218141 JOSEPH THOMAS
              218141 JOSEPH THOMAS
              16:20 23 Jun 20
              Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
              PMI
              PMI
              07:14 23 Jun 20
              In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
              RAVI CHOKSI
              RAVI CHOKSI
              08:28 21 Jun 20
              Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
              Maharajan Subramaniam
              Maharajan Subramaniam
              18:17 06 Jun 20
              High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
              Mohammed L
              Mohammed L
              08:07 05 Jun 20
              We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
              ROY ROSHAN VIVIAN
              ROY ROSHAN VIVIAN
              06:32 04 Jun 20
              Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
              Basil Daniells
              Basil Daniells
              05:55 03 Jun 20
              I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
              Amar Kashyap
              Amar Kashyap
              19:28 02 Jun 20
              Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
              Radz de Jesus
              Radz de Jesus
              16:03 02 Jun 20
              We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
              Next Reviews
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              Whatever your question our team will point you in the right direction

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              Bahrain End of Service Gratuity Calculation

              HLB Bahrain Payroll Team

              image

              HLB HAMT - Accounting Firm in UAE
              Phone:- +971 4 327 7775
              Mobile:- +971 50 205 9540
              Email:- dubai@hlbhamt.com

                Get Free Consultation




                Article 116 of Bahraini Labor Law states categories of workers to whom the Provisions of the social Insurance Law are not yet applicable, the employer concerned shall pay to such worker, upon the termination of employment, a leaving indemnity for the period of his employment calculated on the basis of 15 days wages for each year of the first three years of service and of one-month wages for each year of service thereafter.

                Almost every employee must have heard about gratuity payment, but not many know the terms and conditions involved and how it is calculated. Here, we take you through a set of questions and answers that will help in clearing all your doubts related to end of service gratuity in Bahrain.

                1. What is Gratuity?
                  Gratuity is a monetary payment eligible to an employee as a lump sum at the end of his tenure provided that the period of service exceeds one year. Gratuity payment is a liability to the employer which accrues as the employee service period progresses.
                2. Who is entitled to a Gratuity?
                  Expatriate workers are entitled to a gratuity on completion of their contract. Social insurance law applies to nationals employed in Bahrain and they are not entitled to Gratuity.
                3. When does an employee become eligible for his/her gratuity payment?
                  Employees are eligible for gratuity pay at the end of their service period, upon the death of the worker, by a disability preventing his work performance or by a period of sickness which exceeds his entitlement to sick and annual leave. According to Article 116, the worker shall be entitled to gratuity for the fraction of the year worked.
                4. What is the basis amount that is used to calculate gratuity?
                  As per Article 47, leaving indemnity shall be calculated on the basis of the worker’s most recent basic wage in addition to social allowance, if any.
                5. What is the number of days used to accrue gratuity?
                  15 days’ wages for each year of the first three years of service and one-month wage for each year of service thereafter.The following example shows the gratuity accrual at a given time.

                  Particulars0-3 Years3 Years and Above
                  Hire Date10/Apr/2001/Mar/18
                  Payroll MonthMar-22Mar-22
                  Number of days in Service as of 31st March 2022721.001492.00
                  Number of Years in Service1.984.09
                  Salary12001200
                  One Day salary ( Salary /30)4040
                  Gratuity Days
                  First 3Years29.6345.00
                  3 years and Above0.0032.63
                  Gratuity Days in total29.6377.63
                  Gratuity Amount           1,185.213,105.21

                   

                6. Does type of termination of an employment contract make any difference in gratuity payment?
                  Termination of an employment contract can be in terms of Resignation, Non-renewal of the contract or termination by the employer. In all these cases, the employer is bound to pay end of service benefits. If an employee is terminated as per article 107, the Employer is not liable to pay any Gratuity to the employee
                7. What is the effect of unpaid leave taken during the period of service?
                  Any period taken by the employee as unpaid leave is excluded when determining the service period. That means unpaid leave days are excluded when accruing gratuity. The period of service is reduced by the number of days served as unpaid leave.
                8. Can an employer withhold gratuity payment?
                  As per Article 107, the employer may dismiss the worker without compensation in any of the following instances:

                  • If the worker assumes a false identity or submits false certificates or testimonials.
                  • If the worker committed a fault that caused serious material loss to the employer-provided that the employer shall report the matter to the competent authorities within two working days of his knowledge of the seriousness of the material loss.
                  • If the worker, despite a written warning, fails to comply with written instructions which are required to be observed for the safety of workers or the establishment, provided that such instructions are posted up in a prominent place in the workplace
                  • If the worker absents himself from work, without legitimate cause, for more than twenty(20) intermittent days or for more than ten consecutive days in one year, provided that such dismissal shall be preceded by warning in writing by the employer to the worker after an absence of ten days in the former instance and an absence of five days in the latter instance.
                  • If the worker fails to perform his essential duties under the contract of employment.
                  • If the worker discloses, without written permission from the employer, the secrets related to the work.
                  • If the worker has been finally sentenced for a crime or misdemeanour involving dishonor, dishonesty, or public morals.
                  • If the worker is found during the hours of work to be under the influence of alcohol or drugs, or if he has committed an immoral act at the place of work.
                  • If the worker assaults his employer or his responsible manager or commits a serious assault upon any of his supervisors at work during the course of employment or for reasons connected therewith.
                  • Worker’s failure to comply with the legally prescribed rules concerning the exercise of the right to strike
                  • If the worker becomes unfit to do his work subject to the contract due to a cause attributed thereto such as canceling his permit to practice his work or loss of the qualifications authorizing him to do the mutually agreed work.
                9. How Gratuity is calculated during final settlement?
                  Please see the below example for calculating Gratuity during final settlement.

                  Total Service periodGratuity calculation
                     Less than3 years15 days wage for each of the first three years of employment
                     3 years and Above15 days wage for each of the first three years, One-month wage for each of the following years in service

                  Please see the below example for calculating Gratuity during the final settlement.

                  Service periodLess than 3 Years3 years and Above
                  Hire Date10/Apr/2001/Mar/18
                  Payroll Month14/Mar/2222/Mar/22
                  Number of days in Service as of 31st March 2022704.001483.00
                  Number of years in Service1.934.06
                  Salary12001200
                  One Day salary ( Salary /30)4040
                  Gratuity Days
                  First 3Years28.9345.00
                  3 years and Above0.0031.89
                  Gratuity Days in total28.9376.89
                  Gratuity Amount           1,157.26                     3,075.62

                Whether you are someone who has resigned from work, or has been terminated by the employer, the gratuity that you are eligible to receive at the end of your service can be of great help while transitioning to your next job. Hence, it is important to be aware of the gratuity payment policies and any changes to it.

                For information on the payroll process in Bahrain click on this link

                Payroll Process in UAE

                The process of payroll is little complicated and time-consuming; hence it is always recommended to outsource your company’s payroll function. Outsourcing payroll will ensure the assistance of a team of trained payroll professionals and it frees up the time of the organization, helping them focus on other projects that add value to their business.

                One should be extra vigilant while selecting their payroll provider, as payroll data is highly sensitive, and one should opt for a provider that can ensure high levels of data security.

                As a leading payroll outsourcing company, HLB HAMT can help solve your payroll complexities through customized strategies. We take care of our clients’ entire payroll cycle that includes preparation of payroll reports, processing salary payment with WPS compliance, accrual management including Gratuity, pension funds, an online portal for accessing payslips, and many more. Our leadership team spends the necessary hours in every project, ensuring our clients get refined consulting services to take your business forward.

                To know more about our payroll process, click here

                Disclaimer:
                Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.

                Did you find the blog informative?         

                 

                Varun R Chandra
                Varun R Chandra
                07:38 25 Apr 21
                HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
                Giuseppe Assi
                Giuseppe Assi
                06:20 31 Jan 21
                I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
                Mohamed Sheriff
                Mohamed Sheriff
                16:16 28 Jun 20
                Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
                218141 JOSEPH THOMAS
                218141 JOSEPH THOMAS
                16:20 23 Jun 20
                Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
                PMI
                PMI
                07:14 23 Jun 20
                In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
                RAVI CHOKSI
                RAVI CHOKSI
                08:28 21 Jun 20
                Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
                Maharajan Subramaniam
                Maharajan Subramaniam
                18:17 06 Jun 20
                High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
                Mohammed L
                Mohammed L
                08:07 05 Jun 20
                We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
                ROY ROSHAN VIVIAN
                ROY ROSHAN VIVIAN
                06:32 04 Jun 20
                Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
                Basil Daniells
                Basil Daniells
                05:55 03 Jun 20
                I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
                Amar Kashyap
                Amar Kashyap
                19:28 02 Jun 20
                Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
                Radz de Jesus
                Radz de Jesus
                16:03 02 Jun 20
                We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
                Next Reviews
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                Whatever your question our team will point you in the right direction

                Start the conversation

                DIFC Data Protection Law 2020

                Jay Krishnan, Partner

                image

                HLB HAMT - Accounting Firm in UAE
                Phone:- +971 4 327 7775
                Mobile:- +971 55 160 1291
                Email:- dubai@hlbhamt.com

                  Get Free Consultation




                  Dubai International Financial Center (DIFC) has come up with a new Data Protection Law (DIFC Law No. 5 of 2020), replacing the current regime. The Data Protection Law prescribes rules and regulations regarding the collection, handling, disclosure and use of personal data in the DIFC, the rights of individuals to whom the personal data relates and the power of the Commissioner of Data Protection in performing their duties in respect of matters related to the processing of personal data as well as the administration and application of the Data Protection Law.

                  Click here to know more about DIFC data protection law.

                  Would you like to rate us on Google?         

                   

                  Varun R Chandra
                  Varun R Chandra
                  07:38 25 Apr 21
                  HLB Hamt is highly recommended! They have the quality of services that would satisfy your needs. I'm glad I found them.
                  Giuseppe Assi
                  Giuseppe Assi
                  06:20 31 Jan 21
                  I HAD A GOOD EXPERIENCE WITH HLB HAMT DUBAI. THEY HAVE A VERY PROFESSIONAL TEAM, GOOD QUALITY OF SERVICES, GOOD VALUE... FOR PRICE.I RECOMMEND THIS COMPANY.read more
                  Mohamed Sheriff
                  Mohamed Sheriff
                  16:16 28 Jun 20
                  Experience with HLB Hamt in audit experience is great pleasure. They deploy well qualified accounts team for audits.... And the amount of checking they perform give the management of the company confidence that internal controls are well in place. We are glad to see they have high standard of audit practices.read more
                  218141 JOSEPH THOMAS
                  218141 JOSEPH THOMAS
                  16:20 23 Jun 20
                  Professionally managed firm with commitment to the engagements taken. My company and its group are assigning our... requirements for last 12 years to HLB and we don’t have any negative remarks on any assignments.read more
                  PMI
                  PMI
                  07:14 23 Jun 20
                  In my opinion, HLB Hamt is one of the best professional firms in UAE after big4. Excellent client service, professional... and competent staff and timely delivery are their strength. Over the years they have developed the infrastructure and skill set to handle multiple verticals ie, audit, tax services, consulting, IT support etc.Wishing HLB Hamt team all the very best.read more
                  RAVI CHOKSI
                  RAVI CHOKSI
                  08:28 21 Jun 20
                  Thank you Team HLB hamt...Your internal auditing team put the good amount of time and inputs in helping the... organisation making considerable improvements throughout the organisational working structure and helps in building the better business.Thanks.read more
                  Maharajan Subramaniam
                  Maharajan Subramaniam
                  18:17 06 Jun 20
                  High-Performing IT Teams, I'm impressed with the knowledge level of their deputed staff, audit procedures, and... checklist adopted. Mr. Vimal especially understand the requirement and provide solution not only technical feasibility and also considered budgeting. We’re confident in their abilities.read more
                  Mohammed L
                  Mohammed L
                  08:07 05 Jun 20
                  We have been working closely with them on payroll services for quite sometime.They provide very professional... services,experts in domain and excellent support. Would recommend them.Cheers.read more
                  ROY ROSHAN VIVIAN
                  ROY ROSHAN VIVIAN
                  06:32 04 Jun 20
                  Very professional team. Vimal has always given us good solution advice for various Software and IT Infra projects. We... are very Extremely satisfied working with him and his team. Wishing them success.read more
                  Basil Daniells
                  Basil Daniells
                  05:55 03 Jun 20
                  I have worked with HLB as a partner of Sage for about 2 years, they were dedicated to the success of the partnership... and kept aligned with the business plan that was agreed between our two companies. They are always ready to go the extra mile for a customer and don’t shy away from challenging circumstances. Keep up the good work and wish you all the success in the future.read more
                  Amar Kashyap
                  Amar Kashyap
                  19:28 02 Jun 20
                  Team of well qualified and organised professionals. Their reports are not based on numbers first they will understand... their client and their business. They are highly recommended and trust worthy.read more
                  Radz de Jesus
                  Radz de Jesus
                  16:03 02 Jun 20
                  We're glad to have found HLB Hamt to conduct the IT audit and risk assessment for our organization. We have learned a... lot from their team during that first project. And since then, we've continued to be in touch with them. Mr. Vimal especially is very good at presenting technical concepts in simple yet interesting ways that non-IT and business people alike would easily catch. We are very happy with the professionalism and quality of service they provide. They leave their clients nothing short of satisfied. Highly recommended.read more
                  Next Reviews
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                  Whatever your question our team will point you in the right direction

                  Start the conversation

                  Payroll Outsourcing Saudi Arabia :- A brief overview

                  HLB KSA Payroll Team

                  image

                  HLB HAMT - Accounting Firm in UAE
                  Phone:- +971 4 327 7775
                  Mobile:- +971 50 205 9540
                  Email:- dubai@hlbhamt.com

                    Get Free Consultation




                    For a layman, payroll is all about getting your wages paid on a specific date of every month. But it is much more than that. It is a huge responsibility that involves a lot of dedication, knowledge, and resources. Ensuring that all the employees within an organization get paid the correct salary on time with deductions/ allowances if any while complying with all the payroll rules and regulations, is mandatory.

                    The payroll process will not be the same for all countries; each country has its own tax laws, minimum salary requirements, pension plans, gratuity schemes, leave policies, and many more. Earlier, we covered through a detailed blog, on the payroll process in UAE. Here, our experts in KSA payroll will enlighten you on the payroll process in KSA, through a set of FAQs.

                    1. What is the frequency of making salary payments to employees in KSA?

                      The law stipulates in Article 90 that the intervals for making salary payments to employees should be monthly or weekly depending on the type of contract.Workers paid on a daily basis shall be paid at least once a week. Workers paid on a monthly basis shall be paid once a month. If the work is done by the piece and requires a period of more than two weeks, the worker shall receive a payment each week commensurate with the completed portion of the work. The balance of the wage shall be paid in full during the week following the delivery of the work. In cases other than the above, the worker’s wages shall be paid at least once a week.

                    2. Which are the statutory pay components included in employee salary?

                      The KSA labor law does not define the components that should make up an employee’s salary; there are no defined statutory components.

                    3. Which are the common pay components that are normally payable to employees?

                      Fixed components may include Basic salary, House rent allowance, transport allowance, and other allowances. The variable components may include Overtime, Sales commission, Bonus, Incentives, Relocation allowances, Mobile allowances, etc.

                    4. What is the minimum salary payable in KSA?

                      There is no minimum salary payable in KSA.

                    5. How is overtime calculated?

                      Overtime is any extra hours worked by an employee beyond the normal working hours. Article 107 states that the employee shall be entitled to a remuneration equal to his normal working hours plus an extra of at least 50% of such remuneration. All working hours performed during holidays and Eid’s shall be considered as overtime hours

                    6. How is gratuity accrued?

                      As per article 84 of Saudi Labor Law, the Gratuity calculation is accrued on the following basis.

                      • If the service period is below five years at half a month salary per year.
                      • If the service period is more than five years at a full month salary per year.
                    7. When is gratuity paid to an employee?

                      Gratuity is paid at the end of employment. The end-of-service award shall be calculated on the basis of the last wage and the worker shall be entitled to an end-of-service award for the portions of the year in proportion to the time spent on the job. The gratuity paid is not affected by the type of contract, but by the type of separation. There is no EoSB entitlement if an employee is terminated under Article 80 of Saudi Labor LawFor a comprehensive understanding of KSA gratuity accrual and settlement, please refer to our article on KSA gratuity policy and settlement.

                    8. What are the statutory deductions that are made to employees in the KSA?

                      In the KSA, payroll is not subject to income tax, and hence there are no mandated tax deductions. However, KSA nationals are subject to mandatory national pensions plans contributions.

                    9. How is KSA pension (Social Insurance) calculated? Which employees qualify for KSA pension contribution?

                      GOSI, or the General Organization for Social Insurance, is a major government entity in the Kingdom of Saudi Arabia (KSA) that implements the country’s Social Insurance Law.

                      GOSI percentage for Saudi nationals is 21.50%. Please find the below break up;

                      Employer’s Contribution

                      • Unemployment Contribution = 0.75%
                      • Retirement Contribution = 9%
                      • Compensation and Disability Plan = 2%
                      • Total Employer’s Contribution = 11.75%

                      Employee’s Contribution

                      • Unemployment Contribution = 0.75%
                      • Retirement Contribution = 9%
                      • Total Employee’s Contribution = 9.75%

                      The employer is responsible for paying a 2% GOSI contribution for Expat staff. However, there is no GOSI contribution to be paid by an expatriate employee in Saudi Arabia.

                      SAR 45,000/- is the maximum basic sum utilized in GOSI calculations.

                      The amount paid effectively adds towards the retirement benefits of the National employees, and for expatriates, it adds towards work-related injuries fund which is limited to a certain amount. They are split into 3 categories:

                      1. Saudi Nationals (private & public sector) – 21.50% of the maximum monthly applicable earnings (9% each for the employee and employer for pension, 0.75% each for unemployment contribution and 2% for occupational hazard which the employer pays)
                      2. GCC Nationals (excluding Saudis) – between 17-22% in total depending on the nationality
                      3. Expatriates – 2% unemployment contribution paid by the employer
                    10. What is WPS in Saudi Arabia?

                      The Wage Protection System (WPS) in Saudi Arabia became mandatory for all Saudi companies operating in the private sector. The objective of the WPS is to minimize any delay and issues in the payment of salaries.Under the WPS, companies are required to submit wage information to the Ministry of Labor via the e-service program. The WPS ensures that employee rights are protected and that salaries are paid according to agreed terms of employment contracts.

                    11. Are Employees eligible for Air Ticket Benefits in KSA?

                      Employers are required to provide return air tickets to the worker’s home country at the end of the relation between the two parties. The right of the air ticket with annual leave is determined by the contract signed by the employee with the employer, Saudi labor law is silent about this. However, many companies provide air tickets to employees annually and some of the companies extend this payout to employees’ dependents as well.

                    12. What is the leave policy defined under the labor law?

                      A. Annual Leave
                      According to article 109 of the KSA labor law, a worker shall be entitled to a prepaid annual leave of not less than twenty-one days, to be increased to a period of not less than thirty days if the worker spends five consecutive years in the service of the employer. A worker shall enjoy his leave in the year it is due. He may not forgo it or receive cash in lieu during his period of service. The employer may set the dates of such leave according to work requirements or may grant them in rotation to ensure the smooth progress of work. The employer shall notify the worker the date of his leave insufficient time of not less than thirty days.
                      B. Sick leave
                      A worker whose illness has been proven shall be eligible for a paid sick leave for the first thirty days, three-quarters of the wage for the next sixty days, and without pay for the following thirty days, during a single year, whether such leaves are continuous or intermittent. A single year shall mean the year which begins from the date of the first sick leave.

                      • First 30 days: 100%
                      • 31 to 90 days: 75%
                      • 91 days to 120 days: unpaid

                      C. Maternity leave
                      Female workers shall be entitled to fully paid maternity leave for a period of 10 weeks to be divided at the female worker’s discretion. Such period may start four weeks prior to the expected date of delivery. A woman may not, under any circumstances, work during the six weeks immediately following delivery. She shall be entitled to extend the leave for an additional two months as unpaid leave. In the event of giving birth to a sick child or a child with special needs whose health condition requires a constant companion, a female worker shall be entitled to a one month leave with full pay starting at the end of the maternity leave and she shall be entitled to extend the leave for an additional month as unpaid leave.
                      D. Hajj Leave
                      A worker shall be entitled to a paid leave of not less than 10 days and not more than 15 days, including Eid Al-Adha holiday, to perform Hajj only once during his service if he has not performed it before. To be eligible for this leave, the worker must have spent at least two consecutive years of service with the employer.
                      E. Paternity Leave
                      Employees are eligible for 3 Days of paid leave up on the the birth of a child.
                      F. Marriage leave
                      As per Article 113, For a marriage, an employee is entitled to 5 days of paid leave.
                      G. Compassionate Leave
                      Compassionate leave is provided and given for five days for the death of a spouse or one of his ascendants and descendants.
                      H. Iddah Leave
                      In the case of a Muslim woman whose spouse has died, the Iddah leave is provided for the full mourning period of four months and 10 days. In the case of a non-Muslim woman, the leave is given for fifteen days.

                      Please read our article on KSA leaves policy here for a comprehensive understanding.

                    13. Is employee Medical Insurance mandatory in KSA?

                      It is mandatory that an employer provide medical insurance to the employee during the duration of employment

                    14. Which are the currencies that can be used while making salary payments in KSA?

                      The only accepted currency used in making salary payments is the KSA national currency i.e. SAR and the payments should be made within the boundaries of the country.

                    15. Is bonus or incentive payment mandatory in KSA?

                      Bonus and incentives payments are not mandatory in KSA. Many companies in the KSA have bonus or incentive schemes implemented to keep employee motivation and the structures vary from one company to the other based on their policy.

                    16. What are the items included in End of Service Benefits calculation in KSA?

                      The employee is entitled to the following end of service benefits.

                      • End of service Gratuity
                      • Repatriation ticket if applicable
                      • Notice period pay if applicable
                      • Any unutilized leave (Vacation) pay
                      • Any other outstanding payment or deduction
                    17. Employee Benefits in summary:

                      1. Salary
                      2. Gratuity
                      3. Air Ticket
                      4. Annual Leave
                      5. Sick leave
                      6. Maternity Leave
                      7. Paternity Leave
                      8. Marriage Leave
                      9. Compassionate Leave
                      10. Medical Insurance
                      11. Overtime pay if applicable.

                      Laws and policies are ever-changing. We always ensure that we stay up to date with the payroll legislations, not just in KSA, but the whole of GCC.

                      Payroll Process

                      The process of payroll is a little complicated and time-consuming; hence it is always recommended to outsource your company’s payroll function. Outsourcing payroll will ensure the assistance of a team of trained payroll professionals and it frees up the time of the organization, helping them focus on other projects that add value to their business.

                      One should be extra vigilant while selecting their payroll provider, as payroll data is highly sensitive, and one should opt for a provider that can ensure high levels of data security.

                      As a leading payroll outsourcing company, HLB HAMT can help solve your payroll complexities through customized strategies. We take care of our clients’ entire payroll cycle that includes preparation of payroll reports, processing salary payment with WPS compliance, accrual management including Gratuity, pension funds, online portal for accessing payslips, and many more. Our leadership team spends the necessary hours in every project, ensuring our clients get refined consulting services to take your business forward.

                      To know more about our payroll process,Click here

                      Disclaimer:

                      Whilst every effort has been made to ensure the accuracy of this information, HLB HAMT will not accept any liability arising out of errors or omissions. Please note that this blog is not all-inclusive. Our guidance is designed only to give general information on the issues/topics covered. It is subjected to change and not intended to be a comprehensive summary of all laws which may be applicable to your situation, treat exhaustively the subjects covered, provide legal advice, or render a legal opinion.

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