Limited liability company&
A Limited Liability Company (LLC) in Saudi Arabia is a legal entity formed by one or more shareholders and is a corporate structure that protects its owners from being personally pursued for repayment of the company's debts or liabilities.
Ownership: An LLC can be owned by one or more individuals or entities, known as shareholders. The liability of shareholders is limited to their share capital in the company.
Management: An LLC is managed by one or more managers appointed by the shareholders. The managers can be shareholders or third parties.
Capital Requirements: There is no minimum capital requirement for setting up an LLC in Saudi Arabia. However, the capital must be sufficient to achieve the company's objectives.
Registration: To register an LLC in Saudi Arabia, the shareholders must prepare and submit the company's articles of association, obtain a commercial registration certificate, and fulfil other legal requirements.
Taxation: An LLC is subject to corporate income tax on its profits. The standard corporate tax rate in Saudi Arabia is 20%.
Profit Distribution: Profits of an LLC can be distributed to shareholders as dividends. Dividends distributed to non-resident shareholders may be subject to withholding tax.
Legal Entity: An LLC is a separate legal entity from its shareholders, which means that it can enter into contracts, own assets, and incur liabilities in its own name.
Liability: Shareholders are not personally liable for the debts and obligations of the LLC, except to the extent of their capital contribution.
Restrictions: Certain activities in Saudi Arabia, such as banking, insurance, and telecommunications, may require specific licences and are not permitted for LLCs.
Conversion and Dissolution: An LLC can be converted into another type of company structure, such as a joint stock company, and can be dissolved through a formal legal process.