nk111

Hi all,

I need someones advice. i have been offered a job which i am going to have to negotiate the terms of my contract.
This will be the first time that i have done anything like this but i am leaving a UK subsidiary to take a initial 2 year assignment in Riyadh with our JV partner.

I am searching the net but would appreciate some general advice on what i should be considering as cost for the following -

3 / 2 bed appartment / villa - (in or around Olaya district)
School for 3 young children (if i decide to relocate the family, and a British school preferred)
car allowance

What would be considered expensive , what low and what average as this will be helpful in any discussions i am due to have.

One other question that i have is related to Tax, my understanding is as a non resident that i do not pay tax (without going into all that i have read), however i am being advised that they may withold the tax i would of paid and i will be reciving a net salary ....is this something anyone has had to negotiate themselves out of?? ....id want to be paid gross full stop but wanted to check if i had missed something here from a UK tax perspective

All in all as someone who is doing this for the first time it feels like i'm asking for the earth so some reality checks in terms of what actual costs i am going to experience would be helpful so at least i have factual information to base decisions on.

The Dean

You need to get 'back to basics' I think............. firstly, it is absolutely essential that you have your accommodation sorted out before you arrive. Your employer - or the JV partner - should know that. Do not expect to turn up, stay in a hotel for a few days, then find somewhere to live. You won't.

If accommodation etc is provided free of charge, that will affect what you might reasonably expect to get paid - give us some more details if you can.

The tax question - there are a number of people who hang around The Bored who will be able to advise you, but can you clarify that "UK subsidiary" point? Are you saying you will still be employed by the same firm you work for now? That needs sorting out too............. don't let them treat it as a long-term business trip or a consultancy project for a UK-based firm. You won't get the benefit of the zero income tax in Saudi.

Finally - good luck. I always found the Saudis a pleasure to work with.

nk111

Hi

Thanks for your reply.

The details i have at the moment are as follows -

I am being sponsored by my company to assist our JV partner on IT software implementaion project for 2 years. My intention is to remain there after the 2 years and this was made clear. The 2 year scenario i agreed to as i wanted to make sure from both sides that it will be good for me and my family as well as them.


Current Offer -
Salary of £43k , Allowance of $22,500 (equates roughly to 85kSAR for housing, car and schooling)
I also will be getting Medical and 1 flight for me and family a year

On the Salary they have mentioned withholding some kind of notional tax, similar to how i am taxed in UK so i should expect my net pay. This i intend to discuss as im not sure why they need to do this other than for the reason that you mentioned.

This would mean the following at todays exchange - $258k gross , $189k net

On this particularly issue i was looking to negotiate, firstly on tax i want it gross and secondly on a rise as i intend to remain there after the 2 years and i can command a higher salary in the UK in my profession if seek it outside my company. I just want to make sure that i am paid exactly what someone in my profession is worth (Accountant) £50- £60k and not be in discussion 2 years from now to fighting for i'm worth having uprooted my family in the process

Allowance - From what i can see the this is a little on the low side and hence i am seeking some guidance. I have returned from Riyadh a few weeks ago and i aware that compunds are not only expensive but have a waiting list.
On this allowance i don't think i would get into a compund or get my children in a British school.

As much as i would like them to assist in finding the housing, i would if i agree need to be out there within the next 2 weeks as the project has already begun....so really need the allowance sorted.

What i have found out so far is -

School - 120k SAR For 3 children @ approx 40ksar each
Housing - 3 Bed appartment ??? Compound ??? i have no idea what i should be coming back with and need some facts on this.

Car - No idea


Taking all this into consideration my expectation prior to the offer was for the following, hence my comment about i feel like i am asking for the world-

Allowance
Housing - 120ksar
School - 120ksar
Car - 20ksar

Salary - 360ksar (£60K), on this i can see that it is a big jump so would be prepared to come down to £50k at least for the 2 years out there.

Hope this is enough informaion for you asses as what i am asking is too much, low or reasonable.

Thanks

nk111

whoops the salary i quoted is 258k sar and 189ksar net

Southlondoner

Hi

I was also considering a job offer in Riyadh earlier this year. I also work within finance - and this opportunity was at a bank in Riyadh.
To make sure I understand this right, your offer is

Gross Basic Salary= SAR 258k
School = SAR 120k for 3 kids
House = SAR 120k
Car = SAR 20k

I am working on these figures. Sorry to be blunt but they are taking you for a ride.

The basic salary is low - and remember your end of service bonus will be based on this figure.
I don't have kids so do not know about schools. The international schools are expensive though in Riyadh.
The housing allowance is ridiculous! A tiny 1 bed apartment on a compound costs SAR 80k per year. A 3 bed villa is only feasible at that price if you live in the city, with all the restrictions for your wife.
Car - ask them to triple that allowance. You will need a large car for 3 kids and your other half.

This financial offer is good only if you go out on your own. With a wife and 3 kids - you will save next to nothing. Especially if they withold your tax saving.

A rough rule of thumb is the total package to work in Riyadh should be better than your gross salary in the UK. Do not use the net number - the tax benefit is the least you should get for uprooting and living in Saudi.

I work in a similar field to you. The problem we have is there is a deep pool of talented accountants from India and Pakistan who would jump at the chance to work in Saudi - and this package would be good from their perspective. But - not if you are uprooting from the UK.

Stealth Otter

I agree with all of that - for a 3 bed villa in a decent compound you're going to be looking at 160ksar at the very least.

nk111

Thanks for your post i appreciate you being blunt . i'm keen to gather all the advice and facts i can get before i go into a meeting with them on Monday to discuss the terms.

Actually the offer is worse than you think ....its 189ksar net salary plus 85ksar allowance for everything housing ,school and car.
Flights and medical which they will also cover.

To be honest my immediate thoughts were this was pathetic and a complete joke but before i go into to discuss i wanted to throw some facts at them because there is no way i can accept these terms.

Actually the figures you are mentioning are what i was looking given what i could find of the www, except the salary where i was looking for is a near 360KSAR

I obviously have the figures wrong on the housing as i can 't seem to find any good websites for research purposes that give a accurate idea of housing costs, where they are etc etc....it appears its in the region of 200ksaro

So to sum it up, would the following ignoring the salary be fair assumption of the costs i would expect or am i still a little off ? -

Salary - 360ksar
housing - 200ksar
Car - 60ksar
School - 130ksar

Total package - approx 750k

Sounds a heck of alot!!

The only thing i have in my favour in terms of negotiations is
1) They have apparently only interviewed me, no back up for them i think
2) I bring with me 7 years experience of working for the company
3) They are due to start / or will have started this month with a go live in 6 months.

but don't really want to rely on that as i would really like to take this opportunity as it would be good for my career ...more would like to focus on the offer which is not viable at all with facts to back it up.

Thanks again to all that are advising me here.

Stealth Otter

750k SAR does sound a bit heroic - bear in mind that here accommodation, schooling and buying/leasing/renting a car are your main expenses; everything else is cheaper than the UK. So in effect you'd be on a better salary than the UK but without the expenses that you currently pay in the UK out of your salary...viewed like that you may want to negotiate a bit on your basic salary. 60ksar a year for a car sounds high - you can get a new family car for around 100k (Fortuner, RAV4 etc).

Having said all that, there should be a 'ballache' allowance for moving here - not paying UK tax and a 20% salary increase is a good place to start.

nk111

Thanks appreciated, got a better idea now.

Out of curiosity are there any sites you or anyone could recommend for housing in Riyadh....somewhere near Olaya?

Stealth Otter

Nottmbantam posted an up to date list of riyadh compounds on here a couple of weeks back. If you're looking for a villa outside of a compound then there's usually a few ads on justlanded.com
I wouldn't bother trying to sort a compound out from overseas, you have to be here really to get any interest from the agents. Take The Dean's advice though and insist your company find you the accommodation...it really does make things a lot easier when you first get here.

Southlondoner

Hi NK111

SAR 750k is probably too much. The gap between their intial offer and this is just too huge. Especially because the region is in slowdown too. Deal activity has dropped off a lot.
What do you think of:

Basic Salary of SAR 280k
Car Allowance of SAR 50k
Schooling of SAR 120k
Housing of SAR 150k

Total Package = SAR 600k

The schooling - you can look up annual fees at the British International School in Riyadh to judge if that is realistic.

To put this in context, my offer was:
Salary of SAR 271k . I have 10 years experience in the City, so this was definitely on the low side.
Car Allowance of SAR 56k
Housing of SAR 81k
Total = SAR 408k

I am single, and was going to be there on my own. This package is decent - but by no means great. It would be difficult to save a lot while living in a compound. Definitely not enough to justify moving to Saudi from London.

Your advantages are that you have been with the company a long time and they have no plan B.

nk111

Will do and again thanks your advice has been really helpful.

Hopefully i'll have some good news in a few days....if not i'll have to try another route to get to SA / UAE

Southlondoner

Hi NK111

Hope your negotiations went well .Did your employers come up with a more realistic offer? The fundamentals in Saudi are strong. Young population, growing economy, large market and oil reserves. You do need a good package to justify moving from UK though.

Good luck.

nk111

Hi,

Due to our qtr enr i only got to speak with them yesterday. they requested that i come back to them with my findings and my porposals which i am drafting as i speak.
Since i spoke to you i have been considering and did bring this up (assuming the package was right) that moving out on my own was a possibility, simply as i did not want to uproot my children from a good school for 2yrs when the future after this point was unclear.

This does change the allowance some what where i am replacing the school fees with flights for me to visit them and they me more frequently.

Simply put i am making it clear that i can not consider the opportunity if either my financial position or the quality of life my family currently enjoys is impaired.

I just need to convince them the housing costs we discussed are reasonable, i found a site Justlanded.com that shows appartments below iand n the region of 40k a year. These obviously aren't in compounds but i feel i need to justify why i wouldn't accept these over something that would cost in the region of 120k+

Paracletus

If you did 'uproot' your children, I'm certain they would thank you later in life..seriously. Best thing my folks ever did, even though its now officially 25 years since I got arrested for the first and last time as an illegal immigrant..lol.