Single-Person Company in Saudi Arabia 2026: Is It Right for You?
Single-person company in Saudi Arabia 2026: how it differs from a sole proprietorship, whether foreigners can own one, how it works and what the cost covers.
If you want to start a business in Saudi Arabia on your own, with no partners, you will come across two options: a sole proprietorship and a single-person company. They sound similar, but for a foreign investor only one of them is really on the table. Here's the difference, and how a single-person company works in Saudi Arabia in 2026.
What is a single-person company?
It is a limited liability company owned by one person, who can be an individual or a company. It has its own legal personality, separate from its owner, so the owner's liability is limited to the capital. If the company runs into debt, creditors can't reach the owner's house, car or bank account.
Single-person company or sole proprietorship?
Comparison | Single-person company | Sole proprietorship |
|---|---|---|
Legal nature | A company with its own legal personality | A license for an individual to trade |
Liability for debts | Limited to the capital | The owner's personal assets |
Available to foreigners in Saudi Arabia | Yes, through foreign investment | No, only Saudi and GCC nationals |
So for a foreign investor in Saudi Arabia, a sole proprietorship isn't an option at all. If you want to work alone, the single-person company is the route.
Can a foreigner own a single-person company in Saudi Arabia?
Yes, and it is the most common choice for investors who want full ownership. In practice, the owner is your company outside the Kingdom: it gets the investment license and becomes the sole owner of the Saudi company. If you don't have a company abroad, we set one up for you in Egypt as part of the package.
Advantages and limits
Full control: no partners to agree with.
Your personal money is protected.
A Saudi entity that can bid for many government tenders.
You can bring in partners later by turning it into a multi-partner LLC.
Its shares can't be offered to the public.
Steps to set up a single-person company
The steps are the same as any company formation: prepare the parent company, get the investment license, reserve the trade name, draft the articles of association, issue the CR, then register with ZATCA, GOSI and Qiwa. We explain each one in our guide to company formation in Saudi Arabia.
One tip: even with a single owner, define the manager's powers clearly in the articles of association, especially if someone else will run the company day to day.
How much does it cost?
The cost depends on your activity and on whether you already have a parent company, and we give you a clear quote before you start.
The package covers the parent company, the license, the articles of association, the CR and the platform registrations. The cost is lower if you already have a parent company.
And in Egypt?
In Egypt, the minimum capital for a single-person company is EGP 1,000, but you deposit the full capital in the bank, while a sole proprietorship only pays fees on its capital. Taxes differ too: a single-person company pays 22.5% like any Egyptian company, while a sole proprietorship is taxed on income brackets. More in our guide to company formation in Egypt.
Why EL-LWAA
We have been setting up companies for more than 40 years in Saudi Arabia and Egypt. In this video, we explain the difference between a single-person company and a sole proprietorship:
Contact us to choose the right structure, or start through the ASSIS platform.
FAQ
Can a foreigner open a sole proprietorship in Saudi Arabia?
No. Sole proprietorships are for Saudi and GCC nationals. A foreigner can set up a single-person company instead.
Who is the owner of a foreign single-person company?
Usually your company outside Saudi Arabia, which gets the investment license and owns the Saudi company.
Can I add a partner later?
Yes, by amending the articles of association and turning the company into a multi-partner LLC.
Does a single-person company in Egypt need EGP 50,000 in capital for VAT?
No. The minimum capital is EGP 1,000, and VAT registration depends on your sales, not your capital.
Can I withdraw the capital I deposited in Egypt after formation?
The capital is deposited in the company's name and is used for its business with proper documents. Withdrawing it without documents causes accounting and tax problems. Contact us for the right way to use it.
Does the 10% dividend tax apply to a single-person company in Egypt?
Dividend tax generally applies to profits distributed by companies, and the details depend on your situation. Contact us and we'll calculate it for your company.
Can a tourism and travel business be a single-person company in Egypt?
Tourism companies need a license from the Ministry of Tourism, with special conditions on capital and legal form. Contact us and we'll tell you the right structure and the cost.