Housing allowance
In one sentenceAn amount paid to the employee for housing on top of the basic salary, in cash every month or in advance, unless the business provides housing itself.
Simply put
The housing allowance is agreed in the contract. It may be a fixed amount or a percentage of the basic, paid monthly or as an advance payment for several months.
It has a direct effect on cost: it is included with the basic in the GOSI contributory wage, and in the wage on which the end-of-service benefit is calculated.
Worked example
A contracting business gives its employee a housing allowance of 25% of the basic (an assumed rate for illustration; the business sets it in the contract), and his basic is 6,000 SAR.
Basic salary6,000
Housing allowance 25% × 6,0001,500
GOSI contributory wage (basic + housing)7,500
Monthly housing allowance1,500 SAR
Don't confuse it with
Transport allowanceThe transport allowance is not included in the GOSI contributory wage, while the housing allowance is.