Bahrain Social Insurance Contribution Changes: What You Need to Know
The Social Insurance Organization (SIO) in Bahrain manages social insurance and pension services for workers in both the private and public sectors. Recent updates to the Bahrain social insurance contribution system are important for both employers and employees to understand.
What Are the Changes to Bahrain Social Insurance Contribution?
Starting in May 2022, the employer’s contribution to Bahrain social insurance for Bahraini workers increased by 2%. This marks the first in a series of annual increases. From January 2023, the employer’s contribution will increase by 1% each year, until it reaches 20% in January 2028.
For Bahraini workers, the employee’s share of the Bahrain social insurance contribution will also rise. Beginning in January 2023, the employee’s contribution will increase by 1%, bringing the total to 8%.
Employers are responsible for withholding both their own and the employee’s contributions and submitting them to the SIO each month.
Current Contribution Rates in Bahrain
Currently, the Bahrain social insurance contribution is divided as follows:
- Local employees: 19% total (12% employer, 7% employee)
- Expatriate workers: 4% total (3% employer, 1% employee)
These contributions ensure financial security for workers and are a part of Bahrain’s social welfare system.
How These Changes Affect Employers and Employees
Employers will need to adjust their payroll to accommodate the new Bahrain social insurance contribution rates. These updates must be followed carefully to ensure compliance with the law. Contributions need to be submitted to the SIO on time, every month.
Stay Informed on Bahrain Social Insurance Contributions
If you need help understanding these changes or managing payroll compliance, our Bahrain team can guide you. Our services also include PEO & EOR support to ensure smooth operations for your business.
Feel free to contact us for expert advice and solutions that fit your needs. We are here to help you stay compliant with Bahrain’s social insurance contributions.
