Saudi Arabia Accounting and Tax Services
Many international clients engage Tetra Consultants for Saudi Arabia accounting and tax services after Saudi Arabia company registration. Tetra Consultants will timely complete your firm’s financial statements, corporate tax returns and manage auditors on your behalf without the need to travel. It is crucial to meet the deadlines stipulated by the General Authority of Zakat and Tax.
Contact us now to find out more about Tetra Consultants’ Saudi Arabia accounting and tax services. Our team of experts will revert within the next 24 hours.
There is no personal income tax in Saudi Arabia. However, there are three types of taxes levied on the Companies based on the shareholding structures:
- Corporate Income Tax: on all registered entities including companies or branches having foreign ownership.
- Withholding tax: on entities making payment to non-residents, such as for rent, royalties and management fees
- This will range between 5%-20% depending on the type of service as well as if the beneficiary is a related party.
- Zakat (Islamic wealth tax): Zakat, a religious levy, is charged on the company’s Zakatbase at 2%. Saudi citizen investors (and citizens of the GCC countries, who are considered to be Saudi citizens for Saudi tax purposes) are liable for Zakat.
- Value-added Tax (VAT) of 5% that is applicable to everybody in Saudi Arabia
Where a company is owned by both Saudi and non-Saudi interests, the portion of taxable income attributable to the non-Saudi interest is subject to Corporate tax, and the Saudi share goes into the basis on which Zakat is assessed.
Saudi Arabia Corporate Tax Rate
- The Saudi Arabia corporate tax rate for unlisted companies is 20%.
- Tax is on the net adjusted profits
- The share of profits attributable to interests owned by non-Saudi / non-GCC nationals is subject to income tax.
- The share of profits attributable to interests owned by Saudi / GCC nationals is subject to Zakat (religious levy).
Annual Reporting Requirements
- Saudi Arabia uses accounting standards issued by SOCPA which are fully compliant with the IFRS. You will need to maintain your accounting reports, especially the balance sheet as well as the profit and loss account. It is a requirement that this is required to be published every fiscal year.
- Only licensed auditors, recognized by the Ministry of Commerce and Industry can perform auditing in Saudi Arabia. The Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) is an Islamic international autonomous non-profit corporate body that prepares accounting, auditing, governance, ethics and Sharia standards for Islamic financial institutions and the industry.
- Tax dues have to be paid within 120 days after the company’s end of fiscal year, and this is to be filed with the Department of Zakat and Income Tax (DZIT). Tax liabilities are to be settled via third party withholdings, monthly payments, or a combination or both.
- With regards to withholding tax, the tax withheld to the DZIT has to be paid within 10 days at the end of each month, together with an issuance of a certificate to the payee stating the amount of payment as well the tax withheld.
Contact us now to find out more about Tetra Consultants’ Saudi Arabia accounting and tax services. Our team of experts will revert within the next 24 hours.
