VAT arrives in KSA

The KSA General Authority for Zakat and Tax has launched a value-added tax (VAT) mobile app on December 30 2017, ahead of the VAT launch on January 1 2018. The app contains important information on the tax and enables consumers to find out if the business they are dealing with is indeed registered for VAT.

The application has a ‘check’ function which allows consumers to see whether or not the business is registered in VAT by scanning the barcode on the VAT registration certificate, or by entering the business' Commercial Registration Number or the 15-digit VAT identification number mentioned on the invoice. Other features include a calculator to compute the correct VAT amount due on invoices, and the ability to flag businesses which are in violation of the VAT laws.

Source: General Authority of Zakat & Tax. VAT explained.

KSA released final VAT regulations in late August 2017. Businesses with annual revenues between SAR 375,000 and SAR1,000,000 are required to register for VAT. Registration is optional for businesses with annual revenues between SAR 187,500 and SAR 375,000, while businesses with annual revenues less than SAR 187,500 are exempted from registration.

The penalty for failure to pay VAT on time is 5% of the VAT amount due for each month. Failure to file VAT return on time will result in a fine not less than 5% and not more than 25% of the VAT amount due. In addition, VAT due on late registered businesses will be calculated from the date of VAT implementation on 1 January 2018, as all penalties and fines will be effective from this date.

Explore:

Call the General Authority for Zakat and Tax's local hotline for VAT enquiries at 19993 with complaints, including if an invoice which does not mention the basic required information such as tax identification number or tax amount.

Download the app on the Apple and Google app stores  

Visit the KSA VAT portal

Deloitte has also prepared a free VAT in the GCC Guide mobile app, which can be downloaded on the Apple and Google app stores

Read PwC's discussion on VAT and the movement of goods between UAE and KSA

A number of businesses have already made statements online about VAT, including bank Emirates NBD, e-marketplace Souq.com, logistics firm TNT, and Zain Saudi Telecommunications Company.