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Kingdom of Saudi Arabia (KSA) VAT Registration

Updated

KSA - VAT Registration Requirements in Saudi Arabia

If you're storing inventory or fulfilling orders from within Saudi Arabia, VAT registration isn't just a good idea—it's a legal requirement. 

Here's everything you need to know to stay compliant and avoid costly penalties.

🧭 Key Information

In Saudi Arabia, VAT registration is mandatory if you store physical inventory in a local warehouse or fulfil orders from within the Kingdom.

✅ Tip: Even if you're a non-resident business, storing goods in KSA triggers VAT obligations.

⚠️ Penalties for Non-Compliance

Action Consequence
Failure to apply for VAT registration SAR 10,000 fine
Failure to submit VAT return 5%–25% of the undeclared tax
Failure to pay VAT due 5% of unpaid tax per month or part thereof
Issuing tax invoice without VAT registration Up to SAR 100,000 fine
Filing incorrect/amended VAT return resulting in lower tax due 50% of the difference between declared and actual tax
 

⚖️ Note: Penalties are enforced by the Zakat, Tax and Customs Authority (ZATCA). Learn more on ZATCA’s official site.

📝 Required Documents

To register for VAT in Saudi Arabia, you’ll need:

  • Proof of business activity in KSA (e.g. invoices)
  • Expected turnover in the next 30 days
  • Financial flowchart showing how funds are received by the non-resident company
  • Passport
  • Certificate of Incorporation / Formation / Status
  • Articles of Association
  • VAT certificate country of incorporation (not applicable for US clients, can ask for their EIN letter, which is an identification number for the business)
  • Company stamp for Letter of Intent and Power of Attorney (AVASK can assist with this service if not readily available)

📌 For Takeovers:

  • KSA VAT certificate
  • Login credentials from the previous agent for the online filing system

🔄 Registration Process

  1. Document Collection
    Gather all required documents, including financial and business activity evidence.
  2. Submission to ZATCA
    We’ll handle the submission through the ZATCA VAT portal.
  3. Certificate Issuance
    Once approved, you’ll receive your VAT certificate and login credentials for ongoing compliance.

⏳ Timeline: Registration typically takes a few weeks, depending on document readiness and ZATCA processing times.

📊 VAT Rates in Saudi Arabia

Rate Applies To
15% Standard rate – most goods and services
0% Certain exports, international transport, and specific exempt sectors
 

🔍 For full details, visit the ZATCA VAT Regulations page

🌍 Who This Applies To

This process applies to both EU and non-EU based businesses that store or fulfill goods from within Saudi Arabia.

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