This post explains Saudi Arabia’s VAT (KSA) in clear English: the current rate, what is zero-rated or exempt, registration thresholds (mandatory & voluntary), filing periods, FATOORAH e-invoicing, practical calculation examples and a simple VAT calculator you can use on the page.
Last updated: 2025
VAT (Value Added Tax) is applied to most goods and services supplied in the Kingdom. The Zakat, Tax and Customs Authority (ZATCA) administers VAT, registration and filing rules in Saudi Arabia. Businesses must charge VAT on taxable supplies, collect it from customers and remit it to ZATCA.
| Category | Rate | Examples / Notes |
|---|---|---|
| Standard-rated | 15% | Most domestic supplies of goods & services and imports (unless specifically zero-rated or exempt). |
| Zero-rated | 0% | Exports of goods & services, certain international transport, qualifying healthcare & education exports (conditions apply). |
| Exempt / Out of scope | — | Some financial services, certain residential supplies — input VAT recovery rules differ for exempt supplies. |
Mandatory registration: Any person or business whose annual taxable supplies exceed SAR 375,000 must register for VAT with ZATCA. Voluntary registration is available for businesses whose annual taxable supplies are between SAR 187,500 and SAR 375,000 (it can allow recovery of input VAT). Businesses below SAR 187,500 are generally not required to register.
ZATCA e-Services / VAT Registration portal: register and manage your VAT account via ZATCA online services.
ZATCA sets filing periods depending on taxpayer size and risk profile. Many businesses file quarterly, while larger taxpayers (or those required by ZATCA) may file monthly. ZATCA may allow approved changes to your filing period; always check your VAT portal for specific deadlines and due dates.
Saudi Arabia implemented mandatory e-invoicing (FATOORAH) in phases. Taxpayers are onboarded in waves based on turnover and category; e-invoicing requires either using ZATCA integration or compliant solutions. Ensure your accounting / POS software supports the FATOORAH format and integrate ahead of your wave date.
Net price: SAR 1,000 → VAT (15%) = SAR 150 → Total = SAR 1,150
Gross price: SAR 1,150 → VAT portion = 1,150 × (15/115) = SAR 150 → Net price = SAR 1,000
ZATCA enforces penalties for late registration, late filing, incorrect returns and late payment. From time to time ZATCA has introduced temporary penalty relief measures — check the ZATCA website or your VAT portal for the latest announcements and any active relief windows.
A: The standard VAT rate is 15%.
A: Mandatory registration applies when annual taxable supplies exceed SAR 375,000. Voluntary registration is possible from SAR 187,500.
A: FATOORAH is the Saudi mandatory e-invoicing system. Taxpayers are assigned waves — you must issue & store invoices in the approved electronic format and integrate with your accounting / POS systems as required.
A: Many businesses file quarterly; large taxable persons may be required to file monthly. Check your ZATCA VAT account for your assigned period and due dates.
A: Generally yes, if purchases are for taxable business activities and you have valid tax invoices — subject to normal input VAT recovery rules and restrictions.
ZATCA — VAT rules & guidance | ZATCA — VAT registration e-Service
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