VAT Registration – KSA ( Saudi Arabia)

Category : | Author :MasterGST

Following a public consultation in July and August, the Kingdom of Saudi Arabia (KSA) released final VAT regulations through the tax authority (GAZT) website on 29 August. This follows an earlier consultation process and the publishing of a domestic VAT law in July. The regulations, the law and the finalized GCC Framework Agreement form the entire foundations for the introduction of VAT across all sectors in KSA from 1 January 2018.

ERAD is the KSA’s online tax administration platform offering users functionality to register for, file and pay taxes in the Kingdom, amongst other things.

Resident and non-resident businesses performing taxable supplies must register with the tax authorities within 20 days of passing the VAT registration threshold. Businesses must evaluate if they have exceeded the threshold on a monthly basis. The registration threshold will be SAR375,000.

In this article, we will understand, ‘How to apply for VAT Registration in KSA’.

Registration process

Step 1: Register for Tax Identification Number (TIN)

The first step toward VAT Registration is to get the Tax Identification Number. This needs to get before the VAT Registration from the GAZT website. For the Registration of VAT TIN number, follow the procedure stated below.:

  • Click on ‘Login’ in GAZT’s website
  • After loading the page you will get button to signup, click on that
  • This page contains instructions to help taxpayers with the registration process. Read the terms and conditions and tick ‘I Agree’ to proceed
  • Sign up form will be available. select ‘New User Login’ and fill the all the details as required. After successful submission of all the details, TIN will be available for you to complete the VAT registration process.

Step 2: Login to GAZT Portal

After receiving the TIN, you need to login again to GAZT website to start the registration process. As shown below, you need to mention the username and password which you had mentioned while obtaining the TIN number.

Next, you need to authenticate the login using the login code sent to the registered mobile number as shown below:

Step 3: Select VAT registration from the Dashboard

After login into the GAZT’s portal, you will be able see the Dashboard as shown below. To navigate to the Registration page, you need to slide into the next page. On sliding to the next page, click ‘Register for Value Added Tax (VAT)

Step 4: Taxpayer details for VAT Registration

This is an important step in VAT Registration process. Here, you need to furnish details of your business and upload relevant supporting documents as required. The registration form will require you to specify 3 key details mentioned below:

  1. Taxpayers Details
  2. Financial Details
  3. Financial Representative
  4. Let us discuss the steps for completing the registration details.

After clicking on click ‘Register for Value Added Tax (VAT), the registration form as shown below will open:

This form Contains 5 Parts. They are

PART I: Instructions and conditions

The first page will instruct taxpayers regarding how to proceed through the registration. After reading, you need to tick ‘I Agree with these conditions and Proceed further’ in order to complete the registration process.

PART II: The taxpayer must give details like:

  • The IBAN (International Bank Account Number) to be associated with the business’s VAT account.
  • The date on which the business became eligible for VAT.
  • Whether the business is involved in import or export of goods/services.

Certain details like the business’s TIN (Tax Identification Number), CR (Commercial Registration number), and address are also listed. These details will be auto-filled by GAZT based on pre-existing records for each business.

PART III: Financial details

The part will contain the financial details, based on which the business’s VAT eligibility will be assessed. The following details need to be declared under financial details:

  • Projected taxable sales for the next year
  • Actual taxable sales for the last year
  • Projected taxable expenses for the next year
  • Actual taxable expenses for the last year

PART IV: Financial representative details (only mandatory if you are a non-KSA resident)

This section is applicable only for Non-residents. For Residents, this is optional and they may choose to skip this section. The non-resident need to provide the information about their designated tax representative in Saudi Arabia. Each non-KSA business will need to provide the following details of tax representatives:

  • TIN (if they have one)
  • ID number (such as a Saudi, Iqama, or GCC ID)
  • Mobile number
  • Email

PART V:Declaration

Finally, the applicant should confirm the accuracy of the submitted information and provide their name and ID number.

On clicking ‘Submit’, an application number will be available along with the acknowledgement which can be downloaded.

Step 5: Taxpayer details for VAT Registration

After Successful review and Approval VAT registration will be issued

Registration deadlines

GAZT has already opened up VAT registration for businesses. The deadline for VAT registration depends on the annual taxable sales of the business:

  • Businesses with annual taxable sales over 1,000,000 SAR must register by December 20, 2017,
  • Businesses with annual taxable sales less than 3,75,000 SAR and under 1,000,000 SAR must register by December 20, 2018.