Saudi Arabia: Changes to VAT, invoicing and customs charges

Transformation to e-invoicing

Zakat, Tax and Customs Authority (ZATCA) applied e-invoicing from 4 December 2021, and agreed to implementing regulations for e-invoicing on 4 December 2020.

Taxpayers were given 12 months to apply e-invoicing.

Also, all registered entities and taxpayers are required to comply with e-invoicing requirements.

The regulations of e-invoicing are applicable to taxable persons residing in the Kingdom of Saudi Arabia (KSA) as well as to any third party who issues a tax invoice on behalf of the taxable person residing in KSA. Non-resident taxable persons are not obligated to issue e-invoices.

VAT due date & approved amendments

ZATCA approved and made amendments to the implementing regulations of VAT, on articles:

• 53 ‘Tax Invoices’
• 54 ‘Credit and debit notes’
• 66 ‘Records’
   

These amendments took effect on 4 December 2021.

The main goal of the amendments is to make the VAT executive regulations consistent with the provisions and requirements of the e-invoicing regulations.

Amending the articles of the executive regulations of the unified customs system

According to the provisions of the GCC Unified Customs Law, customs taxes ‘duties’ shall be refunded in whole or in part on foreign goods re-exported outside the Gulf Cooperation Council (GCC) in accordance with the following requirements:

• That the exporter (re-exporter) is the importer in whose name the foreign goods are received, or any person who proves to the Customs Administration that they own them.
• The re-exported foreign goods whose customs duties are required to be refunded should be from one consignment, with the aim of identifying them and matching them with the import documents. The consignment may be re-exported in several parts of the same consignment if the part of the consignment fulfils all the conditions set forth in this article.
• The value of the foreign goods to be re-exported and the refund of customs taxes ‘duties’ collected on them shall not be less than SAR 20,000 (approximately EUR 4,800) or its equivalent in other GCC currencies.
• The claim for refunding the customs taxes ‘duties’ on foreign goods that were not used locally after their import from outside the GCC states, and in the same condition they were upon import.
• The foreign goods shall be re-exported within a calendar year from the date of payment of the customs taxes ‘duties’ on them when imported for the first time from outside the GCC countries.
• The request to refund the customs taxes ‘duties’ collected on foreign goods must be made within six calendar months from the date of re-export.
• The refund of customs taxes ‘duties’ shall be limited to those actually paid on foreign goods when imported.
• The customs taxes ‘duties’ shall be refunded after re-exporting the foreign goods that have been collected on them and verifying all the documents required for re-export.
   

Read the WTS Global VAT Newsletter here.