Corporate income tax

Corporate income tax (CIT) in Saudi Arabia is governed by the Income Tax Law, originally enacted in 2004 via Royal Decree No. M/1, and applies to:

• Resident companies with foreign shareholding.
• Non-residents operating through branches or permanent establishments.

Saudi and GCC nationals are subject to Zakat instead of CIT.

The standard tax rate is 20 percent, with higher rates applicable to income derived from oil and hydrocarbon activities.

Taxpayers must file annual returns and pay any due amounts within the statutory deadlines, requiring certification in cases where revenues exceed SAR1 million by a Saudi-licensed CPA. Advance payments may also be triggered based on prior-year liabilities. Timely and accurate fulfillment of CIT obligations is key to maintaining compliance and avoiding penalties, while strategic tax planning within the CIT framework can drive operational efficiencies.

At KPMG, we support hundreds of clients in preparing and submitting tax returns, guiding them through every step of the compliance process. We work seamlessly across industries and business sizes to provide the most accurate advice.

Some of the services we offer to our clients include:

• Annual income tax returns
• Tax certification
• Assistance in advance tax payment
• Responding to ZATCA queries and audit requests
• Domestic tax advisory
• Holding tax-related information sessions
• Revision of financial models from a tax perspective
• Support with tax dispute resolution