The Saudi Arabian Tax Authority has released draft VAT implementing regulations for public consultation, with VAT to be implemented on January 1, 2018. The standard VAT rate will be wide in scope with few exemptions. Key provisions in the draft regulations include registration requirements, VAT grouping rules, taxable financial services, exemptions for residential leasing and medical supplies, rules for government entities, and documentation requirements for invoices, returns, and record keeping. Businesses should assess the VAT impact and prepare compliance plans across key areas like finance, supply chain, and IT systems.
With VAT implementation taking effect in under six months, the Ministry of Finance have now provided further clarification of the rules which will be imposed in respect of VAT within the UAE, furthermore we have seen updates across Saudi Arabia recently, with announcements being made in respect of the registration process. This short alert from Grant Thornton UAE summarises the recent clarifications which the UAE have announced, alongside the registration elements required within Saudi Arabia.
The standard VAT rate will be 5% unless a zero rate or exemption applies.
The Member States have the right to subject the following sectors to a zero rate or to exempt them from VAT:
Education
Health
Real estate
Local transport
The Member States have the right to subject the oil sector, petroleum derivatives, and gas to a zero rate of VAT.
Individual GCC countries have the right to subject certain food products to a zero rate of VAT.
The Member States have the right to subject medical supplies to a zero rate of VAT.
Intra-GCC and international transport will be subject to a zero rate of VAT.
The export of goods to jurisdictions outside of the GCC Member States will be subject to a zero rate of VAT.
The Member States have the right to exempt Financial Services from VAT. The term financial services is not defined but broadly the exemption will generally relate to dealings in money, securities, foreign exchange and the operation and management of loan accounts, deposits, trade credit facilities and related intermediary services. The exemption is not expected to extend to fee based services transacted by a financial institution. However, Member States may choose to apply different VAT treatments to financial services if they wish.
Supplies of goods and services from a VAT registered person in one Member State to a VAT registered person in another Member State are subject to the reverse charge mechanism.
VAT grouping appears to be permitted between two or more legal persons resident in the same Member State.
The treatment of GCC free zones is not addressed and it is left to each Member State to determine its own VAT treatment for free zones.
Businesses with an annual revenue of over AED 375,000 will be required to register for VAT purposes.
Businesses with an annual revenue between AED 187,500 and AED 375,000 will have the option to register for VAT purposes.
UAE introducing VAT from January 2018 and this presentation gives full information regarding VAT concepts and applicability. Drop your query to us to discuss more about VAT in UAE at vat@nrdoshi.ae
Presentation on updates of VAT in UAE is in line with the various advisories issued by Ministry of Finance along with the expert views. VAT is being implemented in the UAE wef 1st January 2018. Presentation has impact of VAT/ Steps to follow to become VAT compliant/ thresholds for VAT registration with process to be followed.
With VAT implementation taking effect in under six months, the Ministry of Finance have now provided further clarification of the rules which will be imposed in respect of VAT within the UAE, furthermore we have seen updates across Saudi Arabia recently, with announcements being made in respect of the registration process. This short alert from Grant Thornton UAE summarises the recent clarifications which the UAE have announced, alongside the registration elements required within Saudi Arabia.
The standard VAT rate will be 5% unless a zero rate or exemption applies.
The Member States have the right to subject the following sectors to a zero rate or to exempt them from VAT:
Education
Health
Real estate
Local transport
The Member States have the right to subject the oil sector, petroleum derivatives, and gas to a zero rate of VAT.
Individual GCC countries have the right to subject certain food products to a zero rate of VAT.
The Member States have the right to subject medical supplies to a zero rate of VAT.
Intra-GCC and international transport will be subject to a zero rate of VAT.
The export of goods to jurisdictions outside of the GCC Member States will be subject to a zero rate of VAT.
The Member States have the right to exempt Financial Services from VAT. The term financial services is not defined but broadly the exemption will generally relate to dealings in money, securities, foreign exchange and the operation and management of loan accounts, deposits, trade credit facilities and related intermediary services. The exemption is not expected to extend to fee based services transacted by a financial institution. However, Member States may choose to apply different VAT treatments to financial services if they wish.
Supplies of goods and services from a VAT registered person in one Member State to a VAT registered person in another Member State are subject to the reverse charge mechanism.
VAT grouping appears to be permitted between two or more legal persons resident in the same Member State.
The treatment of GCC free zones is not addressed and it is left to each Member State to determine its own VAT treatment for free zones.
Businesses with an annual revenue of over AED 375,000 will be required to register for VAT purposes.
Businesses with an annual revenue between AED 187,500 and AED 375,000 will have the option to register for VAT purposes.
UAE introducing VAT from January 2018 and this presentation gives full information regarding VAT concepts and applicability. Drop your query to us to discuss more about VAT in UAE at vat@nrdoshi.ae
Presentation on updates of VAT in UAE is in line with the various advisories issued by Ministry of Finance along with the expert views. VAT is being implemented in the UAE wef 1st January 2018. Presentation has impact of VAT/ Steps to follow to become VAT compliant/ thresholds for VAT registration with process to be followed.
VAT is on the way of implementation in UAE from 1st of Jan 2018. It is critical for the companies to understand the nuances of the same and work on a roadmap to implement VAT so as to optimize the impact not only on profitability, working capital, pricing but also ERP, team sensitization and vendor education.
VAT is applied in more than 160 countries around the world as a reliable source of revenue for state budgets.
VAT is imposed at each stage of the supply chain from the production and distribution to the final sale of the good or service. The understanding concepts of “Supply”, “Place of Supply” and “Time of Supply” become critically important for effective implementation of UAE VAT.
Here is a simple graphical guide for understanding the UAE VAT.
VAT Implementation in KSA (Kingdom of Saudi Arabia)Mitesh Katira
VAT is on the way of implementation in the KSA from 1st of Jan 2018. It is critical for the companies to understand the nuances of the same and work on a roadmap to implement VAT so as to optimize the impact not only on profitability, working capital, pricing but also ERP, team sensitization and vendor education.
VAT is applied in more than 160 countries around the world as a reliable source of revenue for state budgets.
VAT is imposed at each stage of the supply chain from the production and distribution to the final sale of the good or service. The understanding concepts of “Supply”, “Place of Supply” and “Time of Supply” become critically important for effective implementation of KSA VAT.
Here is a simple graphical guide for understanding the KSA VAT.
Most business activities and investments in Vietnam will be affected by the following taxes:
Corporate income tax;
Various withholding taxes;
Capital assignment profits tax;
Value added tax;
Import duties;
Personal income tax of Vietnamese and expatriate employees;
Social insurance, unemployment insurance and health insurance contributions.
There are various other taxes that may affect certain specific activities, including:
Special sales tax;
Natural resources tax;
Property taxes;
Export duties;
Environment protection tax.
All these taxes are imposed at the national level. There are no local, state or provincial taxes.
UAE VAT Law Executive Regulations (Draft) have been issued
UAE's Federal Tax Authority has issued the (Draft) VAT Executive Regulations today. You can download it here
What to do next?
Companies should now act fast to get themselves VAT compliant and apply for VAT registration.
How BMS AUDITING CAN HELP ?
At BMS AUDITING we are helping many companies to get VAT implemented successfully through our UK Experienced VAT experts. . We provide end to end VAT implementation services across UAE, in all Emirates
Grant Thornton VAT Club: Global VAT/GST Update June 2017Alex Baulf
Slides from the high level Global VAT/GST update delivered by Grant Thornton's International Indirect Tax team at the London VAT Club event on Wednesday 21st June 2017. This includes:
GCC VAT update – UAE and Saudi Arabia
Brazil – PIS/COFINS tax base to exclude ICMS
EU – ECOFIN reject General Reverse Charge
Poland - Proposed extension to SAF-T
Australia - Netflix Tax and Low Value Imports
China - VAT rate simplification
Taiwan - Digital services
India - GST Implementation
Italy – VAT rate changes, split payment mechanism …
France – Anti-Fraud VAT software requirements
Switzerland – Non-resident threshold reduced
Spain – SII reporting
Cyprus – Electronic submission of VAT returns
Argentina - Proposal to reduce VAT rates and modifications to turnover tax
Bahamas – Transparency in the administration of VAT collection proposed
VAT is on the way of implementation in UAE from 1st of Jan 2018. It is critical for the companies to understand the nuances of the same and work on a roadmap to implement VAT so as to optimize the impact not only on profitability, working capital, pricing but also ERP, team sensitization and vendor education.
VAT is applied in more than 160 countries around the world as a reliable source of revenue for state budgets.
VAT is imposed at each stage of the supply chain from the production and distribution to the final sale of the good or service. The understanding concepts of “Supply”, “Place of Supply” and “Time of Supply” become critically important for effective implementation of UAE VAT.
Here is a simple graphical guide for understanding the UAE VAT.
VAT Implementation in KSA (Kingdom of Saudi Arabia)Mitesh Katira
VAT is on the way of implementation in the KSA from 1st of Jan 2018. It is critical for the companies to understand the nuances of the same and work on a roadmap to implement VAT so as to optimize the impact not only on profitability, working capital, pricing but also ERP, team sensitization and vendor education.
VAT is applied in more than 160 countries around the world as a reliable source of revenue for state budgets.
VAT is imposed at each stage of the supply chain from the production and distribution to the final sale of the good or service. The understanding concepts of “Supply”, “Place of Supply” and “Time of Supply” become critically important for effective implementation of KSA VAT.
Here is a simple graphical guide for understanding the KSA VAT.
Most business activities and investments in Vietnam will be affected by the following taxes:
Corporate income tax;
Various withholding taxes;
Capital assignment profits tax;
Value added tax;
Import duties;
Personal income tax of Vietnamese and expatriate employees;
Social insurance, unemployment insurance and health insurance contributions.
There are various other taxes that may affect certain specific activities, including:
Special sales tax;
Natural resources tax;
Property taxes;
Export duties;
Environment protection tax.
All these taxes are imposed at the national level. There are no local, state or provincial taxes.
UAE VAT Law Executive Regulations (Draft) have been issued
UAE's Federal Tax Authority has issued the (Draft) VAT Executive Regulations today. You can download it here
What to do next?
Companies should now act fast to get themselves VAT compliant and apply for VAT registration.
How BMS AUDITING CAN HELP ?
At BMS AUDITING we are helping many companies to get VAT implemented successfully through our UK Experienced VAT experts. . We provide end to end VAT implementation services across UAE, in all Emirates
Grant Thornton VAT Club: Global VAT/GST Update June 2017Alex Baulf
Slides from the high level Global VAT/GST update delivered by Grant Thornton's International Indirect Tax team at the London VAT Club event on Wednesday 21st June 2017. This includes:
GCC VAT update – UAE and Saudi Arabia
Brazil – PIS/COFINS tax base to exclude ICMS
EU – ECOFIN reject General Reverse Charge
Poland - Proposed extension to SAF-T
Australia - Netflix Tax and Low Value Imports
China - VAT rate simplification
Taiwan - Digital services
India - GST Implementation
Italy – VAT rate changes, split payment mechanism …
France – Anti-Fraud VAT software requirements
Switzerland – Non-resident threshold reduced
Spain – SII reporting
Cyprus – Electronic submission of VAT returns
Argentina - Proposal to reduce VAT rates and modifications to turnover tax
Bahamas – Transparency in the administration of VAT collection proposed
Goods and Services Tax is a destination based tax on consumption of goods and services. It is proposed to be levied at all stages right from manufacture up to final consumption with credit of taxes paid at previous stages available as set off. In a nutshell, only value addition will be taxed and burden of tax is to be borne by the final consumer.
Welcome to our guide for Taxation in Vietnam. In this guide, we hope to provide you with an overview of the key aspects of Taxation in Vietnam and answer many of the questions that foreign businesses and entrepreneurs have when making their first venture into the Vietnamese market.
Impact of Modi Budget 2014 on Specific Sectors...
Dear Friends,
It gives us a pleasure to present the summary of India Budget Synthesis 2014.
While you may already have the snapshot, here is a document which will not only give you crisp highlights, but would also decode the impact of Budget 2014 on You, Your Company and Your Sector.
Hope you find this analysis useful in taking clearer business decisions and align your company's strategy with the overall economic climate in the balance part of financial year 2014-15.
Would love to hear your feedback on the usefulness of the same."
Regards,
Vishal Thakkar | Group Head - Corporate Relations | Synthesis Group
Hand Phone: 91 9320007891 | Boardline: 91 22 24093737 | Fax: 91 22 24093737
Here is the comprehensive details of direct tax proposal, budget 2016. The NCLT provides complete coverage of the Companies Act 2013, Companies Act 1956 and related rules, notifications, circulars, orders, forms etc.
https://www.nclt.in/
GAZT VAT guide on Financial Services - EnglishFarhan Osman
This guideline is directed for businesses involved in the Financial Services sector, including commercial banks, insurers, asset financing companies; or any business that provides financial services as part of its overall activities.
The method and procedure for VAT registration in UAE is rather straightforward, and to register for VAT, our VAT Experts will guide you along with the complete procedure.
Grant Thornton Hungary Tax News - November 2014 en (2)Alex Baulf
Tax Service News from Grant Thornton Hungary:
Grant Thornton Hungary would like to call your attention to the most important tax law changes. Most of the changes will enter into force by 1 January 2015. We indicate separately, if legislation enters into force at a different date.
The information provided herein is of general nature and is based on facts subject to change. Such information may not be regarded and therefore in no way interpreted as accountancy, legal or taxation advice provided to the reader by Grant Thornton Hungary. These materials are not aimed at complying with particular scenarios and to be suitable for application in certain situations, therefore the consideration of certain taxation law and other factors not
discussed herein may be necessary. With regard to this – should you resolve upon any action whatsoever based on the information provided herein – it is recommended to establish contact with Grant Thornton Hungary or other taxation specialists. Amendments of the taxation laws and other factors may influence the contents communicated herein – in certain cases even with retroactive effect. Grant Thornton Hungary assumes no responsibility of informing the readers of these changes.
Welcome to TechSoup New Member Orientation and Q&A (May 2024).pdfTechSoup
In this webinar you will learn how your organization can access TechSoup's wide variety of product discount and donation programs. From hardware to software, we'll give you a tour of the tools available to help your nonprofit with productivity, collaboration, financial management, donor tracking, security, and more.
Introduction to AI for Nonprofits with Tapp NetworkTechSoup
Dive into the world of AI! Experts Jon Hill and Tareq Monaur will guide you through AI's role in enhancing nonprofit websites and basic marketing strategies, making it easy to understand and apply.
Instructions for Submissions thorugh G- Classroom.pptxJheel Barad
This presentation provides a briefing on how to upload submissions and documents in Google Classroom. It was prepared as part of an orientation for new Sainik School in-service teacher trainees. As a training officer, my goal is to ensure that you are comfortable and proficient with this essential tool for managing assignments and fostering student engagement.
Honest Reviews of Tim Han LMA Course Program.pptxtimhan337
Personal development courses are widely available today, with each one promising life-changing outcomes. Tim Han’s Life Mastery Achievers (LMA) Course has drawn a lot of interest. In addition to offering my frank assessment of Success Insider’s LMA Course, this piece examines the course’s effects via a variety of Tim Han LMA course reviews and Success Insider comments.
Model Attribute Check Company Auto PropertyCeline George
In Odoo, the multi-company feature allows you to manage multiple companies within a single Odoo database instance. Each company can have its own configurations while still sharing common resources such as products, customers, and suppliers.
Acetabularia Information For Class 9 .docxvaibhavrinwa19
Acetabularia acetabulum is a single-celled green alga that in its vegetative state is morphologically differentiated into a basal rhizoid and an axially elongated stalk, which bears whorls of branching hairs. The single diploid nucleus resides in the rhizoid.
The Roman Empire A Historical Colossus.pdfkaushalkr1407
The Roman Empire, a vast and enduring power, stands as one of history's most remarkable civilizations, leaving an indelible imprint on the world. It emerged from the Roman Republic, transitioning into an imperial powerhouse under the leadership of Augustus Caesar in 27 BCE. This transformation marked the beginning of an era defined by unprecedented territorial expansion, architectural marvels, and profound cultural influence.
The empire's roots lie in the city of Rome, founded, according to legend, by Romulus in 753 BCE. Over centuries, Rome evolved from a small settlement to a formidable republic, characterized by a complex political system with elected officials and checks on power. However, internal strife, class conflicts, and military ambitions paved the way for the end of the Republic. Julius Caesar’s dictatorship and subsequent assassination in 44 BCE created a power vacuum, leading to a civil war. Octavian, later Augustus, emerged victorious, heralding the Roman Empire’s birth.
Under Augustus, the empire experienced the Pax Romana, a 200-year period of relative peace and stability. Augustus reformed the military, established efficient administrative systems, and initiated grand construction projects. The empire's borders expanded, encompassing territories from Britain to Egypt and from Spain to the Euphrates. Roman legions, renowned for their discipline and engineering prowess, secured and maintained these vast territories, building roads, fortifications, and cities that facilitated control and integration.
The Roman Empire’s society was hierarchical, with a rigid class system. At the top were the patricians, wealthy elites who held significant political power. Below them were the plebeians, free citizens with limited political influence, and the vast numbers of slaves who formed the backbone of the economy. The family unit was central, governed by the paterfamilias, the male head who held absolute authority.
Culturally, the Romans were eclectic, absorbing and adapting elements from the civilizations they encountered, particularly the Greeks. Roman art, literature, and philosophy reflected this synthesis, creating a rich cultural tapestry. Latin, the Roman language, became the lingua franca of the Western world, influencing numerous modern languages.
Roman architecture and engineering achievements were monumental. They perfected the arch, vault, and dome, constructing enduring structures like the Colosseum, Pantheon, and aqueducts. These engineering marvels not only showcased Roman ingenuity but also served practical purposes, from public entertainment to water supply.
The French Revolution, which began in 1789, was a period of radical social and political upheaval in France. It marked the decline of absolute monarchies, the rise of secular and democratic republics, and the eventual rise of Napoleon Bonaparte. This revolutionary period is crucial in understanding the transition from feudalism to modernity in Europe.
For more information, visit-www.vavaclasses.com
Unit 8 - Information and Communication Technology (Paper I).pdfThiyagu K
This slides describes the basic concepts of ICT, basics of Email, Emerging Technology and Digital Initiatives in Education. This presentations aligns with the UGC Paper I syllabus.
June 3, 2024 Anti-Semitism Letter Sent to MIT President Kornbluth and MIT Cor...Levi Shapiro
Letter from the Congress of the United States regarding Anti-Semitism sent June 3rd to MIT President Sally Kornbluth, MIT Corp Chair, Mark Gorenberg
Dear Dr. Kornbluth and Mr. Gorenberg,
The US House of Representatives is deeply concerned by ongoing and pervasive acts of antisemitic
harassment and intimidation at the Massachusetts Institute of Technology (MIT). Failing to act decisively to ensure a safe learning environment for all students would be a grave dereliction of your responsibilities as President of MIT and Chair of the MIT Corporation.
This Congress will not stand idly by and allow an environment hostile to Jewish students to persist. The House believes that your institution is in violation of Title VI of the Civil Rights Act, and the inability or
unwillingness to rectify this violation through action requires accountability.
Postsecondary education is a unique opportunity for students to learn and have their ideas and beliefs challenged. However, universities receiving hundreds of millions of federal funds annually have denied
students that opportunity and have been hijacked to become venues for the promotion of terrorism, antisemitic harassment and intimidation, unlawful encampments, and in some cases, assaults and riots.
The House of Representatives will not countenance the use of federal funds to indoctrinate students into hateful, antisemitic, anti-American supporters of terrorism. Investigations into campus antisemitism by the Committee on Education and the Workforce and the Committee on Ways and Means have been expanded into a Congress-wide probe across all relevant jurisdictions to address this national crisis. The undersigned Committees will conduct oversight into the use of federal funds at MIT and its learning environment under authorities granted to each Committee.
• The Committee on Education and the Workforce has been investigating your institution since December 7, 2023. The Committee has broad jurisdiction over postsecondary education, including its compliance with Title VI of the Civil Rights Act, campus safety concerns over disruptions to the learning environment, and the awarding of federal student aid under the Higher Education Act.
• The Committee on Oversight and Accountability is investigating the sources of funding and other support flowing to groups espousing pro-Hamas propaganda and engaged in antisemitic harassment and intimidation of students. The Committee on Oversight and Accountability is the principal oversight committee of the US House of Representatives and has broad authority to investigate “any matter” at “any time” under House Rule X.
• The Committee on Ways and Means has been investigating several universities since November 15, 2023, when the Committee held a hearing entitled From Ivory Towers to Dark Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt Universities, and Terror Financing. The Committee followed the hearing with letters to those institutions on January 10, 202
Overview on Edible Vaccine: Pros & Cons with Mechanism
vat implementing regulations for public consultation
1. Executive summary
Saudi Arabia’s Tax Authority, General Authority of Zakat and Tax (GAZT), has
released a draft bilingual version of the Value-added Tax (VAT) Implementing
Regulations (the Bylaw) on its portal for public consultation. With the official
publication of the finalized VAT law in the Saudi Gazette, businesses should be
able to assess their operation and prepare for the implementation of VAT on
1 January 2018.
The scope of the standard rate VAT is wide and there are very few zero-rated or
exempt items, as food, health, education and first sale of residential property
are not zero-rated.
Detailed discussion
Key provisions
The key provisions of the Bylaw are:
Registration of small business units with GAZT – Small businesses with
turnover below SAR1m (approx. US$267k) will be given an additional year
to register with the GAZT, i.e., until 1 January 2019. This will enable smaller
businesses to prepare and be VAT-ready.
2 August 2017
Indirect Tax Alert
Saudi Arabian Tax
Authority releases
VAT Implementing
Regulations for
public consultation
EY Global Tax Alert Library
Access both online and pdf versions
of all EY Global Tax Alerts.
Copy into your web browser:
www.ey.com/taxalerts
2. 2 Indirect Tax Alert
The Bylaw sets out the mandatory electronic registration
requirements which are expected to be open for VAT
registrations from September 2017. This is notwithstanding
that the GAZT have commenced the process for registering
large businesses (revenues in excess of SAR40m) (approx.
US$10.7m) and very large businesses (revenues in excess
of SAR2b).
VAT grouping – If a group of companies’ share common
control (ownership control) of more than 50%, they will be
considered for VAT grouping. The VAT grouping provisions
of the Bylaw includes an anti-avoidance measure, whereby
a VAT group may be set aside or disallowed, if the main
purpose of the group is to obtain a tax advantage. However,
it will be difficult to reconcile this anti-avoidance measure
with a taxpayer or group of taxpayers’ intentions regarding
possible tax advantages. This is likely to give rise to potential
tax litigation in the future.
Financial services supply – Financial services supplies,
including Islamic finance products are exempt from VAT.
Consideration received for services rendered by banks by
way of explicit fees, commission or commercial discount,
will be subject to VAT at the standard rate. Exempt financial
services supplies may be summarized as follows:
• Interest or lending fees charged with an implicit margin for
any form of lending, including loans and credit cards
• Interest or lending fees charged with an implicit margin for
a mortgage or under a diminishing musharaka arrangement
• Interest or lending fees charged with an implicit margin for
short term finance, including finance leasing, hire purchase
products or under a murabaha contract
• Commissions charged on an implicit margin or spread for
brokerage services, or under a mudaraba or wakala contract
• The issue or transfer of a debt security, equity security, or
any other transferable document recognizing an obligation
to pay a monetary amount to the bearer
In respect of insurance services, life insurance is exempt,
whereas general insurance is subject to the standard VAT rate.
Residential supplies – Residential real estate leasing or
licensing, (excluding hotels, inns, guesthouses, motels,
serviced apartments or other temporary accommodation)
are exempt from VAT.
Medical supplies – Qualifying medicines (list of medicines
approved by the Ministry of Health) or medical goods (goods
licensed by the Saudi Food and Drug Authority (SFDA))
dispensed to an individual for personal use on an authorized
prescription is zero-rated, provided that such dispensing is
carried out by a registered pharmacist, an SFDA-licensed
distributor, a primary health care center or in a hospital.
Those supplies rendered earlier in the supply chain that do
not adhere to these requirements will be taxable, i.e., only
the supply to the individual recipient will be zero-rated or
exempted.
Government authorities – Government authorities are
not considered to be carrying on an economic activity
and therefore not required to register for VAT. However,
if they are involved in the supply of goods and services in
competition with the private sector, they would be considered
to be carrying on an economic activity. In such instances,
they will be required to be registered for VAT, if they meet
the threshold registration requirements. A government
authority may apply for a certificate from the tax authority,
which they can quote to the suppliers making the zero-rated
supplies. Based on this, the government authority entity can
also apply the reverse charge mechanism.
Transfer of going-concern – In the case of a going concern,
when an economic activity is transferred, it will not be subject
to VAT, provided certain conditions are satisfied. This is a
positive development considering the fact that going concern
transactions are among the most disputed transactions in
other VAT jurisdictions.
Reverse charge mechanism – Taxpayers can adopt the
reverse charge mechanism on the importation of goods
into Saudi Arabia, provided the taxpayer has a proven track
record as a compliant taxpayer for the previous 12 months.
Method of VAT calculation – Taxpayers supplying used motor
vehicles can adopt the profit margin method of VAT calculation.
Supply of vouchers – Supplies of vouchers are not subject to
VAT, where the consideration is equal to or less than the face
value of the voucher.
Input tax credits – For acquisitions made up to six months
before registration, special rules need to be applied for claiming
input tax credits. Input tax credits cannot be deducted for:
• Entertainment, sporting or cultural events
• Catering services in hotels, restaurants and similar venues
• Purchase or lease of motor vehicles used or made available
for private use (restricted motor vehicles) and any costs
associated with restricted motor vehicles, any other private
or non-business goods or services
3. Indirect Tax Alert 3
Special rules apply for claiming input tax credits for
acquisitions made up to six months before registration.
Deduction methodology – The proportional deduction for
non-direct attributed acquisitions is based on the taxable
sales of the previous calendar year divided by total sales for
the same period. Capital assets are excluded from the above
calculation. Adjustments need to be made in the final tax
return when the actual amounts are known. Taxpayers may
also apply for alternative methods. However, the de minimus
rule is not available.
Capital assets – The adjustment period for deduction of
input tax credits in relation to change in the use of capital
assets is 6 years for tangible or intangible capital assets and
10 years in respect of immovable capital assets or the useful
life of the capital asset where it is less than the 6 or 10 years.
Such adjustments are required every 12 months.
Tax invoices – Tax invoices must be issued by the 15th day
of the month following the month of taxable event. It is
anticipated that this is likely to create problems when
suppliers delay the issuance of tax invoices.
The VAT amount payable (in Saudi riyals) is required be
shown in Arabic. The Tax Identification Number (TIN) of
the customer need not be shown in the tax invoice. The
simplified tax invoice requirements include stating the tax
payable or the amount inclusive of tax.
Debit and credit notes – The requirements for debit and credit
notes are detailed in the Bylaw. Debit and credit notes must
include reference to the sequential number of the tax invoice.
Details of the tax return – A tax return should include the
following details:
• Total value of taxable supplies and zero rated supplies
• Total acquisitions
• Total deductible input tax
• Total value of nominal supplies
• Total value of supplies subject to the reverse charge
mechanism
• Total value of internal supplies
• Total tax on imports
• Total value of exempt supplies
• Other supplies
• Value of adjustments (proportional deduction of input tax)
• Adjustment made on the change of use of capital assets
• Corrections related to previous returns
It is likely that this extensive list of required disclosures will
prove to be a challenge to incorporate or implement taking
into consideration the required number of tax codes and
general ledger codes.
Amendment of tax return – Errors greater than SAR5k
(Approx. US$1.3k) requires the previous tax return to be
amended. Where tax evasion or intentional breaching of
provisions are found, the limitation period for amendment
of assessment can range up to 20 years.
Tax records – Records must be kept for 6 years from the end
of the tax period and in relation to capital assets, these must
be maintained for a 6 or 10 year period as the case maybe,
plus 5 years.
Grandfathering provisions – In case of grandfathering
provisions for contracts, the customer must certify that they
are able to claim the input tax in full. An application to the
tax authority is not required in this respect and the regulation
does not stipulate any minimum value for these contracts.
Note: The above comments are based on the draft version of
the VAT Bylaw (based on unofficial translations) and likely to
be subject to change.
Next steps
The GAZT is conducting various sessions to actively engage
with business groups to increase awareness on the proposed
VAT and its impact on their businesses. It is imperative for
businesses operating in the Gulf Cooperation Council (GCC)
region to take immediate steps to become compliant with the
respective GCC Member State’s VAT laws.
GCC businesses should initiate a VAT impact assessment
immediately in order to determine the impact of VAT across
their operations. This assessment should consider the VAT
impact on the following key areas:
• Finance and accounting IT and systems
• Tax and compliance
• Supply chain – goods and services
• Contracts
• Sales and marketing
• Legal structure
• Human resources
The impact assessment should be used to develop a clear
plan detailing the steps that must be taken to be ready for
the VAT go live date of 1 January 2018.
4. 4 Indirect Tax Alert
For additional information with respect to this Alert, please contact the following:
Ernst & Young & Co (Public Accountants), Riyadh, Saudi Arabia
• Amr Farouk +966 11 215 9898 amr.farouk@sa.ey.com
• Ahmed Hassanin +966 11 273 4740 ahmed.hassanin@sa.ey.com
• Sujit Narayanan +966 11 214 6902 sujit.narayanan@xe04.ey.com
Ernst & Young & Co (Public Accountants), Jeddah, Saudi Arabia
• Rolf Winand +966 2 221 8400 rolf.winand@sa.ey.com
Ernst & Young, Doha, Qatar
• Finbarr Sexton, MENA Indirect Tax Leader +974 4457 4200 finbarr.sexton@qa.ey.com
• Filip Van Driessche, VAT Implementation Leader +974 4457 4271 filip.vandriessche@qa.ey.com
• Jennifer O’Sullivan, VAT Implementation Leader +974 4457 4116 jennifer.osullivan@qa.ey.com
• Andrew Vye +974 4457 4287 andrew.vye@qa.ey.com
• Deepak Divakaran +974 4457 4259 deepak.divakaran@qa.ey.com
Ernst & Young Middle East, Dubai Branch, UAE
• David Stevens, VAT Implementation Leader +971 4 332 4000 david.stevens@ae.ey.com
• Michael Hendroff +971 4 332 4000 michael.hendroff@ae.ey.com
• Engela Wiid +971 4 332 4000 engela.wiid@ae.ey.com
• Mark McKay +971 4 332 4000 mark.mckay@ae.ey.com
• Martin Lazaroff +971 4 332 4000 martin.lazaroff@ae.ey.com
• Nicola Butt +971 4 701 0100 nicola.butt@ae.ey.com
• Samuel H Jong Lim +971 4 701 0659 hengjong.lim@ae.ey.com
Ernst & Young Middle East, Abu Dhabi Branch, UAE
• James Bryson +971 2417 4485 james.bryson@ae.ey.com
• Sana Azam +974 5005 4085 sana.azam@ae.ey.com
Ernst & Young (Al-Aiban, Al-Osaimi & Partners), Safat, Kuwait
• Alok Chugh +965 2295 5000 alok.chugh@kw.ey.com
• Tuhin Chaturvedi +965 2295 5365 tuhin.chaturvedi@kw.ey.com
• Munjal Mehta +965 2295 5382 munjal.mehta@kw.ey.com
Ernst & Young LLC, Muscat, Oman
• Alkesh Joshi +968 24 559 558 alkesh.joshi@om.ey.com
• Mitul Patel +968 24 559 569 mitul.patel@om.ey.com
Ernst & Young Consulting W.L.L., Manama, Bahrain
• Ivan Zoricic +973 1751 4768 ivan.zoricic@bh.ey.com
• Shankar P B +973 1751 4762 shankar.pb@bh.ey.com
• Jack Sims +973 1751 5455 jack.sims@bh.ey.com
Ernst & Young LLP, Middle East Tax Desk, Houston
• Gareth Lewis +1 713 750 1163 gareth.lewis1@ey.com