Corporate Tax and Zakat landscape in Saudi Arabia

Corporate Tax and Zakat landscape in Saudi Arabia:

Saudi Arabia is one of the greatest economies in the GCC and a member of the G20. Despite this, taxes in Saudi Arabia remain low compared to other parts of the world, making it a paradise for investors and a lucrative destination for investment.

In Saudi Arabia, there are different taxations for Non-Saudi and GCC nationals. Non-Saudi investors pay income tax, while Saudi citizens (and citizens of GCC countries) pay Zakat, an Islamic assessment. If a company is owned by both Saudi and non-Saudi interests, the non-Saudi portion is subject to income tax, while the Saudi portion is subject to Zakat. The income tax rate is 20%, but income from oil and hydrocarbon production is taxed at a higher rate, ranging from 50% to 85%. Zakat is charged at 2.5% on the company's Zakat base.

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