Start a business · Tax
VAT registration in Saudi Arabia
Saudi Arabia charges VAT at 15%. Whether your business must register depends on how much it sells. This guide covers the thresholds, the deadline and the registration steps, all taken from the Zakat, Tax and Customs Authority (ZATCA).
Short answer
Registration is mandatory once your annual revenue passes SAR 375,000, and optional between SAR 187,500 and SAR 375,000 (ZATCA). If you cross the mandatory threshold, apply within 30 days of the end of that month (VAT Implementing Regulations, Article 3). Registration is free, and you apply online on ZATCA’s website (ZATCA).
The VAT rate
The standard VAT rate in Saudi Arabia is 15%. It took effect on 1 July 2020 under Royal Order A/638 (ZATCA). Some supplies are zero-rated or exempt under the VAT Law and its Implementing Regulations.
Do you have to register?
| Annual revenue (12 months) | Registration |
|---|---|
| Above SAR 375,000 | Mandatory |
| Above SAR 187,500, up to SAR 375,000 | Optional (voluntary) |
| Below SAR 187,500 | Not required |
Source: ZATCA and ZATCA’s SME guide. Under the Implementing Regulations, voluntary registration can also be based on your expenses reaching the threshold, or on supplies or expenses you expect in the next 12 months (Article 3). That helps new businesses that spend heavily before they start selling.
How the 30-day deadline works
If you are a resident business that is not yet registered, at the end of each month add up your taxable supplies in Saudi Arabia for the previous 12 months. If the total is above the mandatory threshold, you must apply within 30 days of the end of that month. Your registration takes effect from the start of the month after you apply (VAT Implementing Regulations, Article 3).
Example of the counting (illustrative, not real data): if your rolling 12-month total first passes SAR 375,000 at the end of March, your 30 days run from the end of March.
How to register
ZATCA lists these steps for companies (ZATCA e-service, VAT journey):
- Log in to ZATCA’s website with your business account.
- Go to “General Services”, then “VAT Registration”.
- Fill out the registration form.
- You will be notified by SMS and email, and receive your VAT certificate, once the application is complete.
ZATCA says the service is free. Individuals doing business in their own name use a separate service, VAT Registration for Individuals, with the same thresholds.
After registering: returns
ZATCA’s SME guide (June 2023) says returns are filed monthly if your revenue exceeded SAR 40,000,000 in the past 12 months, and quarterly otherwise (ZATCA SME guide). You file through ZATCA’s e-services, and any amount due is paid with a SADAD invoice (ZATCA VAT journey).
E-invoicing (FATOORAH)
ZATCA rolled out e-invoicing in two phases (ZATCA):
- Phase one (generation): from 4 December 2021, all resident taxpayers must issue invoices through a compliant electronic solution.
- Phase two (integration): from 1 January 2023, in waves, the electronic solution must be integrated with ZATCA’s systems.
Phase two applies in waves, so check ZATCA’s e-invoicing pages to see when it applies to your business. Whatever the phase, choose invoicing software that is FATOORAH-compliant before you start selling.
Pricing with VAT
Once you are registered, VAT is part of every price you set. Our café and restaurant model works with VAT-inclusive menu prices, so you can see the margin you actually keep.
For zakat and income tax questions, our partner site Dariba.co covers Saudi tax in more depth. Back to the full route: how to start a business in Saudi Arabia.
Frequently asked questions
What is the VAT threshold in Saudi Arabia?
Registration is mandatory above SAR 375,000 in annual revenue and voluntary above SAR 187,500, according to ZATCA.
How long do I have to register once I pass the threshold?
Thirty days from the end of the month in which your 12-month taxable supplies exceeded the mandatory threshold, under Article 3 of the VAT Implementing Regulations.
Is VAT registration free?
Yes. ZATCA lists its VAT registration e-services as free.
What is the VAT rate in Saudi Arabia?
Fifteen percent, effective 1 July 2020.
How often do I file VAT returns?
According to ZATCA’s SME guide, monthly if your revenue exceeded SAR 40 million in the past 12 months, otherwise quarterly.
Sources
We opened and checked each official page below on 10 October 2026, except where marked. Where an official page did not state a figure, or we could not open it, we left the figure out instead of estimating it.
- ZATCA: VAT Registration for Individuals (e-service)
- ZATCA: VAT Registration for Businesses (e-service)
- ZATCA: Implementing Regulations of the VAT Law, PDF
- ZATCA news: 15% VAT rate takes effect (1 July 2020)
- ZATCA: What is e-invoicing (FATOORAH)?
- ZATCA: Guide for small and medium enterprises (June 2023), PDF
- ZATCA: VAT journey for establishments
How this guide was made. We drafted it with help from AI tools, working only from the official documents listed above. Every factual statement was checked against those documents on 10 October 2026 and reviewed by the About Financials editor before publication. This guide is general information, not legal or tax advice. Saudi procedures and fees change often, so confirm on the authority’s own portal before you apply or pay. Spotted something out of date? Let us know and we will correct it.
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