VAT in Saudi Arabia: Register at SAR 375,000 Threshold

Businesses operating in Saudi Arabia are reminded that the mandatory threshold for registering under the Value Added Tax (VAT) system stands at SAR 375,000 in annual taxable supplies, measured over any rolling 12-month period or expected in the coming 12 months. Once a resident business reaches this figure, it must register for VAT.

For companies below the mandatory limit, voluntary registration is available once taxable supplies or taxable expenses reach SAR 187,500. Businesses whose annual taxable supplies fall below SAR 187,500 are not eligible to register. Non-resident persons making taxable supplies in the Kingdom face no threshold at all and must register from the first riyal, usually through a Saudi tax representative.

How and when to register

A taxable person must apply for VAT registration within 20 days of exceeding the SAR 375,000 threshold. Registration is completed online through the e-services portal of the Zakat, Tax and Customs Authority (ZATCA) — not through أبشر, مقيم, قوى, ناجز, نفاذ, or توكلنا. Applicants provide basic identification data, commercial registration details, an IBAN, and figures for taxable supplies and expenses for the past and coming 12 months. Registration is issued electronically with a VAT account and Tax Registration Number (TRN).

The standard VAT rate remains 15% in 2026. Once registered, a business must charge 15% VAT, issue compliant tax invoices, file VAT returns, and pay through ZATCA within the statutory deadlines. Returns are generally filed quarterly for small and medium taxpayers around the threshold, and monthly for larger taxpayers, using ZATCA's VAT return service, with payment made via SADAD or linked bank channels.

There is no separate official fee simply to obtain a VAT number; costs are compliance-related, such as advisory or software. Failing to register after exceeding the threshold can trigger administrative penalties, making timely action important for owners of small and growing businesses across the Kingdom.

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