VAT Registration in Saudi Arabia: SAR 375,000 Rule

Businesses resident in Saudi Arabia are required to register for value-added tax (VAT) once their taxable supplies exceed SAR 375,000, either over the previous 12 months or where they are expected to cross that figure in the coming 12 months. The standard VAT rate remains 15%, with no rate change identified for 2026.

Registration is important for owners of small and medium enterprises across Riyadh, Jeddah, Dammam and other cities, as it affects invoicing, pricing and compliance obligations. It is worth noting that the threshold applies specifically to taxable supplies and not to total revenue, since exempt and out-of-scope supplies are generally excluded from the calculation.

How to register

Registration is completed electronically through the Taxpayer Portal on the tax authority's official website, and there is no registration fee. The service is not carried out through platforms such as أبشر, مقيم, قوى, ناجز, بلدي, توكلنا or اعتماد.

The steps are straightforward: log in to the portal, open the General Services section, select VAT Registration, then complete the business, taxable-supply, financial, bank-account and authorised-signatory details before submitting the application. Once processed, the authority sends a notification and issues the VAT certificate and VAT number.

Businesses that have not yet reached the mandatory threshold may still register voluntarily starting from SAR 187,500 in taxable supplies or eligible expenses. Registration stays active as long as the business continues to meet the applicable conditions, with no stated fixed expiry period, and any change in business details must be updated through the authority.

Non-resident businesses making taxable supplies inside Saudi Arabia are treated differently: the SAR 375,000 threshold does not generally apply to them, and registration may be required from the first taxable supply unless the reverse-charge conditions are met.

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