Saudi Arabia: Changes to Fiscal Representation requirements.
30th September 2019: Non-resident taxpayers welcome the change, which is expected to ease the burden of VAT compliance.
Foreign VAT-registered entities no longer need to appoint a local fiscal representative in KSA.
In an effort to make VAT compliance in Kingdom of Saudi Arabia (KSA) less of a burden for non-resident taxpayers, Saudi Arabia announced that they have amended their VAT laws and the obligatory requirement for foreign VAT-registered entities to appoint a local fiscal representative in Saudi Arabia has been removed by the General Authority of Zakat and Tax (GAZT).
On 1 January 2018, VAT was introduced to the region and since then non-resident businesses were required to appoint a local VAT agent for all their VAT needs.
New process for foreign VAT-registered entities in KSA.
Going forward, there is a requirement that foreign taxpayers without fiscal representation need to appoint a local accountant for record-keeping but the clients will now be able to contact the tax authorities directly through the GAZT portal.
The non-domestic entities will also need to set up a bank deposit or a bank guarantee with the GAZT to cover VAT obligations. This amount will be determined by the GAZT but it is estimated to be approximately six months of VAT liabilities.
If you are concerned by how this change may impact your business, contact our experts below.
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