🇸🇦 Corporate Tax in Saudi Arabia

Headline rate: 20% (foreign investors) / 2.5% Zakat (Saudi/GCC nationals)

Limited Liability Company (LLC)

Foreign investors pay 20% corporate income tax on their share of Saudi-source profits. Saudi and GCC nationals pay Zakat at 2.5% of the Zakat base (roughly net worth) instead of corporate tax. Mixed-ownership companies split profits proportionally between the tax and Zakat regimes. VAT applies at 15% on most goods and services (raised from 5% in July 2020). Withholding tax applies on payments to non-residents: 5% on dividends, 5% on interest, 15% on royalties and management fees (rates reducible under double tax treaties). Transfer pricing rules follow OECD guidelines.

Joint Stock Company (JSC)

JSC companies follow the same tax regime as LLCs: 20% corporate tax on the foreign shareholder portion, 2.5% Zakat on the Saudi/GCC portion. Public JSCs listed on Tadawul are subject to additional CMA reporting and disclosure requirements. VAT at 15% applies to all standard-rated supplies. Withholding tax rates on outbound payments are identical to those for LLCs.

Key Facts

Double tax treaties: 60
Memberships: GCC, WTO, OPEC, OPEC+, G20, UN, Arab League
Legal system: Sharia law with civil law elements; growing commercial law framework
Fiscal year: January – December (Gregorian) or Hijri — company's choice

This content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.