Major VAT Changes Coming to KSA in Q32024

The KSA VAT Regulations are set to undergo a major overhaul with the new amendments proposed by the ZATCA in Q3 2024. Here are the key updates businesses need to be aware of:

1.?Tax Group Formation

Modifications to the criteria and processes for the formation of tax groups, including changes to ownership, control, and business practice requirements.

2.?Tax Group Registration Process

Changes to the registration process, including new requirements for documentation and acknowledgment of terms by tax group members.

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3.? Economic Activity Definition

Updated definitions and requirements for economic activities related to VAT registration and deregistration.

?4. Deemed Supply Rules

Amendments to the definitions and conditions under which supplies are considered deemed supplies.

?5.??Transfer of Economic Activities (TOGC Conditions)

New stipulations for the transfer of economic activities between taxable persons, including notification requirements and procedural adjustments.

?6. Special Economic Zones & VAT Suspension

New regulations specify the VAT treatment for transactions within special economic zones.

?7.?E-commerce

The updated regulations include specific responsibilities for the marketplace involved in supplying electronic services.

?8. Tax Refund for Non-resident Foreign Businesses

The tax refund process has been revamped. The new rules provide more clarity on application process, eligibility criteria, and provide procedural guidelines.

Conclusion

These amendments are crucial for businesses operating in KSA, as they will necessitate adjustments in processes and systems to ensure compliance.