VAT REPRESENTATION

VAT REPRESENTATION FOR NON RESIDENT ENTITIES

With the introduction of Value Added Tax in Saudi Arabia from 01.01.2018, businesses are required to account for VAT on all transactions in KSA. Since foreign companies do not have permanent offices with a Tax reference in KSA, in such cases, it is required that a tax representative must be appointed to account for VAT on the income generated in KSA.

Key points to note

  • As per article number 77 paragraph 2, The Tax Representative shall be jointly liable for payment of any Tax due by the Taxable Person until such date the Tax Representative is confirmed by the Authority as ceasing to act on behalf of that Taxable Person.
  • As per article 66 paragraph 5, the company must maintain all invoices, records and accounting documents which related to activity with the representative.

In effect representative will be like an extended office of the company for all VAT purposes.