TaxSavvySA

Audit required for foreign-owned micro company

We are a small LLC with an Indian owner. Do we need an audit?

The situation

Article 19 of the Companies Law lets micro and small companies skip the auditor, but the exemption does not apply to foreign micro and small companies. ZATCA also expects audited statements with returns of foreign and mixed companies.

The law

  • Art 19, Companies Law (audit exemption): Micro and small companies may be exempt from appointing an auditor; not foreign micro and small companies
  • Income Tax Law and Implementing Regulations, returns and advance payments: Return and final payment within 120 days of year end; advance payments of 25 percent of prior year tax unless below SAR 500,000

What it means for you

So a foreign-owned LLC needs a SOCPA-licensed auditor even if tiny. Book the auditor in the first quarter after year end, because the income tax return is due within 120 days and needs the audited statements. Then deposit the statements on Qawaem within six months.

What to do

  1. Appoint a SOCPA-licensed auditor.
  2. Close the books within 60 days.
  3. Attach audited statements to the return.
  4. File on Qawaem.

We can do this for youAnnual financial statements, statutory audit and Qawaem filing within six months: SAR 6,000

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