TaxSavvySA

Income tax or Zakat for freelancers

Do freelancers pay income tax in Saudi Arabia?

The situation

Saudi nationals with commercial activity fall under Zakat rules rather than income tax. Resident non-Saudi individuals carrying on activities in the Kingdom are within the income tax scope.

The law

  • Income Tax Law (Royal Decree M/1 of 1425H), corporate income tax: 20 percent on net adjusted profits of the non-Saudi, non-GCC share
  • Zakat Implementing Regulation, Ministerial Resolution 1007 (29 February 2024): Applies to financial years starting on or after 1 January 2024; 2.5 percent of the Zakat base

What it means for you

Salaries are not taxed, but business income can be. A Saudi freelancer working under a freelance document should confirm with ZATCA whether a Zakat registration applies to the activity. An expat running a business must register for income tax.

What to do

  1. Confirm your status with ZATCA.
  2. Keep income and expense records.
  3. File if required.

We can do this for youFreelancers in Saudi Arabia: freelance document for Saudis, legal routes for expats, VAT and tax: SAR 1,500

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