TaxSavvySA

Transfer pricing now applies to Zakat payers

We are a Saudi family group paying only Zakat. Do transfer pricing rules apply to us now?

The situation

ZATCA's 2023 amendments extend the transfer pricing provisions to all tax and Zakat paying entities for financial years starting on or after 1 January 2024.

The law

  • ZATCA Transfer Pricing Bylaws (15 February 2019, amended 7 April 2023): Arm's length rule; from years starting 1 January 2024 also applies to Zakat payers

What it means for you

Before 2024, pure Zakat payers were outside most TP filings. Now dealings between your group companies must be priced at arm's length and disclosed. Start by listing every intercompany sale, service, loan and guarantee for the year. CbCR also now covers Zakat payers in large groups.

What to do

  1. List related parties and transactions.
  2. Prepare the disclosure form with the return.
  3. Ask your auditor about the affidavit.

We can do this for youTransfer pricing compliance: disclosure form, auditor affidavit, Master File, Local File and CbCR check: SAR 6,000

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