GAZT has published guidance on recovering VAT

The Kingdom of Saudi Arabia (KSA) General Authority of Zakat and Tax (GAZT) has published a new guideline on input tax deduction on its website. The guideline is currently only available in Arabic.  We will provide a link to the English version when it is published by GAZT.

Here are two key points of uncertainty which we understand GAZT has addressed in the guideline:

• Arabic invoicing – This is an issue that has caused many businesses some difficulty.  It now appears that while suppliers are still required to continue to issue valid tax invoices in Arabic, customers may be able to recover input VAT on English invoices in certain circumstances, if they have other evidence of having incurred the VAT (eg if they can show that payment has been made).
• Import VAT – We understand that GAZT has clarified that import VAT cannot be recovered on the import of goods not owned by the importer on the basis that the importer does not incur the VAT as part of its taxable business activities. Only the recipient of the supply (as distinct from an entity to which the goods supplied has been provided) can recover input VAT.