Accounting and audit support in Saudi Arabia

Saudi Arabia is the country in this group where the language of the records and the place they are stored are conditions in their own right. Failing them has a named consequence rather than a fine: the authority stops reading your figures and works out its own.

Language and location are conditions here rather than preferences, which is why the set-up decides more than it does elsewhere. The cycle on its own, with the jurisdiction taken out, is accounting support. Everything else we take on locally is listed by our Saudi Arabia page.

Three conditions on the records themselves

Arabic

All supporting documents and clarifications for the declaration are provided in Arabic, and a foreign company submits a certified translation of what it holds in another language.

Inside the Kingdom

Commercial books and their supporting documents are kept in the country. A resident with a permanent establishment may hold the computer abroad only where the branch here has a local terminal through which all of the data can be reached.

Ten years

Commercial books, correspondence and documents are held at least ten years at the taxpayer's headquarters, and printed data is extracted from the system quarterly.

When an auditor is required, and when a signature replaces one

Every payer required to maintain commercial books attaches financial statements audited by an accountant licensed by the professional organisation for accountants. The companies law that took effect on 19 January 2023 lifts that duty from micro and small companies meeting two of three tests: annual income no higher than 10,000,000 riyals, assets no higher than 10,000,000 riyals, and a workforce of no more than forty-nine.

The relief is claimed, not granted. On filing the statements the director or chairman attaches a statement confirming both that the requirement does not apply and that no partner or shareholder holding the share the law names has asked for an auditor. One such request puts the auditor back.

What happens when the books are not there

• The base is computed by formula: sales divided by eight, plus fifteen per cent of sales.
• Sales may not be taken lower than those disclosed in the value added tax return, exempt and zero-rated supplies included.
• Where there is no such registration, sales are estimated on the annual average of active employees recorded at the social insurance organisation, multiplied by 6,000 riyals.
• The zakat charged this way is never less than 500 riyals.
• Moving to an accounts basis is an application made before the zakat year ends, answered within thirty days, and the way back needs approval and reasons.

The two calendars

Registration comes before the first fiscal year closes, and the declaration goes in within 120 days of the year end. Value added tax runs on its own period: three months as standard, monthly only where taxable supplies exceeded 40,000,000 riyals over the previous twelve months, each payment due by the last day of the month after the period. The authority may revise an assessment for five years, and correct arithmetic for ten.

Sources: Arabic, the thirty-day answer, the formula, the minimum and the arbitrary basis — the Implementing Regulations for Zakat Collection; books in the Kingdom and the ten years — the zakat documents guideline; the auditor exemption — the Ministry of Commerce.