What is the current VAT rate in Saudi Arabia?

Saudi Arabia applies a standard VAT rate of 15% on most goods and services. The rate was introduced at 5% on 1 January 2018 and raised to 15% on 1 July 2020 by Royal Decree to support government finances during the COVID-19 pandemic. The 15% rate has remained in effect since then.

How do I add 15% VAT to a price in Saudi Arabia?

To add VAT, multiply the net amount by 0.15 and add the result to the original. For example, a net price of 1,000 SAR gives a VAT amount of 150 SAR and a gross total of 1,150 SAR. The formula is: gross = net x 1.15.

How do I remove VAT from a VAT-inclusive price?

To extract VAT from a gross price, divide the gross by 1.15. For example, a gross price of 1,150 SAR divided by 1.15 gives a net of 1,000 SAR. The VAT element is 1,150 minus 1,000 = 150 SAR. The formula is: net = gross / 1.15.

What goods and services are zero-rated for VAT in Saudi Arabia?

Zero-rated supplies (0% VAT) in Saudi Arabia include exports of goods and services outside the Kingdom, international passenger and freight transport, medicines and qualifying medical equipment, and supplies made within designated special economic zones. Zero-rated is different from exempt — a zero-rated supplier can still recover input VAT.

What is exempt from VAT in Saudi Arabia?

Exempt supplies include the resale of residential real estate, bare land transactions, life insurance premiums, and certain financial services that do not carry an explicit fee (such as interest on conventional loans). Suppliers of exempt goods and services cannot register for VAT or recover input tax.

Who must register for VAT in Saudi Arabia?

Businesses with taxable supplies or imports exceeding SAR 375,000 per year must register for VAT with the Zakat, Tax and Customs Authority (ZATCA). Voluntary registration is available for businesses above SAR 187,500. Non-resident businesses making taxable supplies in Saudi Arabia must also register regardless of turnover.

Saudi Arabia VAT Calculator

Saudi Arabia operates a Value Added Tax (VAT) system administered by the Zakat, Tax and Customs Authority (ZATCA). The standard rate is 15%, and it applies to the overwhelming majority of commercial transactions — including retail, hospitality, professional services, construction, telecoms and digital services. This calculator handles both directions: adding VAT to a net price to produce the customer’s gross total, or stripping VAT out of an already-inclusive price to find the underlying net figure.

How VAT works in Saudi Arabia

VAT is a consumption tax collected at each stage of the supply chain. Registered businesses charge VAT on their sales (output tax), reclaim VAT on their purchases (input tax) and remit only the difference to ZATCA. The end consumer bears the full 15% because they cannot reclaim it.

Two modes of calculation:

Add VAT (exclusive): your quoted price does not include tax. Multiply by 1.15 to reach the customer’s payable total.
Remove VAT (inclusive): a price already includes tax. Divide by 1.15 to isolate the net base; the difference is the embedded VAT.

The tool supports both the standard 15% rate and the zero rate (0%) that applies to qualifying exports and medical supplies, letting you confirm that a zero-rated transaction correctly results in no VAT charge.

Worked example

A Saudi software consultancy issues an invoice for SAR 5,000 net.

Line	Amount (SAR)
Net amount (excl. VAT)	5,000.00
VAT at 15%	750.00
Gross total (incl. VAT)	5,750.00

Now suppose the consultancy receives a supplier invoice showing a VAT-inclusive total of SAR 2,300. To find out how much VAT it can reclaim:

Line	Amount (SAR)
Gross (incl. VAT)	2,300.00
Net (excl. VAT) = 2,300 / 1.15	2,000.00
VAT reclaimable	300.00

Both calculations are handled instantly by switching the mode toggle above.

Saudi Arabia VAT rate summary

Rate	Category	Typical examples
15%	Standard rate	Electronics, clothing, food and drinks (non-basic), hotels, restaurants, professional services, construction, telecoms
0%	Zero rate	Exports outside KSA, international transport, qualifying medicines and medical devices, supplies within special economic zones
Exempt	Exempt supplies	Residential property resale, bare land, life insurance, certain financial services without explicit fee

VAT registration thresholds

Businesses with annual taxable turnover above SAR 375,000 are required to register. Voluntary registration is possible from SAR 187,500. Non-resident businesses supplying taxable goods or services in Saudi Arabia must register regardless of revenue level. ZATCA issues a Tax Identification Number (TIN) on registration, which must appear on all VAT invoices.

E-invoicing (Fatoorah)

Saudi Arabia mandates electronic invoicing through the Fatoorah (فاتورة) programme. Phase 1 (generation) required all VAT-registered businesses to issue structured digital invoices from December 2021. Phase 2 (integration) is rolling out from January 2023, requiring direct integration with ZATCA’s systems for real-time invoice clearance. Compliant invoices must include the supplier’s TIN, the buyer’s details, the VAT amount, the QR code and other mandatory fields defined by ZATCA.

All figures produced by this calculator are for guidance only and do not constitute tax advice. Verify current rates and thresholds with ZATCA (zatca.gov.sa) or a qualified Saudi tax adviser.