Two or more Saudi-based companies can apply for a group value-added tax (VAT) account, the General Authority of Zakat and Tax (GAZT) said in a statement today.
This option is especially beneficial for large firms and their subsidiaries, as it simplifies the tax declaration procedures.
Under the VAT regulations, a company can apply for a group tax account if it owns 50 percent of capital or has a 50 percent vote or ownership in the other firms, the statement said.
Such an option will be viable if at least one of the companies is taxable, and the group’s annual taxable supplies surpass the required minimum amount.
After obtaining GAZT’s approval, the group of companies will get a unified account number, where their old VAT accounts will be suspended, but not cancelled.
The main applicant will represent the group and will be liable on behalf of both the group and every company in it concerning all VAT-related issues, including the tax amounts due, the statement added.
The Kingdom will start levying the VAT on Jan. 1, 2018.
The GAZT has called on companies with annual revenues exceeding SAR 1,000,000 to register for VAT before Dec. 20 2017, in order to avoid facing fines and the suspension of many government services.
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