Saudi Corporate Tax & Zakat Calculator 2026
20% income tax on the non-Saudi share of profit and 2.5% / 2.578% zakat on the Saudi or GCC share of the zakat base, withholding tax on dividends, royalties and management fees, and the effective rate for a mixed-ownership company.
| Profit attributable to non-Saudi share | — |
|---|---|
| Income tax at 20% | — |
| Profit attributable to Saudi / GCC share | — |
| Zakat | — |
| Effective rate on total profit | — |
| Withholding tax on payments abroad | — |
| Net profit after tax & zakat | — |
| Filing & payment | — |
In short
Saudi companies pay 20% income tax on the share of adjusted profit owned by non-Saudi/non-GCC persons and 2.5% zakat (2.578% for a Gregorian year) on the Saudi/GCC share of the zakat base, never less than 2.5% of profit. A 60% Saudi-owned company with SAR 2 million profit and a SAR 4 million zakat base pays about SAR 222,000 — an effective 11%; withholding tax is 5% on dividends, 15% on royalties and 20% on management fees.
Who this is for: Founders, finance managers and foreign investors estimating income tax and zakat for a Saudi company, LLC or branch with mixed ownership.
Income tax vs zakat: how a Saudi company is taxed
Saudi Arabia runs two systems side by side. The share of a company owned by non-Saudi and non-GCC persons pays corporate income tax at 20% of adjusted net profit; the share owned by Saudi and GCC nationals pays zakat at 2.5% of the zakat base — broadly the equity funding the business (capital, reserves, retained earnings and long-term loans) less fixed assets and other deductions, but never less than 2.5% of adjusted profit. A 60/40 company therefore pays zakat on 60% and income tax on 40%.
- Gregorian year: because zakat is a lunar-year levy, ZATCA applies 2.578% to a 365-day financial year (2.5% × 365 ÷ 354).
- Withholding tax on payments to non-residents: 5% on dividends, interest and technical services, 15% on royalties, 20% on management fees — reduced under Saudi Arabia's tax treaties.
- Other rates: oil and hydrocarbon producers 50–85%; qualifying regional headquarters 0% on RHQ income for 30 years; special economic zones have their own incentives.
- Compliance: file and pay within 120 days of year end; advance payments if last year's tax exceeded SAR 500,000; transfer-pricing documentation applies to both tax and zakat payers above the thresholds.
See also: Saudi VAT Calculator (15%), ZATCA QR Code Generator & Decoder, Saudi GOSI Calculator.
Assumptions
- Income tax = 20% × profit × non-Saudi %; zakat = rate × max(Saudi % × zakat base, Saudi % × profit), rate 2.5% (Hijri year) or 2.578% (Gregorian).
- Withholding = 5% dividends + 20% management fees + 15% royalties on the amounts entered.
- Loss carry-forward, treaty relief, RHQ/SEZ incentives and detailed zakat-base adjustments are not modelled.
Worked example
Foreign share 40% × 2,000,000 = SAR 800,000 → income tax 20% = SAR 160,000. Saudi share 60%: zakat base 60% × 4,000,000 = SAR 2,400,000 (higher than the SAR 1,200,000 profit share) × 2.578% = SAR 61,872. Total SAR 221,872 — an effective 11.1% of profit. A fully foreign-owned company would pay SAR 400,000 (20%); a fully Saudi-owned one SAR 103,120 of zakat.
Frequently asked questions
What is the corporate tax rate in Saudi Arabia?
20% of adjusted net profit for the share of a company owned by non-Saudi, non-GCC persons; Saudi and GCC-owned shares pay 2.5% zakat instead. Oil and gas producers pay 50–85%.
Do Saudi-owned companies pay corporate tax?
No — companies wholly owned by Saudi or GCC nationals pay zakat (2.5% of the zakat base, at least 2.5% of adjusted profit), not income tax.
How is zakat calculated for a company?
2.5% (2.578% for a Gregorian year) of the zakat base: share capital, retained earnings, reserves, provisions and loans outstanding over a year, less non-current assets and other deductions — with a floor of 2.5% of adjusted net profit.
What is the withholding tax in Saudi Arabia?
5% on dividends, interest, rent and technical services paid to non-residents, 15% on royalties, 20% on management fees; treaties can reduce these. The payer withholds and remits to ZATCA by the 10th of the following month.
Is there corporate tax on free-zone or RHQ companies?
Regional headquarters licensed under the RHQ programme get 0% income tax and withholding tax on qualifying income for 30 years; special economic zones offer 5% for 20 years in some zones.
When is the Saudi corporate tax return due?
Within 120 days of the financial year end, with payment; companies whose tax last year exceeded SAR 500,000 make three advance payments of 25% each in months 6, 9 and 12.
Do GCC nationals pay zakat or income tax in Saudi Arabia?
Zakat — GCC nationals and GCC-owned companies are treated like Saudis for this purpose, so their share pays 2.5% zakat rather than 20% income tax.
What is the tax rate for a branch of a foreign company?
20% income tax on the branch's adjusted profit, plus 5% withholding on profits remitted to the head office; a permanent establishment is taxed the same way.
People also ask
What is the corporate tax rate in Saudi Arabia?
20% on the non-Saudi-owned share of profit; the Saudi/GCC-owned share pays zakat at 2.5% of the zakat base instead.
Do Saudi-owned companies pay income tax?
No — they pay zakat (2.5% of the zakat base, often 2.578% for a Gregorian year); mixed companies apportion between tax and zakat.
Is there withholding tax in Saudi Arabia?
Yes — 5% on dividends and interest, 15% on royalties, 20% on management fees and 5% on technical services paid to non-residents.
When is the corporate tax return due?
Within 120 days of the financial year end, with payment by the same date.
Do foreign branches pay tax?
Yes at 20% on Saudi-source profit, plus a 5% withholding on remittances to the head office.
Are oil and gas companies taxed differently?
Yes — rates range from 50% to 85% depending on investment size under the oil and hydrocarbon regime.
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