Dear Our Valued Customer,
Greetings,
Following the announcement on 11 May 2020 that Saudi Arabia would increase the standard rate of value-added tax (VAT) from 5% to 15%, the General Authority for Zakat and Tax (GAZT) has announced transitional rules governing supplies taking place around, or spanning, the rate change.
Supplies made under contracts signed before 11 May 2020, by registered taxpayers to government departments or tax-registered recipients entitled to full recovery of VAT charged on the supply, will continue to be subject to 5% VAT until the earlier of: renewal of the contract, expiry of the contract, or 30 June 2021.
For contracts signed on or after 11 May 2020, if the supply is made or completed before 30 June 2020, it will be subject to 5% VAT. Otherwise, if the supply is made from 1 July 2020 onwards, the increased standard rate of 15% will apply.
Supplies of a continuous nature, contracted before 11 May 2020, will continue to be subject to 5% VAT, to the extent they are delivered up to 30 June 2021. Where such supplies are agreed on or after 11 May 2020, 5% VAT will apply to the extent the services are delivered up to 30 June 2020, and 15% thereafter.
As ASLAK & its subsidiaries’ valued customer, your readiness to comply with these new regulations will be critical to ensure the successful implementation.
Kind Regards,
VAT Implementation Team
United Wire Factories Company
Dear Our Valued Vendor,
Greetings,
Following the announcement on 11 May 2020 that Saudi Arabia would increase the standard rate of value-added tax (VAT) from 5% to 15%, the General Authority for Zakat and Tax (GAZT) has announced transitional rules governing supplies taking place around, or spanning, the rate change.
Supplies made under contracts signed before 11 May 2020, by registered taxpayers to government departments or tax-registered recipients entitled to full recovery of VAT charged on the supply, will continue to be subject to 5% VAT until the earlier of: renewal of the contract, expiry of the contract, or 30 June 2021.
For contracts signed on or after 11 May 2020, if the supply is made or completed before 30 June 2020, it will be subject to 5% VAT. Otherwise, if the supply is made from 1 July 2020 onwards, the increased standard rate of 15% will apply.
Supplies of a continuous nature, contracted before 11 May 2020, will continue to be subject to 5% VAT, to the extent they are delivered up to 30 June 2021. Where such supplies are agreed on or after 11 May 2020, 5% VAT will apply to the extent the services are delivered up to 30 June 2020, and 15% thereafter.
As ASLAK & its subsidiaries’ valued vendor, your readiness to comply with these new regulations will be critical to ensure the successful implementation.
Kind Regards,
VAT Implementation Team
United Wire Factories Company
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