In light of the economic developments taking place in the Kingdom of Saudi Arabia, the tax number has become an essential tool for regulating financial transactions between individuals, businesses, and government agencies. There are several ways to inquire about it. Whether you’re a business owner or a consumer, knowing how to inquire about your tax number using the registration number is a necessary step to ensure transparency and compliance with regulations.
In this article, we’ll review everything you need to know about the tax number, its benefits, and how to inquire about it using your commercial registration number, in addition to your tax obligations and potential penalties to avoid.
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?What is the tax number
Investing in Saudi Arabia has become one of the obvious goals for many entrepreneurs، Establishing companies in Saudi Arabia has clear steps to ensure legal compliance with regulations and laws, one of the most important of which is obtaining a tax number. Tax number (Tax Identification NumbeR – (Tax Identification Number-TIN) is a unique 15-digit code issued by the General Authority for Zakat, tax and Customs (ZATCA) to identify taxable entities and individuals. This figure is divided into four parts:
- The first three digits: indicate the type of taxpayer (individual or company) and the sector of activity.
- The following eight digits: serial number of the facility or individual.
- The following two digits: branch or unit code.
- The last two digits: a verification number to ensure the correctness of the number .
?What is the difference between a premium number and a tax number
In Saudi Arabia, there is a difference between the Unified Number and the Tax Number.
Premium Number: A 10-digit number that serves as a reference for the entity with the Zakat, Tax and Customs Authority (ZATCA). It is generally used to identify the entity with the authority.
Tax Number: A 15-digit number that an entity receives after registering for Value Added Tax (VAT) or Excise Tax. The tax number must appear on all invoices issued by the entity and on the tax certificate.
How to Obtain a Tax Number for a Business?
Registering for a tax number requires following a few simple but precise steps:
Visit the website of the Zakat, Tax and Customs Authority and register as a new user.
Fill out the registration form with company details, including contact information and the bank account to be used for tax transactions.
Note: Registration may require certain documents, such as the commercial registration certificate, articles of association, and a tax declaration. Make sure to verify the requirements before proceeding.
What Are the Benefits of a Tax Number for Individuals?
A tax number is used to identify individuals for tax purposes based on the type and nature of taxes applicable to them.
Simplified tax procedures: Such as submitting tax returns or paying due taxes.
Proof of tax identity: When dealing with government entities or banks.
Eligibility for incentives: Like tax exemptions in certain sectors.
What Are the Benefits of a Tax Number for Businesses?
A tax number is the primary identification tool for businesses with ZATCA and is used for various purposes:
Legitimacy in transactions: Confirms that the business is registered in the tax system, increasing customer trust.
Issuing e-invoices: A mandatory requirement for issuing tax-compliant invoices under new invoicing regulations.
Avoiding penalties: Such as fines or business suspension for non-compliance.
Ensuring legal compliance: Filing tax returns reflects the business’s compliance with local laws and transparently declares profits and government dues.
How to Check the Tax Number Using a Commercial Registration Number?
ZATCA offers a simple online service to verify the tax number using the commercial registration (CR) number by following these steps:
Visit the official website: [zatca.gov.sa].
Navigate to “E-Services” → “Tax Services.”
Choose “VAT Registration Verification.”
Select “Search Type” → “Commercial Registration.”
Enter the CR number and the verification code.
Click “Submit” to view the results, which include the business name and tax number.
How to Cancel a Tax Number?
In certain cases, individuals or businesses may need to cancel their tax number, such as when:
The business ceases operations.
The business activity changes, altering the applicable tax treatment.
To cancel the tax number, follow these steps:
Log into your account on the ZATCA website.
Go to the de-registration page and choose “Request to Cancel Registration.”
Fill in the required details, upload supporting documents, and confirm the cancellation.
Important Note: Businesses must request tax number cancellation if they stop using it for a long period. ZATCA also reserves the right to cancel the tax number for non-compliance with tax procedures.
Which Goods Are Exempt from VAT?
ZATCA has specified certain goods that are exempt from VAT, including:
All medical supplies announced by the Saudi Food and Drug Authority (SFDA).
Investment-grade gold, silver, or other precious metals (purity not less than 99%) are exempt when traded for investment.
Financial services such as opening a bank account.
International transportation of passengers and goods.
Certain residential real estate transactions (not commercial), such as gifts, inheritance, mortgage, or transferring the property to a government entity.
What Are the Penalties for Not Complying with Tax Obligations?
Although many changes in Saudi labor and tax laws aim to benefit investors, tax evasion or manipulation is met with strict penalties from ZATCA. These include:
Tax Evasion: Punishable by a fine of no less than the due tax amount and no more than three times the value of the goods or services in question.
Falsifying data: Anyone submitting incorrect tax returns, modifying previously submitted returns, or submitting misleading documents that result in underpaying taxes will be fined 50% of the difference between the calculated and actual tax due.
Delaying tax payment: A 5% penalty on the unpaid tax amount if not paid within the deadline.
General violations (subject to fines up to SAR 50,000) for:
Failure to keep invoices, records, or documents as per regulations (per tax period).
Obstructing or preventing ZATCA officials from performing their duties.
What Are the Tax Obligations of Entrepreneurs?
To ensure your business remains compliant and avoids legal issues, as an investor you must:
Register in the tax system: If business revenue exceeds the required threshold.
Issue tax invoices: Including the tax number of both the business and the buyer.
Submit periodic tax returns: Monthly or quarterly based on activity size.
Maintain financial records: For at least 5 years.
Types of Taxes in Saudi Arabia
There are several types of taxes imposed on individuals and companies in Saudi Arabia, including:
1. Value Added Tax (VAT)
Rate: 15% on most goods and services.
Exemptions: Some goods/services are zero-rated or exempt, such as healthcare, education, and certain residential real estate.
2. Real Estate Transaction Tax
Rate: 5% on the property’s value upon sale or transfer.
Exemptions: Gifts to first-degree relatives, inheritance, and certain other scenarios.
3. Corporate Taxes
Income Tax: 20% on profits of foreign companies operating in the Kingdom.
Zakat: 2.5% on net assets of Saudi and GCC companies.
Withholding Tax: Ranges from 5% to 20% on payments transferred to entities outside the Kingdom.
الخاتمة
The tax number is not just a digital code—it’s a secure gateway for communication and compliance between businesses and authorities. Understanding how to verify it and fulfill your tax obligations protects you from legal risks and enhances the credibility of your business. Remember, financial transparency isn’t only a legal requirement—it’s an investment in the future and reputation of your enterprise.
Global business way – Your Ideal Partner for Commercial Registration
Obtaining a commercial registration is a key step in establishing your company in Saudi Arabia. To ensure legal compliance with local regulations, you can rely on Global business way’s experts for:
Registering your business,
Renewing or modifying your commercial registration,
Canceling the registration,
Checking your tax number using the commercial registration number.
Get in touch with our experts for a free consultation via email at info@taabusiness.com or by phone at +966568849250.
