ZATCA published a user guide that explained how regional headquarters (RHQs) submit annual disclosure forms to demonstrate compliance with economic substance requirements.
Saudi Arabia’s Zakat, Tax and Customs Authority (ZATCA) has published a user guide on how regional headquarters (RHQs) must submit their annual disclosure form through the ZATCA website. The form is used to check compliance with the economic substance requirements under the Tax Rules for Regional Headquarters, provided under ZATCA Board Decision No. 9-1-24 of 4 February 2024.
Compliance with these requirements is relevant to the application of the 0% income tax and withholding tax rates available to qualifying RHQs.
To open the form, users must log in to the ZATCA portal with a taxpayer identification number, a registered email address or national single sign-on (Nafath). A verification code is then sent by text message. The form asks for details on contact persons, head office and branch locations, board members and meetings, executive management and employees, RHQ activities, and financial information for the disclosure year, including operating expenses and supporting documents.
Once the RHQ has reviewed the summary and declared the information correct, it confirms the submission. ZATCA then issues an acknowledgement of receipt, and the submitted form can be downloaded.
Earlier, Saudi Arabia modified its government procurement policy by introducing an exemption mechanism that allows government entities to contract with foreign companies without a regional headquarters (RHQ) in the Kingdom under specific circumstances.
