The Saudi  Zakat, Tax, and Customs Authority (ZATCA) has published a VAT Guide, providing clarifications on amendments to the VAT Executive Regulations.

Key points include new conditions for tax group registration. To qualify, each member must be VAT-eligible, have a fixed business location in Saudi Arabia, and meet voluntary registration criteria. Additionally, at least 50% of the capital, voting rights, or market value of each group member must be controlled by the same legal person. Members cannot be licensed in special customs zones or be part of another tax group. They must also not be eligible for VAT refunds, with specific exceptions for certain property developers and public benefit project donors. These conditions must be met throughout the registration period, and existing tax groups with non-compliant members have six months to make adjustments.

The guide also details the treatment of transferring an economic activity. A transfer of business is not a taxable supply if it includes all tangible and intangible assets necessary for the activity, the recipient is VAT-registered, and both parties agree to treat it as such for VAT purposes. The ZATCA must be notified of the transfer within a month using a designated form. If the conditions aren’t met, the transfer is considered a taxable supply.

Additionally, the guide offers clarifications on electronic marketplaces. A platform enabling suppliers to list or offer goods/services is defined as an electronic marketplace for VAT purposes. However, platforms that only process payments or redirect customers without facilitating purchases are not subject to VAT. When an electronic marketplace intermediates services from a non-resident supplier, it assumes responsibility for VAT collection and remittance. From January 2026, marketplaces facilitating transactions for unregistered resident suppliers will also be deemed to have purchased and resupplied goods or services, making them liable for VAT.

Other updates include changes regarding the cessation of economic activity, the scope of service supplies, and VAT deductions on goods under financing contracts.