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Zayenha Finance

AI assistant for accountants and financial consultants in Saudi Arabia

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A specialized AI assistant for Saudi tax accounting and financial compliance: Zakat calculation (2.5% of the base, prorated over the Hijri year) and corporate income tax for non-Saudi shareholders; 15% VAT and its registration thresholds; unified annual Zakat/CIT return filing within the 120-day deadline; e-invoicing (Fatoora) policy drafting across both phases; Real Estate Transaction Tax calculations; and financial statement review under SOCPA/IFRS standards — backed by a knowledge base of ZATCA regulations and compliance deadlines.

Example tasks it handles

Knowledge base reference

Reference material the assistant draws on. We review the content periodically and keep it accurate, but official sources remain the authority.

Best Practices

Zakat Base Calculation & Hijri-Year Proration
Zakat is calculated at 2.5% of the "Zakat base" (net Zakatable funds after adjusting equity and net profit per the Implementing Regulations); most companies use the "Equity and Adjusted Net Profit Method" as the calculation basis. The 2.5% rate is set against a 354-day Hijri year; if a company uses a Gregorian fiscal year or a longer/shorter period, the rate is prorated as (2.5% ÷ 354) × actual number of days. Example: an entity with a 365-day fiscal period and a SAR 2,000,000 Zakat base: Zakat = (2.5% ÷ 354) × 365 × 2,000,000 ≈ SAR 51,554. ZATCA consolidated previously scattered collection rules (Ministerial Resolution No. 1007, 29 February 2024) into one 128-article regulation, effective for financial years from 1 January 2024.

Glossary

Zakat (Term)
One of the five pillars of Islam; a religious financial obligation of 2.5% of the "Zakat base" (net Zakatable wealth once it reaches the Nisab threshold and a full Hijri year — Hawl — has elapsed). In the Saudi corporate context, it is levied on Saudi/GCC shareholders' portion of a company and collected by ZATCA in place of corporate income tax for that specific portion — unlike non-Saudi/GCC shareholders' portion, which is subject to 20% corporate income tax instead.

Regulations & Laws

Mandatory SOCPA-Endorsed IFRS Adoption for Listed Companies Since 2017
SOCPA (Saudi Organization for Chartered and Professional Accountants) mandated that listed companies apply "SOCPA-endorsed" IFRS — IFRS Accounting Standards as issued by the IASB, plus additional SOCPA disclosures ensuring Shariah compliance — for financial periods beginning 1 January 2017, with unlisted companies following from 2018. This required listed companies to prepare interim IFRS financial statements from Q1 2016 to establish comparative figures — a key reference point when reviewing any Saudi entity's accounting-transition history.
Dual Base: 20% Corporate Income Tax vs. 2.5% Zakat
A 20% corporate income tax applies to non-Saudi, non-GCC shareholders' proportionate share of income from activity within the Kingdom, while Saudi and GCC shareholders' share of the same activity is instead subject to Zakat at 2.5% of the Zakat base. For mixed ownership, income is split proportionately: e.g., a company 60% Saudi-owned and 40% foreign-owned subjects 60% of its income to Zakat (2.5%) and 40% to corporate income tax (20%). ZATCA is the single authority responsible for assessing and collecting both. (Note: oil/hydrocarbon production income is subject to separate higher rates of 50%-85%, outside this summary's scope.)
Mandatory & Voluntary VAT Registration Thresholds
Any business whose taxable supplies exceed SAR 375,000 over 12 months must register for VAT within 30 days of crossing the threshold (the final Implementing Regulations raised this from 20 days in the original draft to 30). Voluntary registration is available for businesses with taxable supplies between SAR 187,500 and 375,000, enabling input VAT recovery and early compliance readiness. Non-resident businesses making taxable supplies in the Kingdom have no minimum threshold at all — registration is required within 30 days of the first taxable supply.
Real Estate Transaction Tax (RETT) at 5%
RETT is levied at 5% on the transfer of real estate ownership via sale, gift, exchange, lease-to-own, Murabaha, or assignment, calculated on the agreed price (which cannot be lower than fair market value at transfer). The current law was issued by Royal Decree No. م/84 dated 19/03/1446H, effective 10 April 2025, replacing the 2020 regulations. The seller is responsible for payment before/during transfer; ZATCA oversees registration, reporting, and audit, with specific exemptions defined in the Implementing Regulations (e.g., waqf, inheritance).
VAT Rate at 15%
Saudi Arabia raised the VAT rate from 5% to 15% effective 1 July 2020 under Royal Decree A/638, building on the original VAT Law issued by Royal Decree A/152 (1438H/2017). The current rate applies to most domestic and imported goods/services unless zero-rated (e.g., exports, some financial/health/education services) or exempt. Practical example: a SAR 10,000 pre-tax invoice becomes SAR 11,500 VAT-inclusive (10,000 × 1.15). ZATCA (Zakat, Tax and Customs Authority) is the single authority responsible for administration, collection, and audit.
E-Invoicing Integration Waves 23 & 24 (2026)
The Integration Phase (Phase 2) of the Fatoora e-invoicing system rolls out in successive waves based on VATable revenue. ZATCA set Wave 23 for taxpayers exceeding SAR 750,000 in VATable revenue during 2022, 2023, or 2024, with an integration deadline of 31 March 2026; Wave 24 covers those exceeding SAR 375,000 in the same years, with a deadline of 30 June 2026. Phase 2 requires connecting invoicing systems directly to Fatoora via a secure API, transmitting invoices in real time — an invoice carries no legal standing until it passes ZATCA validation.

Ready Templates

Unified Annual Zakat/CIT Return Template — 120-Day Deadline
Under Article 102 of the Zakat Collection Implementing Regulations and Article 60 of the CIT Law, a taxpayer must file the return (Zakat and/or CIT depending on ownership structure) and pay amounts due within 120 days of the Zakat/tax year end. For a fiscal year ending 31 December 2025, the filing deadline is 30 April 2026. The return package typically includes: financial statements (SOCPA/IFRS-based for listed entities), a Zakat base reconciliation using the Equity and Adjusted Net Profit Method, and supporting schedules allocating income between the Zakat and tax bases for mixed ownership.
ZATCA's Mandatory Simplified Tax Invoice Template (Fields + QR Code)
A simplified tax invoice must at minimum include: the seller's legal name, 15-digit VAT registration number, invoice issue date, description of goods/services, VAT-inclusive total, and VAT amount. It must also carry a mandatory TLV-encoded QR code: the Generation phase requires 5 fields (seller name, VAT number, timestamp, total, VAT amount); the Integration Phase adds cryptographic tags (SHA-256 invoice hash, ECDSA digital signature, public key, certificate stamp), bringing the total to 9 mandatory TLV tags. The QR must be Model 2 with error-correction level "M" (15%).

Ready prompts in this field

Human-vetted, ready-to-use prompts.

Zakat Calculator

Calculate Zakat accurately per ZATCA guidelines covering Nisab, Hawl, and both individual and corporate scenarios

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Comprehensive Zakat Calculation (Personal & Business)

Full Zakat calculation guide: cash, livestock, crops, gold, stocks, funds, companies — applying ZATCA regulations for Saudi entities.

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VAT Calculation & E-Invoicing Requirements – ZATCA Phase 2 (15%)

Calculate Saudi VAT at 15% and verify e-invoice data completeness per ZATCA Phase 2 requirements, including QR code and XML fields.

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3-Statement Financial Model — IFRS/SOCPA

Build an integrated 3-statement financial model linking income statement, balance sheet, and cash flows under IFRS/SOCPA standards.

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Annual Budget

Build a full annual budget for a Saudi company following SOCPA standards, with departmental allocation, variance analysis, and ZATCA complia…

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Cash Flow Projection

Prepare a cash flow statement and 12-month projection for Saudi SMEs under IFRS 7, covering both direct and indirect methods with local cont…

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Financial KPIs

Analyze financial ratios for liquidity, profitability, and solvency per IFRS and SOCPA standards for Saudi companies

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Discounted Cash Flow (DCF) Company Valuation

Professional DCF valuation for a Saudi company with WACC, FCFF, Terminal Value, and sensitivity analysis for M&A or Tadawul IPO.

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Comparable Companies Multiples Valuation

Valuation via Trading Multiples (EV/EBITDA, EV/Revenue, P/E) with peer selection from Tadawul and MENA markets.

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Company Valuation

Value a Saudi startup using DCF and revenue multiples, calibrated to SAMA regulations, Tadawul comps, and STV/Wa'ed fund benchmarks.

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Cost Reduction

Cost reduction strategy using Zero-Based Budgeting for Saudi companies — protecting quality, workforce, and compliance with labor regulation…

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Capitalization Table for a Saudi Startup

Multi-class cap table (Founders + ESOP + SAFE + Preferred) for a Saudi startup, with dilution simulation across rounds.

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Note: The content above is informational and intended for professional reference. It is not formal legal, tax, or professional advice. Please consult official sources and specialists before taking any action.