30-year tax break to MNCs relocating HQ to Riyadh

Saudi Arabia has announced a 30-year tax break for multinational companies if they relocate their regional headquarters to Riyadh.

The program encourages international companies to set up their regional headquarters in Saudi Arabia, making it their first choice in the Middle East and North Africa region. The program offers various benefits and support services to attract these companies.

Corporate Tax in Saudi Arabia

As per Saudi Tax Law, companies owned by non-Saudis and non-GCC citizens are required to pay 20% corporate income tax on their profits.

In addition, they must pay a 5% to 20% withholding tax on the payments made to non-resident Saudis, including the repatriation of dividends.

However, a company owned by Saudis or GCC residents must pay only 2.5% Zakat on the Zakat base.

Tax package to MNCs

The package given to multinational companies to move their regional headquarters to Riyadh includes many benefits, such as;

• 0% corporate income tax for 30 years.
• 0% withholding tax on selected services for 30 years.
• 0% Saudization requirements.

Companies can benefit from tax exemption starting from issuing their regional headquarters license.

Corporate Tax in the UAE

The corporate tax rates in the UAE are;

• 0% for taxable income up to AED 375,000.
• 9% for taxable income above AED 375,000.

Source: Al Arabiya