GTL Summary:

Article 22 establishes the State's fiscal year as the default taxable year. However, it permits a taxpayer to adopt an alternative 12-month period, subject to conditions specified in the Regulations. The Article provides for the creation of a 'short independent fiscal period' to account for the interval when a taxpayer changes their taxable year. It also clarifies that the first year of a new taxpayer, or the final year for a business discontinuing operations, may be treated as a short fiscal year, unless the Companies Law mandates a long one. Critically, it mandates that all related companies, as defined in Article 64, must use the same taxable year.

Document Type: Tax Law Article
Law: Income Tax Law (Royal Decree No M/1 - 21 Feb 2004)
Article Number: 22
Country: 🇸🇦 KSA
Location: Chapter 6 - Tax Accounting Rules
Order: 22
Last updated at: 2025-12-19 09:23:03 UTC

Chapter 6 - Tax Accounting Rules

Article 22 - Taxable year

The taxable year shall be the State's fiscal year.
A taxpayer may use a 12-month period other than the one specified in paragraph (a) of this Article as a taxable year, in accordance with the restrictions specified in the Regulations.
If a taxpayer changes its taxable year, the interval between the last full taxable year prior to the change and the starting date of the new taxable year shall be considered a short independent fiscal period. The first year of a new taxpayer or the last year of a taxpayer in case of discontinuation or liquidation may be a short independent fiscal year, unless the Companies Law stipulates for it to be a long fiscal year.
Groups of related companies, as defined in Article 64 of this Law, shall use the same taxable year.

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