GTL Summary:

Article 25 mandates that taxpayers using the accrual method for tax accounting must record income and expenses at the time they become due, rather than when cash is exchanged. The text clarifies the timing of recognition for both. Income is considered due and must be recorded when the taxpayer establishes the right to receive it, regardless of whether the payment is postponed or will be paid in instalments. Similarly, an expense is considered due and payable by the taxpayer once all the necessary facts that determine the liability have occurred, establishing a definitive obligation.

Document Type: Tax Law Article
Law: Income Tax Law (Royal Decree No M/1 - 21 Feb 2004)
Article Number: 25
Country: 🇸🇦 KSA
Location: Chapter 6 - Tax Accounting Rules
Order: 25
Last updated at: 2025-12-19 09:23:03 UTC

Chapter 6 - Tax Accounting Rules

Article 25 - Accrual-Basis Accounting

A taxpayer who uses the accrual method shall record income and expenses when they are due.
An amount becomes payable to the taxpayer when the taxpayer is entitled to receive it, even if payment is postponed or paid in installments.
An amount becomes payable by the taxpayer when all facts determining liability have occurred.

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