GTL Summary:

This Resolution constitutes the Executive Bylaws for the KSA Income Tax Law, issued by Royal Decree No. M/1. Article 18 specifies the rules governing the taxable year. It establishes the state's fiscal year as the default tax period for all taxpayers, commencing from the date of commercial registration. The Article details permissible exceptions, allowing taxpayers to adopt a different fiscal year if they are part of a corporate group or were previously approved. It outlines specific compliance procedures for short and long fiscal years, including filing separate returns and adhering to payment deadlines, without prejudice to advance payment provisions.

Document Type: ERS - Executive Regulations
Law: Income Tax Law (Royal Decree No M/1 - 21 Feb 2004)
Decision Number: executive-regulations-1535-article-18
Year: 2019
Country: 🇸🇦 KSA
Official Name: Article 18 - Taxable Year
Last updated at: 2026-01-05 08:39:39 UTC

Article 18 - Taxable Year

  1. The tax year of a taxpayer for all its activities is the fiscal year of the state. A taxpayer's fiscal begins from the date it obtains its commercial registration or license, unless evidence proves otherwise. It is permissible to use a different tax year in the following cases:

    • If the taxpayer is already using a different fiscal year approved by the Authority prior to the Income Tax law taking effect;

    • If the taxpayer is using a Gregorian fiscal year;

    • When the taxpayer is a member of a group of companies or a branch of a foreign company using a different fiscal year. When using a different fiscal year, the following should be met:

      1. The Taxpayer must submit a separate tax return for the short period between the end of the previous tax year and the start of the new tax year, and pay tax according to the return within the legally prescribed time.

      2. The first year for a new taxpayer or the last year in case of cessation or liquidation may be a short fiscal year, unless the company's articles of association require a long fiscal year.

      3. The application of the above provisions is without prejudice to the provisions of Article 70 of the Income Tax Law regarding advance payment of tax by a taxpayer who changes its fiscal year.

  2. A taxpayer whose first year is a long fiscal year, in accordance with the company's articles of association, shall file a tax return for the first 12 months within 120 days of the end of the first 12 months. After the end of the long fiscal period, the taxpayer shall file one consolidated return for the long fiscal period and pay tax accordingly with a credit of the amount paid for the first period.

  3. In case of a short fiscal period, shorter than 12 months, the due date for payment of tax and filing of return is within 120 days from the closure of accounts.

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