1Issue 1 | September 2024

Application of the Collection of Zakat in the Kingdom of Saudi Arabia Collecting Zakat and distributing it to eligible recipients is one of the fundamental duties of the State, as stipulated in Article 21 of the Basic Law of Governance, which states: “Zakat shall be collected and spent in its legitimate channels.” Article 7 also reflects the State’s commitment to the obligations of Sharia and adherence to them in general, including the collection and distribution of Zakat, stating that “the government in the Kingdom of Saudi Arabia derives its power from the Qur’an and the Prophet’s tradition, which govern this Law and all State regulations.” To affirm this, during the reign of the founder King Abdulaziz (may Allah have mercy on him), Royal Decree No. (8634/28/2/17) dated 29th Jumada II 1370H/ 6th April 1951G was issued, ordering the collection of Zakat. This Decree was followed by numerous Royal Decrees confirming it, Ministerial Resolutions implementing it, and explanatory regulations and circulars, including: Royal Decree No. (M/40) dated 2nd Rajab 1405H/24th March 1985G; the Implementing Regulations for Zakat Collection issued by Ministerial Resolution No. (2082) dated 1st Jumada II 1438H/28th February 2017G; the Implementing Regulations for Zakat Collection issued by Ministerial Resolution No. (2216) dated 7th Rajab 1440H/14th March 2019; and the Implementing Regulations for Zakat Collection issued by Ministerial Resolution No. (1007) dated 19th Sha’ban 1445H/29th February 2024G, applicable to fiscal years beginning on or after 1st January 2024. The Implementing Regulations for Zakat Collection specifically address the rules for commercial activities (excluding other Zakatable assets), requirements for submitting Zakat returns, procedures for assessment, review, payment, and related timelines. The Zakat revenue collected by ZATCA is deposited into the Social Security account, which is responsible for disbursing funds to the poor and needy, in accordance with Royal Decree No. (1/5/16) dated 5th Muharram 1383H 28th May1963G. Paragraph 1 of this Decree states that “Zakat shall be collected in full from all joint stock companies and others, as well as individuals subject to Zakat.” Paragraph 2 stipulates that “all collected amounts shall be deposited into the Social Security Fund.”