1Issue 3.0 | May 2026

4.2 Voluntary Registration Any resident person who is not required to register mandatorily, but whose taxable supplies or taxable expenses exceed the Voluntary Registration Threshold of SAR 187,500 during a 12-month period, may register voluntarily for VAT (8). Voluntary registration is recommended where a company wishes to claim a refund of VAT paid on its costs. Example (1) Al-Nada Company Limited purchased a commercial building in Riyadh with the intention of renovating and renting it as office space to other companies. During 2021, the company incurred substantial costs of over SAR 2,000,000 to renovate the building, prior to tenants occupying the premises in 2022, and started to make taxable supplies in respect of office lease agreements. In this case, Al-Nada Company may register for VAT during 2021 on a voluntary basis, given that its annual Taxable Expenses exceed SAR 187,500. 4.3 Deregistration A taxable person must apply for deregistration in the following cases (9). Ceasing to Carry on an Economic Activity Ceasing Ceasing to make taxable supplies If the taxable person fails to make any taxable supplies during the preceding 12 months. If the value of taxable supplies is below the Voluntary Registration Threshold. Where the value of supplies or expenses has not exceeded SAR 187,500 during the preceding 12 months, has not exceeded SAR 375,000 during the preceding 24 months, and is not expected to exceed SAR 187,500 during the following 12 months. (8) Article 7, Implementing Regulations of VAT Law. (9) Article 13, Implementing Regulations of VAT Law. • A person must apply for deregistration within 30 days of the occurrence of any of the cases mentioned above. • Any person who is not required to deregister under any of the cases mentioned above, but whose annual taxable revenues do not exceed the mandatory registration threshold of SAR 375,000, and whose annual supplies to the Kingdom in that month and the following eleven months were not expected to exceed the mandatory registration threshold, may also choose to deregister may also opt for deregistration. • In all cases, deregistration shall take effect on the date determined by ZATCA following its approval of the deregistration. 5. Real Estate Disposal 5.1 What is Real Estate Disposal? • As of 4th October 2020, real estate disposals are exempt from VAT: “Supply of real estate, whether residential, commercial, agricultural, or vacant land (developed or undeveloped), by way of transfer of ownership or disposal thereof as owner, is exempt from tax. (10)” According to the RETT Law, real estate disposal is defined as a disposition that transfers ownership of real estate or transfers its usufruct permanently, whether directly or indirectly, or transfers its usufruct for a period exceeding 50 years. 5.2 Date of Supply The date of supply of real estate for VAT purposes is the date on which the real estate is placed at the disposal of the Customer. In practice, this date precedes: a. The date on which ownership of the real estate is transferred (recorded as the date of notarizing the transfer of ownership, or the contract date, if the transfer is not notarized); or b. The date on which possession of the real estate is given to the customer, if earlier, under a contract providing for the transfer of ownership to that customer (11). (10) Article 30 (1), Implementing Regulations of VAT Law (as updated pursuant to the decision of the Authority’s board of direc­ tors (1-5-20) (11) Article 20, Implementing Regulations of VAT Law.