1Version 6 | May 2026

Real Estate Transaction in cases of expropriation of real estate ownership or temporary taking of property according to the laws or statutory instruments issued by relevant authorities, including returning the real estate to the original owner according to those laws or statutory instruments. This exemption applies to the real estate transaction resulting from the expropriation of real estate for public benefit according to the laws applicable in the Kingdom, and the owner of the real estate is exempt from paying the Real Estate Transaction Tax in this case. The exemption only applies if the expropriation of ownership is carried out according to the approved statutory procedures, whereas transactions that take place outside this framework are subject to Real Estate Transaction Tax. Example (25) A decision was issued regarding the expropriation of a real estate for public benefit for the purpose of constructing a road, provided that the owner is compensated with an amount of (800,000) SAR. The owner of that real estate is exempt from paying the Real Estate Transaction Tax before the real estate transfer or notarization process; as the transfer of ownership of the real estate was carried out forcibly for public benefit by virtue of an expropriation decision issued by a competent authority according to the laws applicable in the Kingdom. 5.1.7. Real Estate Transaction by way of a notarized gift to a spouse or a relative up to the third degree. A real estate transaction by way of a notarized gift is exempt from Real Estate Transaction Tax if the donor (assignor) presents it to the donee (assignee) and they are a spouse or a relative up to the third degree. To apply this exemption, it is required that the donee does not transfer the gifted real estate to another person who would not have been eligible for the exemption if the donor had gifted the real estate to them directly, for a period of three years from the date of notarization of the gift. If the donee transfers the gifted real estate to such a person before the lapse of the specified period, the exemption shall cease, and the gift transaction becomes subject to Real Estate Transaction Tax.   Relatives up to the third degree mean the following: y First degree: Father, mother, son, daughter. y Second degree: Brother, sister, grandfather, grandmother, grandson, granddaughter, son of the daughter, daughter of the daughter. y Third degree: Paternal uncle, paternal aunt, maternal uncle, maternal aunt, son of the brother, daughter of the brother, son of the sister, daughter of the sister.