First Edition | August 2023

The Zakat, Tax and Customs Authority (ZATCA) The Council of Ministers issued a Resolution No. (570) dated 22 Ramadan 1442H corresponding to 4 May 2021 entailing to merge the General Authority for Zakat and Tax and the Saudi Customs Authority in one entity named Zakat, Tax and Customs Authority (ZATCA), which works on levying Zakat, collecting tax and customs duties and achieving the highest degree of compliance by tax and Zakat payers per the best practices and highest efficiency. ZATCA seeks to enable the Kingdom to be a global logistic hub by facilitating trade, protecting national security, and organizing and managing all activities related to customs work and ports in a way that guarantees leveling up its efficiency, productivity and competitiveness. This will be achieved though providing high- quality, client-centered services per the best practices. 1.5. Purpose of the Guideline This Guideline provides guidelines and basic information on the Zakatpayers not subject to Zakat as decided by the ZATCA. This Guideline shall assist in creating a clear vision and provide guidance regarding the procedures, controls, and conditions in respect with the Zakatpayers not subject to Zakat as decided by the ZATCA in accordance with the ministerial resolutions issued in this regard. This Guideline further provides practical applications and examples explaining and interpreting the mentioned ministerial resolutions as well as rules issued in this regard. This Guideline represents the concept of the ZATCA and its interpretation regarding the application of Zakat implementing regulations issued pursuant to the Ministerial Resolution (MR) No. (2216) dated 7 Rajab 1440H, as well as MR No. 57732 dated 3 Dhu al-Qi’dah 1443H. It also includes the rules for the exemption of the Zakat payer - endowment-owned (Waqf)- from Zakat collection, as stipulated by MR No. (37981) dated 9 Jumada al-Tahni 1444H and Rules of not to subjection of non-governmental associations, institutions, and training unites to Zakat, in accordance with MR no. (61600) dated 14/10/1444H. In order to obtain guidance on any special transaction, please visit ZATCA’s official website (ZATCA.gov.sa), which offers a wide range of tools and information that have been developed specifically to assist the Zakat payer, including visual guidance materials, all relevant data, as well as answers to the most FAQs. 2. Key definition The following terms and phrases referred to in this guideline shall have the meanings provided next to each of them, unless the context indicates otherwise. Any amendment made to the regulations and laws that relate to these definitions shall result in a corresponding change in the meanings of this guideline ZATCA: The Zakat, Tax and Customs Authority. Regulations: The Zakat implementing regulations issued by Ministerial Resolution No. (2216) dated 7th Rajab 1440H and any amendments thereto. Kingdom: The Kingdom of Saudi Arabia. Zakat payer: A natural or legal person who carries out an activity that is subject to Zakat in accordance with the provisions of Article 2 of the Regulations, whether it is a sole proprietorship or a company, or who carries out the activity under a license issued by a competent authority in the Kingdom. Zakat declaration: A form prepared by ZATCA that includes several elements and items, and it must be filled out and submitted by every Zakat payer. The purpose of the declaration and its submission is to disclose the amount of Zakat base and the Zakat due from the Zakatpayers. Public Waqf (endowment): An endowment that is established for public charity purposes in particular or in general. Private (family) Waqf (endowment): The endowment that is conditional upon certain individuals from the specific lineage and relatives, either by name or description. Joint Waqf (endowment): An endowment that shares the conditions of more than one type of endowment. Endower: A person who establishes the endowment.