Specialized Training in Taxation and Zakat

During current years, the Kingdom of Saudi Arabia has witnessed a great renaissance in many sectors to the development of several large projects that have achieved economic and social progress to create a brilliant future that achieves diversification in the Kingdom’s national income sources, increase investment rates which contributes to the non-oil economic transformation in the Kingdom. And at the top of this list is the revenue from taxes such as VAT, CIT, and ZAKAT, which contributed greatly to the growth of the Kingdom’s general budget.

The General Authority for Zakat, Tax, and Customs has developed a new plan in line with the Kingdom’s 2030 Vision to achieve mutual collaboration between the various sectors of the economic components to attain the best international economic practices by increasing non-oil revenues and providing significant financial added value to the Kingdom in addition to oil revenues.

The Authority had developed a rehabilitating training program to improve the skill level of the Authority’s trainees and employees. Alrikaz Training Solutions Center took a part in providing Tax and Zakat training opportunities for the Authority employees to become familiar with theoretical and scientific aspects, as well as the knowledge and information necessary to perform their duties.

The Economic Importance of Taxes and 2030 Vision

Continually, the Kingdom’s leadership has been striving for a great economic, social, and political renaissance on a global scale with a goal of not relying on oil as the primary source of revenues. For that, true economic diversity is required to propel the Kingdom into the ranks of nations.

The Saudi Tax Authority had made some adjustments to the Kingdom’s VAT system, which will be addressed in more details in the coming lines. To show the extent of the economic impacts of that decision in line with the 2030 Vision, the following objectives were highlighted.

  1. Generated tax and Zakat revenue should contribute greatly to providing more opportunities to the private sector to expand and grow.
  2. It has an effective role in facilitating the business climate and overcoming economic obstacles.
  3. It created economic stability, that contributed to achieving economic growth
  4. Providing financial cash-flow to the Kingdom that contribute to the implementation of many investment projects.
  5. Non-oil revenues provide more future financial and economic security and stability to the Kingdom.
  6. VAT, CIT, and ZAKAT helped reducing the financial burden of spending as well as helped in providing the Kingdom with a budget surplus in 202.

In sum, it clearly that non-oil revenues are becoming one of the economy’s most essential driving factors to increase investment and combat inflation, deflation, and stagnation. As a result, the Kingdom of Saudi Arabia prioritizes non-oil earnings making numerous modifications in the process which leads to financial stability and establishes a framework for enterprises, institutions, and individuals to pay their dues.

The authority in the Kingdom of Saudi Arabia is trying to establish a balanced economic and social environment that is worthy of the Saudi citizen. Therefore, as planned and according to 2030 vision, the Kingdom is aiming to achieve massive economic power, in addition to providing special training programs to develop future business leaders by the end of this decade.

The Importance of Following Up with the Authority's Amendments

The Zakat, Tax and Customs Authority recently announced a decision to amend the provisions of Article 20 of the executive regulations of the value-added tax system, emphasizing that this decision was reached after consulting with the Kingdom’s leadership on the need for some changes to further increase the Kingdom’s economic growth. This decision was supported by everyone believing that it would allow the private sector to flourish and progress. The changes were to make business easier and to maintain a stable business environment that encourages and develops the Kingdom’s financial growth.

These changes are made in all business organizations and establishments must comply with the relevant provisions of the value-added tax system, which occurs through a contract system between various bodies and sectors, and the Authority to ensure that taxes paid in full and that the companies comply with the value-added tax system’s requirements.

These amendments were based on the Kingdom’s future and are intended to generate full benefits from implementation of value-added tax as an additional source of revenue for the Kingdom beside the massive oil revenue that already exists.

Amendments Impacts on the Zakat, Tax, and Customs Authority

The amendments made by the Authority had a significant positive impact, such as:

  1. The commitment of all parties to the contracts are concluded in accordance with the laws and regulations provided by the authority.
  2. It contributes greatly to increase generated revenues from taxes as a non-oil revenue.
  3. It enables the Authority to speedy collection of tax without any delay.
  4. It contributes and help significantly large business organizations further expansion and growth.
  5. It will help enhancement of the domestic production and local manufacturing.

Overall, all benefits mentioned above will strength the Kingdom financial position, and this will help collaborations between the private and public sectors which will lead strong economic development and strong economic growth and achieving various investment ideas in line with Kingdom 2030 Vision.

Avoiding Violations Resulting from Non-Compliance with the Authority’s Regulations and their Amendments

For the Kingdom of Saudi Arabia to achieve its 2030 Vision, it had to  transform all its private and public sectors practices and policies to become compatible with international rules and regulations and to become compatible with the globalization atmosphere and environment. Such transformation is needed to to attract international investors to Kingdom attractive investment resources. To achieve this, it is necessary to create a general standardized tax system, which was set by the Zakat, Tax and Customs Authority to maintain stable tax system.

Therefore, everyone must adhere to the Authority regulations and amendments and any violations will lead to penalties. This system has undergone many modifications and changes to a large extent to further help develop the Kingdom’s economy as per the 2030 Vision.

Penalties and Violations that must be Avoided

As the Saudi Tax authorities help, provide, and encourage companies to benefits from the new regulations and amendments, they should be aware of all the any violations will cost them greatly.

The following are some of the most important violations that will expose your company to a penalty and fines:

  1. Failure to register in the VAT system.
  2. Neglecting to file your tax return for your company.
  3. Submission of incorrect, forged documents, or tax returns.
  4. Not issuing tax invoices if you are not tax registered.
  5. Preventing the Zakat, Tax, and Customs Authority employees from performing their duties.
  6. Violation of provisions of tax rules and regulations.
  7. Failure to keep invoices and records for the required legal period.

Penalties may vary depending on the violation type. If any of the violations are proven to be repeated, the Authority has the right to double the fine. The Kingdom imposes this system for the interest of the establishments in the first place and to thrive with the Kingdom’s economy.

Training Impact on Knowledge and Compliance with the Authority’s Regulations

To conclude, the Authority has worked to improve its services to help develop simple tax declaration and objections forms. As a result, the Authority has created training programs to raise awareness, inform, and help the companies to comply with the Authority’s regulations.

As one of the authorized tax and ZAKAT service provider in the Kingdom, Alrikaz Training Solutions Center provides training programs that will assist trainees in raising their skills level and enhance their knowledge to become more ready to play important roles of achieving their intended goals.

The training Alrikaz Solutions Center will provide will help to improve trainees skills and performance to successfully contribute in the Kingdom’s national development, allowing it to play a critical role in achieving financial stability by increasing the development of all sectors and creating highly skilled tax jobs for citizens.

Alrikaz Training Solutions Center.

Our firm will provide the Authority’s trainees training programs that will enable them to carry out many duties, such as:
  1. Training on how to maintain documents accuracy and consistency
  2. Clients’ problem solving
  3. Answer clients’ enquiries
  4. Provide direct answers to arising cases
  5. How to write a letter and speech
  6. How to get Tax and Zakat refunds?
  7. Point of contact with the appropriate government agencies (communication).
  8. Clarify tax rules and regulations
  9. Overall, system knowledge

In conclusion, direct training programs are proved to be one of the most effective tools of learning and the fasted to deliver. As many governmental agencies in the Kingdom are recruiting newly college graduates, particularly in taxation field, the need to train them to easily adopt the work environment is highly essential.