When is Zakat vs Corporate Income Tax applied in Saudi Arabia?

In mixed-ownership entities, Zakat generally applies to the Saudi-owned portion while Corporate Income Tax (CIT) applies to the foreign-owned portion.

What is the Corporate Income Tax rate in Saudi Arabia?

The standard Corporate Income Tax (CIT) rate is 20% for most sectors, with separate regimes for specific activities.

Does this calculator include withholding tax or incentives?

No. The calculator estimates Zakat and CIT only. Withholding tax, tax treaty relief, free-zone benefits, and sector incentives should be modeled separately.

How does Desatmos support tax planning in KSA?

Desatmos builds compliant Zakat/CIT models, validates Zakat bases, and optimizes ownership and operating structures for expansion into Saudi Arabia.

KSA Zakat vs. CIT Ownership Calculator

Tax & Zakat Base Inputs

Net Profit / (Loss) before Tax (SAR)

SAR

Non-Deductible Expenses (SAR)

SAR

e.g., Entertainment, fines, unapproved donations. Added back to Net Profit.

Ownership Structure (%)

Saudi Share (Zakat) 50%

Foreign Share (CIT) 50%

Adjust Saudi Ownership (%)

Combined Total Liability

0 SAR

Detailed Liability Breakdown

Taxable/Zakat Base (Adjusted Profit) 0 SAR

■ Zakat Payable (2.5%) 0 SAR

■ Corporate Tax Payable (20%) 0 SAR

Total Zakat + CIT 0 SAR

Frequently asked questions

When is Zakat vs CIT applied in Saudi Arabia?

Zakat generally applies to the Saudi-owned portion of the business, while Corporate Income Tax applies to the foreign-owned portion.

Is Zakat calculated on profit or on a base?

Zakat is assessed on a defined Zakat base (not purely profit). The calculator offers a quick profit-proxy mode and an advanced mode where you can input a Zakat base estimate.

Can loss carryforwards reduce both Zakat and CIT?

Loss carryforwards typically reduce CIT calculations, not Zakat. Always confirm with your auditor.

What is the statutory CIT rate?

Standard CIT is 20% for most sectors (separate regimes may apply for certain activities).

Does this include withholding tax, incentives, or sector exceptions?

No. This tool estimates Zakat and CIT only. Withholding tax, tax treaties, free-zone/zone incentives, and sector exceptions should be modeled separately.

How can Desatmos help?

We build compliant tax models, validate Zakat bases, and optimize ownership and operating structures to reduce effective tax burden legally.

Connect with our consultant for tailored Saudi Services

E-mail

info@desatmos.com

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Q: Is Zakat calculated on profit or on a base?

Zakat is typically assessed on a defined Zakat base rather than pure profit. For quick estimates, a profit proxy may be used; for accuracy, compute a Zakat base.

Q: Can loss carryforwards reduce both Zakat and CIT?

Loss carryforwards generally reduce CIT calculations but do not reduce Zakat. Confirm applicability with your auditor.

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Zakat vs Corporate Tax Calculator