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09 May 2018

Saudi Arabian Tax Administration upholds statute of limitations

Following an appeal against a tax assessment by Saudi Arabia's General Authority for Zakat and Tax (GAZT), the GAZT acknowledged the taxpayer's contention that the "Statue of Limitations," set forth in the Income Tax Law [ITL] Article 65[a], barred them from issuing an assessment after the elapse of the statutory period of five years from the date of the filing of a tax declaration.

Statutory period of tax assessment

  1. ITL Article 65[a] provides that, "the GAZT may, with reasonable notification, make or amend a tax assessment within five years from the end of the deadline specified for the filing of the tax declaration for the taxable year, or at any time, upon written consent of the taxpayer."
  2. The Bylaws to ITL Article 59(8) provide that, "subject to the provisions of ITL Article 65[b] (see below), the return is considered accepted by the GAZT after five years from the date of filing, if the taxpayer has not received a notice to the contrary from the Department."
  3. Bylaws to ITL Article 65[b] provide that, "the Department may make or amend an assessment within ten years of the deadline specified for filing the tax declaration for the taxable year if a taxpayer does not file its tax declaration, or it is found that the declaration is incomplete or incorrect with the intent of tax evasion."

In a similar situation, the Saudi Arabian Tax Appellate Committee [HAC] upheld a taxpayer's contention that the GAZT cannot raise an assessment after the lapse of the statutory time limit.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young & Co (Public Accountants), Riyadh

  • Asim Sheikh
    asim.sheikh@sa.ey.com
  • Ahmed Abdullah
    ahmed.abdullah@sa.ey.com
  • Amr Farouk
    amr.farouk@sa.ey.com
  • Altaf Sarangi
    altaf.sarangi@sa.ey.com
  • Craig McAree
    craig.mcaree@sa.ey.com
  • Hosam Abdulkareem
    hosam.abdulkareem@sa.ey.com
  • Imran Iqbal
    imran.iqbal@sa.ey.com
  • Michael Hendroff
    michael.hendroff@ae.ey.com
  • Nitesh Jain
    nitesh.jain@sa.ey.com
  • Parvez Maqbool
    parvez.maqbool@sa.ey.com
  • Sohail Nini
    sohail.nini@sa.ey.com
  • Stuart Halstead
    stuart.halstead@sa.ey.com
  • Vladimir A. Gidirim
    vladimir.gidirim@sa.ey.com
  • Yousef Eldaw
    yousef.eldaw@sa.ey.com

Ernst & Young & Co (Public Accountants), Al-Khobar

  • Syed Farhan Zubair
    farhan.zubair@sa.ey.com
  • Ali Sainudheen
    ali.sainudheen@sa.ey.com
  • Hatem Ghobara
    hatem.ghobara@sa.ey.com
  • Javed Aziz Khan
    javed.aziz@sa.ey.com
  • Jude deSequeira
    jude.desequeira@sa.ey.com

Ernst & Young & Co (Public Accountants), Jeddah

  • Franz-Josef Epping
    franz-josef.epping@sa.ey.com
  • Ayman Abu El Izz
    ayman.abueIzz@sa.ey.com
  • Hanif Khatri
    hanif.khatri@sa.ey.com
  • Hussain Asiri
    hussain.asiri@sa.ey.com
  • Imran Ahmed
    imran.ahmed@sa.ey.com
  • Irfan Alladin
    irfan.alladin@sa.ey.com
  • Mohammed Desin
    mohammed.desin@sa.ey.com

Ernst & Young LLP, Middle East Desk, Houston

  • Gareth Lewis
    gareth.lewis1@ey.com

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ATTACHMENT

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Document ID: 2018-5618

 
 

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