Saudi Press

Saudi Arabia and the world
Monday, Jul 21, 2025

Certified used car’s VAT will be calculated on the basis of sales profit margin conditionally

Certified used car’s VAT will be calculated on the basis of sales profit margin conditionally

The Zakat, Tax and Customs Authority announced that it is possible to calculate the value-added tax (VAT) on the profit margin of the sale of certified used cars, without taking into account of the total sale value. This regulation will be implemented conditionally, effective from July 1, 2023.
The authority stated that calculation of tax according to the profit margin method comes as an effort by the authority to reduce the value of VAT on certified used cars. It clarified that the profit margin method targets car agencies and showrooms registered with the authority for VAT purposes and those who engage in car trading activity in accordance with specific conditions.

The authority stressed that the method of calculating the value-added tax on the profit margin is not mandatory, as the tax can be applied to the entire sale amount due in line with the currently applied method.

The authority confirmed that there are certain terms and conditions to be fulfilled for calculating VAT on the basis of profit margin method. Most notable among these conditions is that the car must be classified as a certified used car by the authority, and that the car must be present and previously used in the Kingdom. Also, the seller shall be registered with the authority for VAT purposes. The terms and conditions also include that this is applicable to those licensed to engage in car trading activity, and the licensed dealer must obtain the approval of the authority in order to be considered qualified to use the profit margin method on certified used cars.

Under this, VAT will be imposed on the difference between the purchase price and the selling price in terms of the realized profit margin, instead of being charging VAT on the total car sale value.

The authority called on the consumers, who have any queries, to contact it via the unified call center number (19993), which operates around the clock, seven days a week, or through the “Ask Zakat, Tax and Customs” account on Twitter (@Zatca_Care) or via e-mail (info@zatca.gov.sa), or through instant conversations via the authority’s website (zatca.gov.sa).
Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Nvidia Becomes World’s First Four‑Trillion‑Dollar Company Amid AI Boom
Iranian President Reportedly Injured During Israeli Strike on Secret Facility
Kurdistan Workers Party Takes Symbolic Step Towards Peace in Northern Iraq
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
AI Raises Alarms Over Long-Term Job Security
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Russia Formally Recognizes Taliban Government in Afghanistan
Mediators Edge Closer to Israel-Hamas Ceasefire Agreement
Emirates Airline Expands Market Share with New $20 Million Campaign
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
Iran's Parliament Votes to Suspend Cooperation with Nuclear Watchdog
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
Explosions Rock Doha as Iranian Missiles Target Qatar
“You Have 12 Hours to Flee”: Israeli Threat Campaign Targets Surviving Iranian Officials
Oman Set to Introduce Personal Income Tax, First in Gulf
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
We have new information and breaking details to share about what is shaping up to be a historic air campaign tonight
Six Massive Bombs Dropped on Fordow; Trump: 'A Historic Moment for the U.S., Israel, and the World'
Fordow: Deeply Buried Iranian Enrichment Site in U.S.–Israel Crosshairs
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Pakistan to nominate Trump for Nobel Peace Prize.
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
G7 Leaders Fail to Reach Consensus on Key Global Issues
Mass exodus in Tehran as millions try to flee following Trump’s evacuation order
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Netanyahu Signals Potential Regime Change in Iran
×