When must you register for VAT? Mandatory and voluntary thresholds

Whether you must register for VAT depends on the value of your taxable supplies over 12 months.

Mandatory registration

If your taxable supplies over the past 12 months — or expected over the next 12 months — exceed SAR 375,000, registration is mandatory.

Voluntary registration

If your taxable supplies or your VAT-bearing expenses exceed SAR 187,500 (but stay below SAR 375,000), you may register voluntarily. It can make sense if you buy a lot with VAT and want to reclaim it as input tax.

Below SAR 187,500

Registration is not required.

Watch out

• Register on time: late registration carries a fine, so apply as soon as you cross the threshold.
• Once registered, file every return on time — even when no tax is due.
• Related companies may be able to register as a VAT group, subject to conditions.
• Registration now affects e-invoicing: the latest integration wave also starts at SAR 187,500 of revenue.