How many years after can deduct VAT input tax?

    3 months ago


How many years after can deduct VAT input tax?

The answer is five years 

The Implementing Regulations allows a Taxable Person to deduct Input Tax in a tax period subsequent to that tax period including the date of supply, subject to a statutory limitation of five years following the year in which the supply takes place.

Article 44 of the VAT Implementation 

“A deduction of Input Tax may be made by a Taxable Person in a Tax Period subsequent to that Tax Period including the date of Supply, provided that the Taxable Person remains eligible to make such deduction under the other provisions of these Regulations. Input Tax may not be deducted in any period which falls more than five calendar years after the calendar year in which the Supply takes place.”

Example (26): Al Faris Co receives legal services from a KSA lawyer which are completed on 21 March 2018. The invoice for the services is issued on 31 March 2018 and sent to the commercial manager who instructed the lawyer. The commercial manager takes some time to obtain approval to process the invoice, and it is not sent to the finance team until after the VAT return for the first quarter ending 31 March 2018 is filed. Instead of making an adjustment to the first quarter’s return, Al Faris Co is able to include the Input Tax deduction in the VAT return for the second quarter to 30 June 2018.


Saudi vat law

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