Saudi Arabia Transfer Pricing Documentation Requirements
Saudi Arabia requires a Master File and Local File where the arm's length value of a taxpayer's controlled transactions exceeds SAR 6 million, with a higher SAR 100 million threshold applying to Zakat payers during a phase-in period. A transfer pricing disclosure form and affidavit are filed with the tax return.
Requirements at a glance
| Requirement | Threshold | Deadline | Deadline type | Language | Penalty |
|---|---|---|---|---|---|
Master File Required | Controlled transactions > SAR 6m (Zakat payers: SAR 100m for FY24–FY26) | By tax return due date | Preparation deadline The documentation must exist by the date shown and is produced only when the tax authority requests it. Once requested, it must be provided within 30 days. | AR / EN | Yes (under the income tax law and bylaws) |
Local File Required | Same thresholds as the Master File | By tax return due date | Preparation deadline The documentation must exist by the date shown and is produced only when the tax authority requests it. Once requested, it must be provided within 30 days. | AR / EN | Yes (under the income tax law and bylaws) |
Disclosure form With affidavit
Annual filing | Taxpayers within the transfer pricing bylaws | Within 120 days of fiscal year-end | Submission deadline The documentation must be filed with the tax authority by the date shown. | AR / EN | Yes |
CbC report Required | Group revenue ≥ SAR 3,200m | 12 months after fiscal year-end | Submission deadline The Country-by-Country report is filed by the group's ultimate parent entity; a local notification identifying the reporting entity is filed separately. | — | Yes |
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Scope of the documentation obligation
A Master File and Local File are required where the arm’s length value of a taxpayer’s controlled transactions exceeds SAR 6 million in the fiscal year. A higher threshold of SAR 100 million applies to Zakat payers for the 2024 to 2026 fiscal years, after which the position changes. The documentation is held available by the return due date and produced within 30 days of a request, and a transfer pricing disclosure form with an affidavit is filed with the annual return, which is itself due within 120 days of the fiscal year-end.
Distinctive features of the Saudi regime
The defining feature of the Saudi regime is the differentiated threshold between taxpayers and Zakat payers. Entities subject to income tax, and mixed entities, are brought into the documentation requirement at SAR 6 million of controlled transactions, while Zakat payers benefit from a phased SAR 100 million threshold through the 2026 fiscal year, which reflects the staged extension of formal transfer pricing documentation across the Zakat base. The bylaws do not set out documentation-specific penalties; instead, a failure to file the declaration on time or to use the prescribed forms triggers penalties under the income tax law and bylaws. Aggregation of economically linked transactions is permitted where they cannot reliably be analysed separately.
Benchmarking and comparables
Foreign comparable transactions may be used in the absence of domestic comparables, provided differences in geographic and other factors are accounted for. Multi-year analysis of the comparables, preferably over three years, is acceptable, and a multi-year approach for the tested party may be applied in exceptional cases, such as loss-making scenarios, where sufficient reasons are given in the Local File. A comparability analysis is performed on a three-year basis where conditions are unchanged, with an annual financial update. There is no transfer-pricing-specific limitation period: the general rule allows assessment within five years of the filing deadline, extending to ten years in defined cases.
Frequently asked questions
What threshold applies to Zakat payers in Saudi Arabia?
For the 2024 to 2026 fiscal years, Zakat payers are subject to a higher Master File and Local File threshold of SAR 100 million in controlled transactions, compared with SAR 6 million for taxpayers and mixed entities, with the position changing thereafter.
This guide is an informational research aid prepared by Comp-Press and is not tax or legal advice. Transfer pricing rules change; verify current requirements before relying on them for filing.