No VAT on lease, mortgage deals signed before January 1 in Saudi Arabia

No VAT on mortgage deals signed before start of the new year. (Reuters)
Updated 04 January 2018
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No VAT on lease, mortgage deals signed before January 1 in Saudi Arabia

RIYADH: The General Authority for Zakat and Income Tax (GAZT) announced that all finance lease contracts or lease contracts expired by acquisition and concluded before Jan. 1, 2018, the date the value-added tax (VAT) was implemented on assets including cars or real estate, are exempted from VAT.
GAZT said that they are considered non-continuous supplies and are excluded from exceptions related to supplies of a consecutive nature. VAT will therefore not be collected on the installments due from these contracts Jan. 1, 2018.
The authority explained that all finance lease contracts or lease contracts expired by acquisition and concluded after Jan. 1, 2018 will be subject to the 5 percent VAT.
According to the provisions of the unified agreement for VAT, the tax law and its executive regulations, the tax will be collected on the value of the underlying asset, and the profits or benefits related to the contract will not be included because it is exempt from tax.
The tax on the total value of the goods supplied will be payable on the date of the supply of the underlying asset, the date of issue of the tax invoice, or on the date of delivery of the partial or full payment and within the amount received, whichever is earlier, provided that the date of supply is the date of delivering the goods at the disposal of the customer.
Several activities in the exempted financial sector are included in the implementing regulations of the VAT system.
These activities include interest on loans or lending fees charged with an implicit profit margin, including loans and credit cards, mortgages, finance leases, banknotes or securities transactions, as well as current accounts, deposits and savings accounts.


Saudi Cultural Exhibition concludes in Moscow

Seven Saudi films from young local directors streamed during the exhibition. (SPA)
Updated 18 June 2018
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Saudi Cultural Exhibition concludes in Moscow

JEDDAH: The Saudi Cultural Exhibition in Moscow, organized by the General Culture Authority on the sidelines of the FIFA World Cup, has concluded its activities and events.
The four-day exhibition attracted a large number of visitors, who were informed about Saudi culture, art and heritage through short films, traditional costumes, folkloric shows, and books translated into Russian.
There were also various pavilions, including for Arabic calligraphy, Saudi hospitality, Arabic coffee, henna and fine art, as well as one aimed at children. Seven films by young Saudi directors were screened, and were well received by audiences.
Seven Saudi films from young local directors streamed during the exhibition.
The exhibition was part of the General Culture Authority’s efforts to inform people about Saudi culture, art and identity.