Overview
Assignment 1
Answer all Questions (Maximum Marks 15)
Q1. Define the concept of residency according to Saudi Tax law. Explain in your answer when a natural person and a company are considered residents. (3 Marks)
Answer:
Q2. A resident capital company has both Saudi and non-Saudi shareholders and its capital is divided between them equally. Net income for 2023 was 3,000,000 SR and was adjusted according to the tax rules applicable in the kingdom is 3,200,000 SR. (4 Marks)
Required:
- Compute the tax amount to be paid by the company.
- Compute the tax amount to be paid by non-Saudi shareholders assuming that dividends paid in cash of 1,000,000 SR.
Answer:
Q3. The following information was taken from the zakat giver’s return for 2023:
- He owns a Building with a book value of SR 900,000 and re-evaluated according to its market value of SR 1, 200,000. The building earned a yearly rental income of SR 100,000 and the actual expenses of getting the income of SR 20,000, due liabilities of SR 30,000 and long-term liability for 50,000.
- He also owns cars with a book value of SR 250,000 and re-evaluated according to its market value of SR 150,000. The cars earned a yearly rental income of SR 75,000 and the actual expenses of getting the income of SR 15,000, due instalments of SR 30,000.
Required: calculate the zakat due for 2023 assuming the receptacle reaches the NISAB.
Answer: (4 Marks)
Q4. Articles 12 and 13 of the Saudi Income Tax Law differentiate between deductible and non-deductible expenses. Explain the difference between these expenses, and list five non-deductible expenses. (4 Marks)
Answer: