Saudi finance ministry approves amending paragraph of real estate transaction tax regulations

Saudi Minister of Finance Mohammed Al-Jadaan

Mohammed Al-Jadaan, Minister of Finance and Chairman of the General Authority of Zakat and Tax, gave the green light for amending Paragraph A/3 of the Executive Regulations on Real Estate Transaction Tax related to tax exemptions, the Saudi Official Gazette Umm Al-Qura reported.

The number of exemptions reached 15, including transfer of real estate by inheritance, as well as free transfer of property to licensed non-profit organizations and endowments. However, this does not include the disposals for management purposes.

The exemptions also include the disposal of property to a government agency, public corporate persons, or entities and projects of public interest. Under this Paragraph, the public interest means the entities and institutions that bear this capacity under the civil association and institution regulations, as well as disposal of the real estate by a government entity as a public authority outside the framework of economic, investment or commercial business.

Additionally, the exemptions include the forcible disposal of the real estate in cases of expropriation for the public interest or the temporary seizure of the real estate, as well as disposal of the real estate as a temporary gift with the competent authority, for the husband, wife or a second-degree relative, or a legitimate will not exceeding one fourth of the testator's estate.