What counts as VAT-subject revenue for a ZATCA wave threshold?

For ZATCA Phase 2 wave selection, the relevant criterion is revenue subject to VAT for the specific years identified in the wave announcement.

This is different from simply looking at a company's total revenue or current-year turnover. Businesses need to consider the revenue that falls within the scope of VAT when assessing whether they meet a particular wave's threshold.

For Wave 25, ZATCA specifically stated that the selection criterion is taxpayers whose revenues subject to VAT exceeded SAR 187,500 during 2022, 2023, 2024, or 2025.

Because different waves can specify different years and thresholds, businesses should assess their revenue against the exact criteria published by ZATCA for the relevant wave.

If there is uncertainty about whether a particular revenue stream is subject to VAT, businesses should review the applicable Saudi VAT rules and their tax records rather than automatically treating total company revenue as the wave-selection figure.

Key points

• ZATCA uses VAT-subject revenue for wave selection.
• Total company revenue should not automatically be treated as the relevant figure.
• The applicable years depend on the specific ZATCA wave.
• Wave 25 considers 2022, 2023, 2024, or 2025.
• Wave 25 uses a threshold of more than SAR 187,500.