How to Calculate 15% VAT in Saudi Arabia: Formulas, Reverse VAT and Examples
Quick answer: VAT in Saudi Arabia is 15%. To add VAT, multiply the price by 1.15 (1,000 → 1,150 SAR). To remove VAT from a price that already includes it, divide by 1.15 (1,150 → 1,000 SAR). The VAT inside a VAT-inclusive amount is the amount × 15 ÷ 115.
The 4 VAT formulas
| You want | Formula | Example |
|---|---|---|
| VAT on a price | price × 0.15 | 1,000 × 0.15 = 150 |
| Price with VAT | price × 1.15 | 1,000 × 1.15 = 1,150 |
| Price without VAT | total ÷ 1.15 | 1,150 ÷ 1.15 = 1,000 |
| VAT inside a total | total × 15 ÷ 115 | 1,150 × 15 ÷ 115 = 150 |
The common mistake: 15% of the total
If a receipt shows 1,150 SAR including VAT, the VAT is not 1,150 × 15% = 172.50. That takes 15% of an amount that already has VAT in it. The right way is 1,150 ÷ 1.15 = 1,000, so the VAT is 150 SAR.
Ready table: adding 15% VAT
| Price before VAT (SAR) | VAT 15% (SAR) | Total with VAT (SAR) |
|---|---|---|
| 100 | 15 | 115 |
| 500 | 75 | 575 |
| 1,000 | 150 | 1,150 |
| 5,000 | 750 | 5,750 |
| 10,000 | 1,500 | 11,500 |
Ready table: removing VAT from a total
| Total including VAT (SAR) | Price before VAT (SAR) | VAT inside (SAR) |
|---|---|---|
| 115 | 100 | 15 |
| 1,000 | 869.57 | 130.43 |
| 1,150 | 1,000 | 150 |
| 5,000 | 4,347.83 | 652.17 |
| 11,500 | 10,000 | 1,500 |
VAT rate history in Saudi Arabia
- 1 January 2018: VAT started at 5%.
- 1 July 2020: the standard rate rose to 15%, the rate today.
When must a business register for VAT?
| Taxable sales in 12 months | Registration |
|---|---|
| More than 375,000 SAR | Mandatory |
| From 187,500 to 375,000 SAR | Voluntary (optional) |
| Less than 187,500 SAR | Not required |
Registered businesses add VAT to their invoices and show their 15-digit VAT number. You can make a simple invoice with the invoice generator.
Zero-rated and exempt supplies
| Zero-rated (0%) | Exempt (no VAT) |
|---|---|
| Exports of goods | Residential rent (not hotel stays) |
| International transport | Most margin-based financial services |
| Qualifying medicines and medical equipment | Life insurance |
| Investment gold, silver and platinum (99%+) | Interest on loans |
Sales of real estate are not charged VAT; they pay a separate 5% real estate transaction tax. Special cases need a tax adviser or the ZATCA guides.
Frequently asked questions
How do I calculate 15% VAT?
Multiply the price by 0.15 to get the VAT, or by 1.15 to get the total with VAT. Example: 200 × 1.15 = 230 SAR.
How do I remove VAT from a total?
Divide the total by 1.15. Example: 2,300 ÷ 1.15 = 2,000 SAR before VAT, so the VAT is 300 SAR.
How much is VAT on 1,000 SAR?
150 SAR, and the total with VAT is 1,150 SAR.
When did VAT become 15% in Saudi Arabia?
On 1 July 2020. VAT started at 5% on 1 January 2018.
Is house rent subject to VAT?
No. Residential rent is exempt from VAT. Commercial rent and hotel stays are charged 15%.
Official sources
- ZATCA: About VAT (start on 1 January 2018 at 5%)
- ZATCA: Guideline for tax invoicing and records under VAT
- Wafeq: VAT registration thresholds in Saudi Arabia (ZATCA)
This guide explains the general rules. It is not legal advice.