Elementor #34975

Tax Losses in Saudi Arabia

Saudi Arabia Income Tax Law allows tax losses of mixed and Income Tax only companies to be carried forward indefinitely and until they are completely set-off. 

Tax losses can only be carried forward and be offset against 25% of each year’s taxable profits.

Example

Company X is a 100% foreign owned LLC in Saudi Arabia. In year 2xx0 had taxable carried forward losses of SAR 1,000,000.

In year 2xx1 the same company had taxable profits of SAR 3,000,000.  It can offset only 250,000K (1,000,000 X 25%) of taxable losses from the previous year.

Therefore its taxable profit for year 2xx1 will be SAR 2,750,000.