Saudi Arabia - VAT refund opportunity for individual property sellers

Under Royal Order No. 54152 (05/07/1447H) and the implementing mechanisms and procedures approved by ZATCA's Board (Resolution No. 10-04-26, 03/03/1448H / 16 August 2026), VAT is not considered due on qualifying real estate sales by individuals from 1 January 2018 until RETT took effect on 4 October 2020. The mechanisms were published in Umm Al-Qura on 13 October 2026. VAT applied at 5% until 30 June 2020 and 15% from 1 July 2020, subject to the transitional rules.

• Individuals who registered for VAT, or were assessed, because of a one-off sale of personally owned land or property, and paid the VAT.
• Individuals registered for VAT for other business activities who declared and paid VAT on a property sale.
• Individuals who paid VAT retrospectively through a voluntary disclosure, a ZATCA assessment or a committee decision.

For a VAT refund, the individual must:

• Be a natural person who paid VAT to ZATCA on a property sale involving transfer of ownership during the relevant period.
• Not have sold real estate on a continuous and regular basis to generate income.
• Not have made more than one real estate supply within 12 consecutive months where the combined value exceeds the applicable mandatory VAT registration threshold (SAR 1 million until 19 December 2018; SAR 375,000 from 20 December 2018).
• Not have deducted input VAT related to the property.
• Not have already recovered the VAT from another government entity.

• Eligible individuals may recover VAT previously paid on qualifying property sales, along with any related penalties paid (if any).
• The Royal Order also provides for cancellation of VAT (already assessed) that is not due subject to applicable conditions.
• Refund claims must be filed directly before the tax dispute resolution committees through the GSTC’s Hiyad portal.
• Following a final favorable decision, the individual can request the refund through ZATCA’s portal.

Refund claims are due within 30 days of publication on 13 October 2026 (i.e., Wednesday 11 November 2026). Gathering evidence for 2018 to 2020 sales takes time, so early action is recommended.

• Reviewing historical property sales, VAT returns, assessments and payment records against the eligibility conditions.
• Assessing eligibility and quantifying the VAT and penalties that may be refunded, cancelled or waived.
• Preparing the claim and supporting evidence, and assisting with filing on Hiyad, subject to independence and professional requirements.