In an effort to facilitate taxable persons’ tax compliance and improve their cash flows, the Zakat, Tax and Customs Authority (“ZATCA”) has issued decision no (21-02-06) dating 26/02/1443 H. The decision was published in the Official Gazette on 8 October 2021 and is considered effective from 1 November 2021.
The decision specifies amendments to Article 20 of the VAT Implementing Regulations which regards the date of supply (“DOS”) in specific circumstances.
Of these amendments, the following aspects are noteworthy:
- DOS for a continuous supply of services where contract stipulates specific payment terms: the earliest of the payment due date, actual payment, and date of issuance of invoice;
- DOS for supplies to governmental entities (hereinafter “B2G Supplies”) as part of procurement contracts: the earliest of the issuance of the payment order or date of receipt of payment or part thereof and to the extent paid.