Cross-border
VAT registration thresholds: UK vs KSA
Two VAT systems, two rates, two sets of thresholds. What triggers registration in each country, and how groups get caught out.
23 April 2026 · 6 min read · By the Meridian team
The headline numbers
In Saudi Arabia, VAT is 15%. Registration is mandatory once taxable supplies exceed SAR 375,000 in the preceding or expected twelve months, with voluntary registration available above SAR 187,500. In the UK, VAT is 20% standard-rated, with registration mandatory above the rolling twelve-month taxable turnover threshold and deregistration available once turnover falls below the lower limit.
Rolling twelve months, not the financial year
Both regimes test a moving window. Businesses miss registration because they check turnover at year end rather than monthly. A single large contract can push you over in the middle of a quarter, and the obligation starts from that point, not from your next accounting period.
Non-residents get no threshold in KSA
A non-resident making taxable supplies in Saudi Arabia must register from the first riyal and appoint a tax representative. This regularly catches UK companies delivering services to Saudi clients who assumed the SAR 375,000 threshold applied to them.
Place of supply decides everything
For B2B services, VAT generally follows the customer's location under reverse charge. For B2C and for goods, the rules diverge. Before invoicing across borders, settle the place of supply in writing — retrospective corrections mean credit notes in two jurisdictions.