Worldwide transfer pricing reference guide 2014

Saudi Arabia (continued)
Transfer pricing penalties
There is currently no specific transfer pricing penalty prescribed under the law. However, penalties as prescribed under the general
provisions of the Saudi tax law are applicable in cases of a deficiency assessment relating to a transfer pricing adjustment.
Penalty relief
No penalty relief is currently applicable under the Saudi Arabian tax law.
Documentation requirements
There is currently no requirement for taxpayers in Saudi Arabia to prepare contemporaneous transfer pricing documentation or for
documentation to be submitted to the DZIT together with the filing of tax declaration. Nonetheless, the tax payer should maintain
adequate documents to support the transaction.
Documentation deadlines
Not applicable.
Statute of limitations on transfer pricing assessments
There is no specific statute of limitations set out in the Saudi tax law with regard to transfer pricing assessments.
The general statute of limitation for the Saudi tax authority is five years and 10 years in cases where the tax return was not filed, or if
filed, was found to be incomplete or incorrect with intent of tax evasion.
Return disclosures/related party disclosures
The tax law does not require taxpayers to submit a returns disclosure with respect to related party transactions.
Transfer pricing–specific returns
There is currently no requirement to prepare a separate tax return for related party transactions.
Frequency of tax audit and transfer pricing scrutiny by the tax authority
Transactions involving related parties are reviewed in considerable depth by the DZIT to verify if the transactions were made on
an arms length basis.
APA opportunity
There is currently no APA procedure in place.
Expected reaction to OECD Report on BEPS
Currently there is no update on the DZIT’s view on BEPS.
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