In brief
All real estate transactions exempt under Article 3 of the RETT Law must be registered with ZATCA following the controls in Article 12 of the Law and Article 11 of the Regulations. The transferor registers the transaction on ZATCA's electronic portal on or before the transaction date, identifying the exemption. ZATCA then issues a notice confirming registration.
A common misconception about RETT is that an exempt transaction has nothing to do with ZATCA. It does. Article 3(b) requires every exempt transaction to be registered with ZATCA, and that registration is what lets the notary complete the transfer.
The Provision: Exact Text
What It Means in Plain English
To register a RETT-exempt transaction, the transferor (or their representative) files it on ZATCA’s RETT portal before notarization and states which exemption applies. ZATCA issues a confirmation notice, and the notary relies on it. No tax is paid, but the filing is still mandatory.
What Article 11 Requires
Article 3(b) applies the registration procedure in Article 11 of the Regulations to exempt transactions.
| Requirement | Article 11 reference |
|---|---|
| Register on ZATCA’s electronic portal, whether the transaction is taxable or exempt | 11(a)(1) |
| Provide party identity details, the deed or contract reference, a property description, the exemption claimed and the agreed value | 11(a)(1)(a)–(f) |
| Register on or before the transaction date | 11(a)(2) |
| Registration is an acknowledgement by the transferor that the information is accurate | 11(a)(3) |
| ZATCA issues a notice confirming registration of an exempt transaction | 11(a)(5) |
| IPO subscriptions and trading in listed securities need no registration | 11(a)(6) |
| Taxable share transfers in real estate companies are registered by the Article 5 payment date | 11(a)(7) |
| Corrections, including a breach of exemption conditions, within 30 days | 11(b)(1) |
| Keep records proving the exemption conditions for five years | 11(f) |
Why It Matters
The notary depends on it
ZATCA’s Guideline describes the RETT service as a step to complete before transfer and notarization. In its estate-division example, it notes that registration is what allows the notary to accept the transfer.
It is the transferor’s statement
Article 11(a)(3) treats registration as the transferor’s acknowledgement that the information is correct. If you select an exemption that does not apply, the shortfall is yours, and ZATCA can assess the tax with fines. Under Article 8(D) the general assessment period is three years. Under Article 8(E), there is no time limit where an exemption’s conditions are later breached.
It starts the monitoring period
For exemptions with ongoing conditions, such as the three-year gift rule or the five-year lock-ups in Articles 3(a)(11), (13), (16), (17), (18) and (20), the registration date and the value recorded become the reference points if a breach occurs later.
Worked Examples
Example 1: Gift to a son
A father gifts land worth SAR 1,000,000 to his son. Before notarization, he registers the transaction on the portal, selects the gift exemption under Article 3(a)(7) and receives ZATCA’s confirmation notice. The notary completes the transfer. No tax is paid.
Example 2: Group transfer recorded at an understated value
A company registers an intra-group transfer under Article 3(a)(18) at book value, SAR 10,000,000, although the market value is SAR 30,000,000. In year three, the transferee is partly sold, breaching the lock-up. ZATCA can assess RETT on fair market value, not on the understated registered figure (Articles 2(c) and 8). Record a realistic value at the outset.
Example 3: Tadawul share purchase
An investor buys shares in a listed real estate company. No registration is needed, because listed trading is excluded under Article 11(a)(6).
Common Mistakes
- Assuming exempt means no filing.
- Selecting the wrong exemption. For example, Article 3(a)(17) where the company has two shareholders.
- Recording a nominal value for exempt transactions.
- Not correcting the registration within 30 days when conditions are breached.
The Bottom Line
Article 3(b) is a procedural rule, but it is the gateway to every exemption. Register before notarization, choose the correct exemption, record a realistic value, and keep the evidence. That registration will be the starting point if ZATCA reviews the transaction, possibly years later.
Key takeaways
- Article 3(b) requires every exempt real estate transaction to be registered with ZATCA under Article 12 of the Law and Article 11 of the Regulations.
- Registration is done on ZATCA's electronic portal by the transferor or their representative, on or before the transaction date.
- The form captures the parties, the deed or contract reference, a description of the property, the exemption claimed and the agreed value.
- Registering is treated as the transferor's acknowledgement that the information is accurate (Article 11(a)(3)). A wrongly claimed exemption is the transferor's responsibility.
- IPO subscriptions and trading in listed securities do not need to be registered (Article 11(a)(6)).
- Errors, or later events that breach an exemption's conditions, must be corrected on the portal within 30 days (Article 11(b)).
Frequently asked questions
Do I need to register a RETT-exempt transaction with ZATCA?
Yes. Article 3(b) of the RETT Implementing Regulations requires every exempt transaction to be registered on ZATCA's electronic portal on or before the transaction date. The only exceptions are subscriptions to publicly offered securities and trading in listed securities.
What information is needed to register an exempt transaction?
Under Article 11(a)(1): the identity details of the transferor and transferee, the reference number of the contract, instrument or title deed, a description of the property at the time of disposal, the exemption being claimed, the agreed total value (if any), and any other data ZATCA's form requires.
What does ZATCA issue after registering an exempt transaction?
ZATCA issues a notice confirming registration of the transaction (Article 11(a)(5)). The notary relies on this record to complete the transfer.
What if I registered under the wrong exemption, or the conditions later fail?
You must submit a correction request on ZATCA's portal within 30 days of becoming aware that the data is incorrect, or of the event that breaches the exemption's conditions (Article 11(b)(1)). Any resulting tax is payable by the due date in Article 5.
Is there a penalty for not registering an exempt transaction?
Failing to comply with the Law and Regulations can attract a fine. ZATCA's Guideline describes it as not exceeding the tax due or SAR 50,000, whichever is greater. In practice, an unregistered transfer usually cannot be notarized at all.
Sources
Based on the RETT Law (Royal Decree No. M/84, effective 10 April 2025), the RETT Implementing Regulations (ZATCA Board Resolution No. 01-03-25 dated 24 March 2025, unofficial English translation) and ZATCA's Detailed RETT Guideline Version 6 (May 2026). The Arabic text prevails. This article is general information, not advice on any specific transaction. dariba.co is an independent knowledge platform and is not affiliated with ZATCA.
