Saudi Country-by-Country Reporting: Scope and Deadlines

Country reporting is a separate obligation

Country-by-country reporting, or CbCR, gives tax authorities a structured view of a multinational group’s activities and financial results across jurisdictions. It serves a different purpose from the Saudi TP disclosure form and the Master and Local Files. Passing one threshold does not determine all three requirements.

Article 18 of the amended Saudi Transfer Pricing Bylaws governs reporting, local-filing circumstances and notification. Section 5.4 and the relevant notification guidance in ZATCA’s Arabic Transfer Pricing Guideline, third edition 2024, provide explanatory detail. Apply the amended Arabic text when an older English explanation predates a relevant amendment.

Apply the prior consolidated revenue threshold precisely

Article 18’s exemption uses the multinational group’s consolidated revenue in the financial year preceding the relevant reporting year. Under the current Arabic wording, the reporting requirement applies where that revenue exceeds SAR 3.2 billion. Exactly SAR 3.2 billion does not satisfy a strict exceeds test.

This is not a threshold measured by the Saudi subsidiary’s sales, profit or related-party purchases. It is also not the SAR 6 million small-enterprise test or the phased SAR 48 million/SAR 100 million Zakat file framework.

Dariba illustration: prior consolidated revenue of SAR 3.3 billion exceeds SAR 3.2 billion even if the Saudi constituent’s revenue is only SAR 40 million. The group reporting analysis remains necessary. This original illustration does not establish that the Saudi constituent must itself file the full report.

Identify the reporting entity before deciding who files

Article 18(a) covers the relevant Saudi-resident ultimate parent entity or surrogate parent entity. Establish the actual group structure and reporting designation. A foreign listed parent does not automatically make its Saudi subsidiary a surrogate parent.

The ultimate parent’s consolidated reporting responsibilities and the constituent entities included in the group matter. An ownership chart alone may omit permanent establishments and other relevant constituents.

Dariba recommendation: obtain written confirmation of the reporting entity, its tax residence, the reporting financial year and the intended filing jurisdiction. Keep that evidence with the Saudi compliance file. A group statement that someone will handle CbCR is insufficient to determine the Saudi obligation.

A foreign filing does not always remove Saudi local filing

Article 18(b) addresses specified circumstances in which a Saudi constituent that is not the ultimate or surrogate parent may nevertheless have to submit the group report locally. These include the foreign reporting entity not being required to file, the absence of an effective qualifying exchange arrangement in the relevant circumstances, and notified systemic failure.

The existence of a general international agreement is not the same as an effective qualifying competent-authority exchange arrangement by the relevant deadline. Similarly, a group’s voluntary foreign submission should not be assumed to cure every Saudi condition.

Section 5.4.1 of the guideline illustrates why foreign-parent reporting rules can matter to a Saudi constituent. The practical lesson is to test the actual Saudi local-filing conditions, rather than relying on a general claim that foreign-headquartered groups are exempt.

Multiple Saudi constituents need a coordinated designation

Article 18(c) provides for the relevant designation where multiple Saudi constituents meet the local-filing conditions. Identify the designated filer and the other Saudi constituents covered by the arrangement. This requires evidence that the statutory conditions and required notifications are met.

Dariba analysis: several Saudi subsidiaries forwarding identical group statements is not necessarily the same as an effective local-filer designation. The group should determine one consistent position and ensure each entity’s notification identifies the correct reporting entity.

A designated filing arrangement addresses responsibility for the report; it does not automatically eliminate the separate notification obligation for every relevant constituent.

Track the report and notification on separate clocks

Article 18 requires the report within 12 months after the end of the multinational group’s reporting financial year. The notification is due within 120 days after the end of the relevant taxpayer’s tax or Zakat year. The notification identifies whether the entity is the ultimate or surrogate parent and, where relevant, the reporting entity’s identity and residence.

Do not replace either deadline with a standard calendar date without checking the actual year-end. The Saudi constituent’s year and the group’s reporting year may need separate attention.

Dariba recommendation: maintain two dated obligations in the compliance calendar, with named owners and evidence of submission. An annual return or TP disclosure should not be assumed to constitute a valid CbCR notification without checking the prescribed process.

Reconcile the country tables and explain their limitations

The guideline’s reporting guidance and Annex 10 distinguish jurisdictional financial information, constituent entities and explanatory information. Revenue, profit before tax, tax paid and tax accrued are different measures. Capital, accumulated earnings, employees and tangible assets also require consistent definitions and reporting treatment.

Maintain a documented data source and consolidation approach. Explain differences arising from timing, permanent-establishment attribution or accounting presentation instead of forcing cash tax to equal current-year accrued tax.

Dariba recommendation: reconcile major totals, confirm the treatment of entities and permanent establishments, and use the explanatory information to clarify material limitations. The person preparing the tables needs access to the group data and a method for resolving local reporting differences.

CbCR is not a formula for reallocating group profit

Country-level indicators can prompt questions. They do not establish the correct price of an individual loan, service or product transaction. A jurisdiction’s profit relative to employee numbers cannot alone replace the functional and comparability analysis required by Articles 5–13.

The report should nevertheless be consistent with the commercial account given in the Master File, Local File and Saudi disclosures. Material inconsistencies need investigation and an explanation grounded in the actual data.

Read the documentation guide for the separate file framework. Meeting the CbCR requirement does not certify that the group’s pricing is arm’s length or resolve each constituent’s ordinary tax and Zakat obligations.