Deductible investments
In one sentenceA business's investments that are deducted from its Zakat base under ZATCA's rules, such as investments in businesses inside the Kingdom that pay Zakat on their own base, to avoid paying Zakat twice.
Simply put
If your business owns a stake in another company that pays its own Zakat, including the investment in your base means paying Zakat on the same wealth twice, so it is deducted under conditions.
Not every investment is deducted: investments held for trading, for example, stay in the base, so check ZATCA's rules for each type.
Worked example
A company has 2,000,000 SAR of financing sources in its base, net fixed assets of 1,200,000 SAR, and a 300,000 SAR investment in a local company that pays its own Zakat. Its year is Hijri.
Financing sources2,000,000 SAR
Deduct: net fixed assets1,200,000 SAR
Deduct: local investment300,000 SAR
Zakat base2,000,000 − 1,200,000 − 300,000 = 500,000 SAR
Zakat (500,000 × 2.5%)12,500 SAR
Formula: Base = financing sources − deductible assets − deductible investments
Don't confuse it with
Zakat base deductionsDeducted assets is a general name for everything subtracted from the base, and deductible investments are one type of them.