Voluntary VAT registration
In one sentenceA business registering for VAT by choice when its taxable supplies or expenses exceed 187,500 SAR but have not reached the mandatory threshold.
Simply put
A business whose supplies are between 187,500 and 375,000 SAR a year is not required to register, but it can register.
The benefit: it deducts the VAT on its purchases and appears to business customers as registered. The cost: collecting VAT from its customers and filing returns on time.
Worked example
A new accounting services office expects annual supplies of 250,000 SAR.
Annual supplies250,000 SAR
Voluntary registration threshold187,500 SAR
Mandatory registration threshold375,000 SAR
RulingIt may register and is not required to
Don't confuse it with
VAT registrationVAT registration covers both mandatory and voluntary registration, and voluntary registration is the part decided by the business.