What does this tool calculate?
A mixed-ownership company is a resident company owned by Saudi and non-Saudi partners, so it pays Zakat on the share of Saudis and of GCC nationals treated like them, and income tax on the share of the non-Saudi partners. You enter the Saudi ownership percentage, and the Zakat base and taxable profit for the whole business, and the tool splits them by ownership percentage and calculates Zakat, tax and the total, with the calculation steps and an Excel file with formulas that update when you change any number.
The tool does not calculate the base itself: the Zakat base is calculated under the Implementing Regulations for Zakat Collection with its additions, deductions and minimum, and taxable profit after tax adjustments; the tool then only splits them.
The regulatory rules it follows
- Zakat at 2.5% of the Zakat base for the Hijri year (Article 15 of the Zakat Collection Regulations), on the Saudi partner's share in a resident company (Article 3). Under the regulations, a Saudi is anyone holding Saudi nationality and GCC nationals treated like them.
- A non-Hijri year: the Zakat rate is based on actual days using the formula in Article 15: (2.5% ÷ days in the Hijri year) × days in the fiscal year. For a Gregorian year of 365 days and a Hijri year of 354 days the rate is about 2.5777%, and for a Hijri year of 355 days about 2.5704%.
- Income tax at 20% on the non-Saudi partners' shares of taxable income (Articles 6 and 7 of the Income Tax Law).
- Carried-forward losses are deducted from the tax base with no time limit, up to 25% of the year's profit (Article 21 of the Law and Article 11 of its Implementing Regulations). In a mixed-ownership company the tax base is the non-Saudi share, so the cap is 25% of their share of the year's profit.
Example: a company 60% owned by Saudis
A company with a Gregorian fiscal year (365 days), 60% owned by Saudi partners and 40% by non-Saudi partners. The Zakat base for the whole company is 2,000,000 SAR, taxable profit is 500,000 SAR, and the balance of carried-forward losses for the non-Saudi share from previous years is 300,000 SAR:
| Step | Calculation | Result |
|---|---|---|
| Saudi share of the Zakat base | 2,000,000 × 60% | 1,200,000 |
| Zakat rate for the Gregorian year | 2.5% ÷ 354 × 365 | 2.5777% |
| Zakat | 1,200,000 × 2.5777% | 30,932.20 |
| Non-Saudi share of profit | 500,000 × 40% | 200,000 |
| Cap on deducting losses | 200,000 × 25% | 50,000 |
| Tax base | 200,000 − 50,000 | 150,000 |
| Income tax | 150,000 × 20% | 30,000 |
| Total due | 30,932.20 + 30,000 | 60,932.20 |
That leaves 300,000 − 50,000 = 250,000 SAR of carried-forward losses for the following years. If the fiscal year were Hijri, Zakat would be 1,200,000 × 2.5% = 30,000 SAR and the total 60,000 SAR.
A loss year and a negative base
If taxable profit is a loss, there is no income tax, and the non-Saudi share of the loss is added to the carried-forward losses balance. In the same example with a Hijri year and a loss of 200,000 SAR: the non-Saudi share of the loss is 200,000 × 40% = 80,000, so the balance becomes 300,000 + 80,000 = 380,000 SAR, and Zakat stays at 30,000 SAR because the Zakat base is built on the business's funds, not on its profit alone.
If the Zakat base is negative and the business has no adjusted net profit, there is no Zakat base (Article 27 of the Zakat Regulations). But if the base is lower than adjusted net profit, the minimum base set out in the same article applies, so enter the base after applying it.
Frequently asked questions
Is a GCC partner treated like a Saudi?
Why is the Zakat rate for a Gregorian year different from 2.5%?
How much of the carried-forward losses is deducted each year?
Does the tool calculate the Zakat base?
Content last reviewed: 2026-11-04