What does this tool calculate?
When a business resident in the Kingdom pays an amount to a non-resident party (fees, technical services, royalties, rent…), it withholds tax from the amount and pays it to ZATCA. The tool calculates the tax on each payment according to its type, the net amount transferred to the beneficiary, and the deadline to pay the tax and file the monthly return for each month.
Withholding rates
- 20%: management fees.
- 15%: royalties, land transport within the Kingdom, and any other payments.
- 5%: dividends, rent, loan interest, insurance and reinsurance, technical and consulting services, air tickets and air and sea freight, and international telephone services.
The tax is calculated on the full amount paid, and is paid with the monthly return within the first ten days of the month following the month of payment.
Worked example
In October 2026, a business paid non-resident parties: consulting services of 120,000 SAR, a royalty of 40,000 SAR, and equipment rent of 15,000 SAR:
- Consulting: 120,000 × 5% = 6,000.00 SAR.
- Royalty: 40,000 × 15% = 6,000.00 SAR.
- Rent: 15,000 × 5% = 750.00 SAR.
The withholding tax is 12,750.00 SAR, the net amount transferred is 162,250.00 SAR, and the deadline to pay it and file the return is 10 November 2026.
If the business bears the tax
Sometimes the two parties agree that the beneficiary receives the full amount and the business bears the tax. In that case the agreed amount is net, and the tax is calculated on the gross amount after grossing up: gross = net ÷ (1 − rate). So if you agreed on 95,000 SAR net for technical services: gross 95,000 ÷ (1 − 5%) = 100,000.00 SAR, and the tax is 5,000.00 SAR.
Limits of the tool
The tool does not decide whether a payment is subject to withholding in the first place, or its type; that depends on the contract and where the service is performed. If the beneficiary is resident in a country that has a double taxation agreement with the Kingdom, the rate may be lower under the agreement's conditions. Late payment carries a penalty of 1% of the unpaid tax for each thirty days; calculate it in the late-payment penalties calculator. The final reference is the official text and your business's account with the competent authority.
Frequently asked questions
What is the withholding rate on technical and consulting services?
When is withholding tax paid?
Is the tax calculated on the amount before or after the deduction?
Content last reviewed: 2026-10-28