Transfer pricing in Saudi Arabia
Saudi Arabia's Transfer Pricing Bylaws, in force since 2019, require related-party transactions to be priced at arm's length and documented. Every taxpayer with related-party transactions files a disclosure form with its annual return; a master file and local file are required unless related-party transactions are below SAR 6 million in the year (for Zakat payers the threshold is SAR 100 million to fiscal year 2026 and SAR 48 million from 2027); and country-by-country reporting applies to groups with consolidated revenue of SAR 3.2 billion or more.
Key facts
| Standard | Arm's length principle, OECD-aligned methods |
|---|---|
| Disclosure form | With the annual return, for all related-party transactions |
| Master and local file | Income-tax payers: related-party transactions of SAR 6 million or more; Zakat payers: SAR 100 million to FY2026, SAR 48 million from FY2027 |
| Country-by-country report | Group revenue of SAR 3.2 billion or more |
| Zakat payers | Brought into the bylaws from fiscal year 2024; documentation threshold falls from SAR 100 million to SAR 48 million from fiscal year 2027 |
| Authority | Zakat, Tax and Customs Authority (ZATCA) |
Opens the assistant with Saudi Arabia already selected. Answers cite the law, guidance and cases they rest on.
Benchmarking and how often to refresh it
ZATCA's guidance follows the OECD approach: a full comparables search is expected periodically, with the financial data of the accepted comparables updated annually in between, and a fresh search whenever the facts change. The assistant quotes the guideline paragraph rather than a rule of thumb.
Cross-border GCC supply chains
A UAE affiliate supplying goods to a Saudi company is tested under both countries' rules, and the Saudi side must be able to support the price with the local file even where the UAE group already documents it. Customs valuation and VAT follow the same price, so a year-end adjustment has knock-on effects.
Frequently asked questions
- Who must keep a master file and local file in Saudi Arabia?
- Income-tax payers whose related-party transactions reach SAR 6 million in the fiscal year; Zakat payers from SAR 100 million (SAR 48 million from fiscal year 2027).
- Do Zakat payers have transfer pricing obligations?
- Yes. The bylaws were extended to Zakat payers in phases beginning with fiscal year 2024.
Primary sources
Related guides
Disclaimer: This page provides general tax information based on publicly available primary sources, reviewed on the date shown. Rules are conditional and change; the page may not reflect a change made after that date, and it is not a substitute for advice from a qualified tax professional on your specific situation.