Saudi Networkers Services receives VAT audit assessment from Saudi tax authority
Saudi Networkers Services is moving to close out a tax review tied to its 2024 value-added tax returns after receiving an assessment from Saudi Arabia's Zakat, Tax and Customs Authority. The company says the assessed tax totals SAR 12.87 million, while related penalties of SAR 3.69 million may be waived under a fines exemption initiative if the required conditions are met.
Highlights
- Saudi Networkers Services received a VAT audit assessment from the Zakat, Tax and Customs Authority totaling SAR 12,867,182.10 in tax and SAR 3,689,808 in penalties.
- The company recorded a provision of SAR 12,867,182.10 in its financial statements for the year ended Dec. 31, 2025, in accordance with accounting standards.
- The penalties may be exempt under the tax authority's fines exemption initiative, and Saudi Networkers Services does not expect a substantive financial impact pending confirmation.
Assessment details and accounting treatment
As reported by Saudi Exchange, Saudi Networkers Services has received a notice from the Zakat, Tax and Customs Authority on the audit findings for its 2024 VAT returns. The notice sets tax assessments at SAR 12,867,182.10 and penalties at SAR 3,689,808.The company has accepted the tax differences and is finalizing the necessary procedures. It has also recorded a provision of SAR 12,867,182.10 in its financial statements for the year ended Dec. 31, 2025, in line with applicable accounting standards.
Financial impact and next steps
Saudi Networkers Services says it does not expect a substantive financial impact, pending confirmation that the penalties qualify for exemption. The tax authority indicated the penalties are covered by a fines exemption initiative, creating a path for potential waivers if the relevant conditions are satisfied.The company says it is assessing the situation and will disclose any material developments as appropriate. The case keeps the focus on tax compliance and provision management for listed companies on the Saudi market.
In our earlier article on Malaysia’s corporate tax reform discussion ahead of Budget 2027, we covered proposals to broaden the tax base by reviewing long-standing special and double deductions, while prioritizing stronger compliance and revenue collection. We also noted the emphasis on enforcement tools such as e-invoicing and data analytics, alongside ongoing adjustments to indirect tax rules and investment incentives as authorities respond to the Global Minimum Tax framework.
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