How Can Companies Challenge Decisions Issued by the Zakat, Tax, and Customs Authority?

How Can Companies Challenge Decisions Issued by the Zakat, Tax, and Customs Authority?

The Saudi regulator has granted companies and establishments subject to zakat the right to object to decisions issued by the Zakat, Tax, and Customs Authority. Often, ZATCA issues zakat assessments obliging companies to pay incorrect or inflated amounts—whether due to errors or partial miscalculations. In such cases, companies are entitled to object and, if necessary, escalate the matter.

In this article, Salamah Law Firm outlines the full legal procedures involved in filing objections and appeals against ZATCA decisions. There are three main stages companies may need to pursue:

1. Objecting to ZATCA Decisions

The first step is to submit a formal objection to the zakat assessment through the ERAD portal, directed to the competent department within ZATCA. For the objection to be valid, the following conditions must be met:

Deadline: The objection must be filed within 60 days from the date of the zakat assessment notification. If not submitted in time, the assessment becomes final.

Content: The objection must clearly state the points of dispute, the legal and factual basis for the objection, and must be supported by relevant documents.

Payment obligations: The company must settle any non-contested amounts of the zakat assessment within the 60-day objection period.

For contested amounts, the company must either:

Pay 10% of the zakat amount related to the disputed items (not exceeding 25%), or

Provide an acceptable financial guarantee.

Once received, ZATCA conducts an internal review through the Objections and Review Department. A response must be issued within 90 days, resulting in one of the following:

Full acceptance: A new revised zakat assessment is issued.

Partial acceptance: A modified zakat assessment is issued, reflecting the accepted portion of the objection.

Rejection: The original assessment stands, and the objection is dismissed.

If the objection is partially accepted or rejected, companies have two options:

File a formal grievance with the General Secretariat of Tax Committees, or

Request a dispute settlement through the Zakat Dispute Settlement Committee.

2. Settlement Before the Zakat Dispute Committee

This committee acts as a conciliatory body between ZATCA and the taxpayer. Either party may submit a request for dispute resolution. Once a request is filed:

Any formal grievance proceedings are suspended pending the committee’s review.

The committee must notify the applicant of its decision to accept or reject the settlement request within 30 days.

If accepted, the committee issues a settlement decision, which:

May be accepted by the company, in which case ZATCA issues a new zakat assessment; or

May be rejected by the company, in which case the grievance process resumes before the tax committees.

3. Grievance Before the Tax Violation and Dispute Resolution Committees

If a company wishes to escalate a final decision from ZATCA, it must file a grievance within:

30 days from the date of receiving the zakat assessment or objection rejection, or

If 90 days have passed without a response to the original objection (silent rejection), the grievance may also be filed.

Filing the grievance:

The company must submit its case via the Tax Committees’ online portal, by creating a new case and providing the necessary information and documentation.

Judicial timeline:

The Primary Committee must issue its ruling within 60 days from the date of the first hearing (except in extended cases).

The decision must be delivered to the parties within 30 days from the date of issuance.

The company has the right to appeal the committee’s decision.

Under Article 33, rulings become final in the following cases:

The value of the disputed amount is less than SAR 50,000.

The appeal period lapses without an appeal being filed.

Both parties reach a settlement or agree to resolve the matter before the committee.

Appealing Tax Committee Decisions

Companies may appeal a ruling within 30 days of receiving the decision by submitting an appeal through the online system of the General Secretariat. The appeal must:

Identify the appealed decision.

Present the legal grounds and requested relief.

If the initial filing is incomplete, the appellant has 15 days to correct the deficiency, or the appeal may be dismissed.

Once the appeal is accepted:

The Secretariat notifies the opposing party, who has 30 days to respond (with a possible 30-day extension).

The appellant may reply to the opponent’s response within 10 days.

If no reply is filed within the set timelines, the case proceeds to the Appeals Committee for adjudication.

The path to challenging zakat decisions involves multiple legal stages—objection, dispute settlement, grievance, appeal, and potentially a request for reconsideration—before a decision becomes final and enforceable. This complex process demands strict compliance with procedural rules and legal timelines.

At Salamah Law Firm, we provide comprehensive legal counsel and full representation for companies facing zakat, tax, or customs disputes. Our experienced legal team specializes in handling objections, grievances, and litigation before the relevant committees and authorities to ensure your rights are fully protected.

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