SZTAC 115/2020/IAR;2018/1519/Z

It cannot be assumed that an increase in a current account is intended for financing fixed assets without the existence of a direct connection between the increase in the current account and the asset that was funded.

Background

On Wednesday, 25/03/1442 AH corresponding to 11/11/2020 AD, the First Appellate Circuit of Income Tax Violations and Disputes constituted according to Saudi Arabia Royal Order No. 65474/1439 dated 23/12/1439 AH, held at its headquarters in Riyadh, to consider the appeal brought by .... Company, Chartered Accountants and Auditors on 04/03/1438 AH to challenge the Second Circuit of the First Instance Tax Zakat Objection Committee in Jeddah, decision No. (29) of 1437 issued in Case No. (8) of 1436 AH filed by the appellant against GAZT, in which the preliminary decision determined that:

First: To admit in form the objection submitted by .... Company on the Zakat assessment made by GAZT from 2007 to 2009.

Second: On merits:

To support GAZT to add SAR (41,536,047) to finance the fixed assets for 2007.
To resolve the dispute regarding the real estate item for 2007 to 2009.