Saudi Arabia VAT on Amazon Seller Fees: What You Need to Know
Amazon charges VAT on selling fees for sellers on Saudi Arabian marketplaces. Sellers with a valid Saudi VAT ID can submit it through Seller Central to avoid being charged VAT on their Amazon fees.
Overview
Amazon sellers operating on Saudi Arabian marketplaces should understand how Value Added Tax (VAT) applies to their selling fees. Saudi Arabia requires providers of remote services to calculate and collect VAT, which means Amazon charges VAT on subscription fees and other selling-related fees for sellers who have not registered their VAT identification number.
Key Points / What Sellers Need to Know
- VAT applies to Amazon fees – Saudi Arabia's VAT regulations require Amazon to charge VAT on monthly subscription fees and other selling fees for sellers operating on Saudi Arabian Amazon websites.
- Current VAT rate – The Saudi Arabian government initially implemented a 5% VAT rate in January 2018. This rate was subsequently increased to 15% in July 2020, where it currently stands. Sellers should verify the current applicable rate in their Seller Central account.
- Non-resident sellers are affected – If you are a non-resident seller who has not provided a valid Saudi Arabian VAT ID (also referred to as a Tax Identification Number or TIN), Amazon will collect and remit VAT on your selling fees.
- Saudi-based sellers can claim exemption – Sellers physically located in Saudi Arabia who sell on Amazon's Saudi websites can provide their VAT ID to avoid being charged VAT on their Amazon selling fees.
- VAT ID registration is self-service – You can submit your Saudi Arabian VAT ID directly through your Seller Central account settings at any time.
How VAT Collection Works
Under Saudi Arabia's tax framework, remote service providers like Amazon are obligated to collect and remit VAT to the government. This means that when Amazon charges you selling fees — including your monthly Professional subscription fee, referral fees, and other applicable service charges — VAT is added on top of those fees. For sellers who have not submitted a valid Saudi VAT registration number, Amazon automatically calculates and collects VAT at the applicable rate. This collected VAT is then remitted directly to the Saudi tax authority (ZATCA, the Zakat, Tax and Customs Authority) on the seller's behalf.
How to Submit Your Saudi Arabia VAT ID
Analysis & Recommendations
Why This Matters
Saudi Arabia VAT directly impacts the cost of selling on Amazon's Saudi marketplace. Sellers who haven't submitted their VAT ID may be overpaying on fees, and non-compliance with broader VAT obligations can lead to penalties.
Key Takeaways
- Amazon collects VAT on selling fees for sellers without a registered Saudi VAT ID
- Saudi-based sellers can submit their VAT ID in Seller Central to avoid VAT charges on fees
- Saudi Arabia's VAT rate was raised from 5% to 15% in July 2020
- VAT compliance in Saudi Arabia extends beyond Amazon fees to include product sales and tax filings
Recommended Actions
- →Submit your Saudi Arabia VAT ID in Seller Central under account settings to avoid unnecessary VAT charges on your selling fees
- →Consult a tax professional familiar with Saudi VAT law to ensure full compliance with ZATCA requirements
- →Review your Amazon fee statements to verify VAT is being applied correctly based on your registration status
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