Understanding Zakat and Tax in Saudi Arabia
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As a country with a predominantly Muslim population, Saudi Arabia follows Islamic principles in its financial system, which includes the concepts of zakat and tax . Zakat and tax are important financial obligations that individuals and businesses in Saudi Arabia must understand and comply with. In this article, we will provide a comprehensive guide to help you understand zakat and tax in Saudi Arabia. What is Zakat? Zakat is one of the Five Pillars of Islam and is considered a religious obligation for Muslims who meet certain wealth criteria. It is a form of charitable giving that requires Muslims to donate a portion of their wealth to those in need. Zakat is mandatory and is based on the individual's accumulated wealth and assets over a specific period of time. In Saudi Arabia, zakat is regulated by the Zakat and Income Tax Law, which was enacted in 2007. According to this law, zakat is calculated at a rate of 2.5% on an individual's net wealth, which include...