The Ministry of Housing revealed that the total number of certificates of exemption from value-added tax for first homes issued to date has reached 3,863, while the number of applications received by the ministry has reached approximately 5,620, and 612 applications were rejected for failing to meet the requirements over the past 30 days.
In a press statement today, the Ministry clarified that all applications received by the Ministry are reviewed to ensure they meet the conditions set forth in the Royal Decree, which stipulates “the state shall bear the value-added tax (VAT) on the first home for an amount not exceeding 850,000 riyals of the purchase price of the first home.”
Last month, the Ministry of Housing and the General Authority for Zakat and Income announced the mechanism for implementing the royal decree stipulating “the state to bear the value-added tax,“ through registration on the designated website via the following link: vat.housing.sa, followed by the issuance of an electronic certificate by visiting the online portal.
The Ministry urged citizens who meet the conditions to submit their applications electronically and obtain an electronic certificate proving their eligibility for the state to cover the value-added tax on their first home, not exceeding the price ceiling specified in the royal decree. The the Ministry of Housing will process the data and verify its compliance with the requirements, then issue a certificate of eligibility confirming the eligibility of the citizen wishing to purchase, which the citizen must present to the property seller at the time of purchase, The VAT will be paid directly to the seller by the Ministry after verifying the validity of the sale and purchase transaction and receiving all documents required for payment from the property seller.
It should be noted that the Ministry of Housing announced at the time that all beneficiaries officially listed on the Ministry’s current lists or the Real Estate Development Fund’s lists will be automatically added to the electronic system, stating that any citizen wishing to purchase their first home can benefit from the VAT waiver even if they are not included in the Ministry’s or the Fund’s lists.
The beginning of 2018 saw the issuance of a package of royal decrees; aimed at alleviating the economic burden on citizens. Among these decrees is the state’s coverage of the value-added tax on amounts not exceeding (850,000) eight hundred fifty thousand riyals of the purchase price of a citizen’s first home.
On February 5, 16 government agencies announced the launch of the ”Housing Program,“ one of the programs designed to achieve the Kingdom’s Vision 2030, which aims to provide housing solutions for Saudi families, with the goal of raising the homeownership rate to 60% by 2020 and reaching 70% by 2030. Through this program, numerous initiatives will be implemented to provide integrated housing solutions for citizens, enabling them to find the housing option that best suits their needs. This will be achieved through the concerted efforts of these agencies and by overcoming all obstacles that hinder the implementation of their initiatives aimed at empowering citizens to own their own homes.
