Objecting to an assessment: what to document before the deadline

Stages and deadlines

The Rules of Procedure of the Zakat, Tax and Customs Committees set out the stages for challenging a ZATCA decision in sequence, each with its own deadline:

1. An objection to ZATCA within sixty days of the day after notification of the decision; ZATCA decides it within ninety days of receiving it.
2. A claim before the dispute resolution chambers of the General Secretariat of Zakat, Tax and Customs Committees within thirty days of the day after notification that the objection has been rejected or partly accepted, or after the decision period ends without a decision.
3. An appeal before the appellate chambers within thirty days of the day after receiving the decision of the first-instance chamber.

Missing these deadlines makes ZATCA's decision immune from challenge. The Rules also allow a request for referral to the internal settlement committee, which may negotiate with the taxpayer at any stage; a settlement becomes final only once the taxpayer accepts it in writing.

The same rules apply to Real Estate Transaction Tax, and ZATCA may require a cash or bank guarantee where it has reason to doubt that the disputed tax will be paid.

What to document within the deadline

1. 01The decision and the date of notificationA copy of the notice, the date and means of notification, and the adjusted items with the basis for each adjustment as ZATCA stated it. The date of notification is what starts every deadline.
2. 02Reconciling the figuresReconciling the assessment with the returns filed, the accounting records, e-invoicing data and customs data. Many assessment differences arise from different data sources rather than from a disagreement over the law.
3. 03Supporting documents for each itemContracts, tax invoices, proof of payment, export documents and evidence that goods left the Kingdom where the zero rate applies, and relevant correspondence with customers and suppliers.
4. 04The legal argumentAn independent argument for each disputed item, grounded in the Law, the Regulations or the guidelines, and informed by published committee decisions on similar issues.
5. 05PenaltiesPenalties have grounds separate from those of the assessment, such as the penalty for an incorrect return or for late payment, and so need arguments of their own.
6. 06The effect on other periodsDoes the same item recur in periods the assessment did not cover? The position taken in the objection should be read in light of its effect on those periods.

Drafting the objection

• Order the items by their financial effect, stating the amount disputed under each.
• Separate what the taxpayer accepts from what it disputes, and pay the accepted amount; an objection does not affect the obligation to pay what is not disputed.
• Build each argument in a clear sequence: the facts, then the legal provision, then its application to the facts, then the request.
• Avoid general statements, such as calling the assessment «contrary to the law» without showing how.
• Keep what is said in the objection consistent with what will be said before the committees later.

Before the dispute committees

Proceedings before the chambers are primarily written, and a chamber may hear pleadings in person or remotely. The written submissions and the document file are therefore the foundation of the decision, and arguments and documents submitted in full from the objection stage give the file a coherence that late additions cannot.

Attendance before the chambers is by the taxpayer or their representative as the law provides. The tax adviser's role is to prepare the technical submissions and to attend alongside the taxpayer or their representative to give the chamber technical explanations.

The first ten days

When an assessment notice arrives, what is done in the first days determines the quality of the objection:

1. Fix the date of notification, and calculate every deadline in a single schedule.
2. Gather the returns, records and contracts for the periods assessed.
3. Identify the basis of each adjustment, and request any clarification needed.
4. Sort the items: what is accepted, what is disputed and what needs further analysis.
5. Identify the amounts not in dispute and arrange their payment.

In summary

An objection is not a formality to preserve the right to challenge; it is the document that will be read at every later stage. The earlier it is prepared, and the more it rests on an accurate reconciliation of the figures and specific legal arguments, the wider the options open to the taxpayer, including settlement.