Saudi Arabia – Deemed Supplier Rules for Digital Marketplaces

In April, 2025, the Saudi Arabia Revenue Authority (ZATCA) enacted major amendments to Saudi Arabia’s VAT Implementing Regulations. One section that has been significantly reshaped from a tax-collection perspective is the e-commerce sector. 

The amendments introduced the concept of a deemed supplier for e-commerce transactions facilitated by platform operators. These amendments have come into force on January 1, 2026. The deemed supplier rules clarified that when a digital platform operator facilitates sales on behalf of underlying suppliers, the platform operator shall be treated as the supplier for VAT purposes. 

When these conditions are met, the platform operator shall be responsible for VAT registration, collection, and remittance. It was emphasised that only platform operators that actively facilitate supply could be treated as deemed suppliers for VAT purposes. 

VAT Guide on Deemed Supplier Rules 

In December 2025, ZATCA issued clarification Guidelines regarding the rules governing the concept of the deemed supplier for platform operators. The guide clarifies the applicability of VAT rules for electronic marketplaces under the deemed supplier provisions. 

Deemed Supplier provision applies when: 

• Platform operator facilitates the supply of digital services by non-resident providers, and 
• Platform operators facilitates supply of goods or services by resident non-registered suppliers 

When the deemed supplier provision is activated, the operator is responsible for issuing VAT-compliant invoices; submitting and remitting VAT; and collecting and storing VAT documentation. 

There are cases when, under opt-out contract clauses, the underlying supplier shall be responsible for VAT, even though, under general rules, the platform operator should bear this responsibility. This shift of responsibility must be arranged between the marketplace and the particular supplier.