How is RETT calculated?
The tax is 5% of the property value when it is sold or ownership is transferred, and it is paid before the title deed is transferred. Property sales have been exempt from VAT since October 2020, when RETT replaced it.
A citizen's first home: the state pays the tax on the first SAR 1,000,000 of the price, and the buyer pays 5% of anything above that. Example: a first home at SAR 1,200,000: the tax is 60,000, the state pays 50,000 and the buyer pays SAR 10,000.
Brokerage
A real estate broker's commission is usually no more than 2.5% of the deal value, plus 15% VAT because it is a service.
FAQ
Who pays RETT, the seller or the buyer?
The seller is responsible for paying it to ZATCA, but the parties can agree that the buyer bears it, which is common in the market.
Does the first-home relief cover land?
The relief covers ready homes and off-plan units for citizens. It does not cover land or self-build.
Are any transfers exempt?
Yes, for example distribution among heirs, gifts to relatives up to the third degree and other cases listed in the regulations. Check the ZATCA website.
This is an estimate. Exempt cases and details are in the RETT regulations on the ZATCA website.