Summary of the new amendments to the Executive Regulations for Law No (46) of 2006 concerning Zakat and Contribution of Public and Closed Shareholding Companies in State Budget

2

Executive rule

number Summary of amendments

(4)

Concerning Submission of Zakat Declaration

Additional attachments and statements are required along with Zakat declaration such as:

1. An audit report prepared and approved by an auditor registered in Ministry of Commerce as

per the report form approved by Ministry of Finance.

2. Statement of analysis of expenses including the following:

a- Detailed analysis of general and administration expense.

b- Detailed analysis of staff cost and other cost.

c- Zakat, donations and tax differences as per law No. 19 of 2000 and Zakat differences as

per Law No. 46 of 2006 from previous years.

3. Statement of provisions analysis, setting out beginning and ending balances and the

movement during the year for each individual provision.

4. Statement of provisions and reserves imposed as per bylaws and regulatory authorities.

Tax department has added a new paragraph to the executive rule number (4) concerning the

companies subject to the law which doesn’t comply to submit required Zakat declarations and its

attachments, in which the tax department will issue Zakat assessment based on the financial

statements obtained from any other sources, and it will not consider any Zakat declarations

submitted by the companies subject to the law after the issuance of Zakat assessment.

3

Executive rule

number Summary of amendments

(8)

Concerning allowed and disallowed deductions

The disallowed deductions are corrected to include Zakat computed and paid as per law No.46 of 2006.

4

Executive rule

number Summary of amendments

(10)

Concerning objection against Zakat assessment

The tax department executive rules dictate the companies to object only on the same items

rejected on Zakat assessment without raising any other new issues.

Companies that didn’t enclose the required documents with Zakat declaration as per executive

rule No (4), and Zakat assessment has been already issued based on the available information

and data, they will not have the right to object on those items that are not supported even if the

required documents have been submitted during the objection.

5

Executive rule

number Summary of amendments

(11)

Concerning appeal against Zakat assessment

The tax department executive rules dictate the companies to appeal only on the same items

that were rejected on the objection level without raising any other new issues.

6

Executive rule

number Summary of amendments

(13)

Concerning settlement procedures

Ministry of Finance gives the companies the option to pay the due amounts through

electronic means.

The tax department provided the IBAN for Zakat settlement through bank transfers as

follows:

IBAN No.(KW97 CBKU 0000 0000 0000 0004 2040 53) with Central Bank Of Kuwait

(CBK) in which the payment notice shall include the name of the company, type of settled

amount (Zakat as per declaration ,Zakat as per assessment) and the related financial year

thereon.

7

Executive rule

number Summary of amendments

(18)

Concerning benefits from tax treaties

The tax department added a new executive rule concerning how the department will deal with

Zakat paid abroad and claimed as deduction by the companies subject to the law to avoid double

payment on the same profits as per the international treaties.