Al-Qassim Investment Holding Company (JACO) announced today significant developments regarding its zakat position, as the company received, through its zakat advisor, the official zakat assessments issued by the Zakat, Tax and Customs Authority, pertaining to the fiscal years 2021 and 2022. These new assessments were based on the amended zakat collection regulations for the year 1445 AH, resulting in significant financial savings for the company.
In its announcement, the company explained that the total amount of zakat due, according to the new calculations, is SAR 5.34 million. This figure is significantly lower than the previous estimate of SAR 9.74 million under the old regulations. As a result, the company achieved a financial saving of SAR 4.39 million, which will be accounted for in future accounting periods.
Financial impact and timing of reversal
Jaco's management confirmed that this decrease in zakat liabilities will have a direct and positive impact on the company's financial statements. This financial effect is expected to be reflected in the results for the fiscal year 2025. It is worth noting that the company had previously adopted a conservative financial policy, establishing sufficient provisions to cover potential zakat differences, reflecting the company's sound financial planning and its ability to manage regulatory risks.
Context of Zakat amendments in the Kingdom
This announcement comes amidst the regulatory transformations taking place in the financial and tax environment of the Kingdom of Saudi Arabia. The Zakat, Tax and Customs Authority is continuously updating zakat collection regulations to ensure fairness and transparency, and to simplify procedures for taxpayers. Regulation 1445 AH is one of the steps that has contributed to clarifying the mechanism for calculating the zakat base for many listed companies, which in some cases has led to a reduction in financial burdens as a result of reclassifying certain items or modifying calculation methods.
About Al Qassim Holding Company (JACO)
Al-Qassim Investment Holding Company (JACO) is one of the long-established companies in the Saudi market, founded to serve the agricultural and investment sectors in the Al-Qassim region and the Kingdom as a whole. The company operates in diverse fields, including investment in agricultural, livestock, and industrial projects, as well as real estate. This financial surplus supports the company's liquidity, potentially granting it greater flexibility in directing its resources towards new investment opportunities or strengthening its financial position. This is something shareholders typically anticipate as a positive indicator that reinforces their confidence in the stock's performance and the company's future.
