Saudi Arabia – United States Tax Treaty
The Saudi Arabia-United States tax treaty caps withholding on dividends at 5%, and interest at 5%. Royalties are taxed at a uniform 10% across all categories. Private pensions are taxable only in the country of residence, with no withholding at source. This is one of 23 active treaties in Saudi Arabia's network and one of 64 in United States's. The general dividend rate of 5% compares to a median of 5% across Saudi Arabia's network and 15% across United States's.
Verified data
ZATCA Tax Treaty Network (zatca.gov.sa) (Treaty list verified April 2026. Rates from individual treaty texts (Articles 10-12). Saudi Arabia charges 5% WHT on dividends and interest, 15% on royalties.)
Withholding Rate Summary
Source: Saudi Arabia Treaty Reference| Income Type | Treaty Rate | Statutory Rate (Saudi Arabia) |
|---|---|---|
| Dividends (general) Portfolio investors | 5% | 5% |
| Dividends (qualified) Beneficial owner is a company holding >= 10% of voting stock | 5% | 5% |
| Interest Bank interest, bonds, loans | 5% | 5% |
| Royalties (avg) Patents, copyright, know-how, film/TV | 10% | — |
| Pensions Private pension distributions | 0% | — |
| Social Security Government social security benefits | 0% | — |
“Treaty Rate” is the maximum withholding permitted under this treaty. The actual effective rate may be lower if domestic law provides a more favorable rate independently. “Statutory Rate (Saudi Arabia)” shows the rate that applies when no treaty benefit is claimed. Qualified dividend rate requires: Beneficial owner is a company holding >= 10% of voting stock.
Dividends
The general dividend rate of 5% applies to portfolio investors. A reduced rate of 5% is available when beneficial owner is a company holding >= 10% of voting stock. Without the treaty, the statutory withholding rate on dividends is 5%.
Source: Saudi Arabia Treaty Reference
Interest
Interest payments (bank interest, bonds, loans) are subject to 5% withholding under this treaty, compared to the 5% statutory rate. This represents a no reduction from the statutory rate.
Source: Saudi Arabia Treaty Reference
Royalties
Royalty withholding rates vary by the type of intellectual property. This treaty distinguishes 4 categories, with rates ranging from 10% to 10%.
Source: Saudi Arabia Treaty Reference
Pensions & Social Security
Private pension distributions are taxable only in the country of residence, with no withholding at source. Government social security benefits are exempt from source-country withholding.
Source: Saudi Arabia Treaty Reference
Comparative Context
🇸🇦Saudi Arabia's Network
Among Saudi Arabia's 23 active treaty partners, the 5% general dividend rate ranks 16th (median: 5%).
| Partner | Rate |
|---|---|
| Poland | 5% |
| Russia | 5% |
| Singapore | 5% |
| United States (this treaty) | 5% |
| South Africa | 5% |
| Italy | 10% |
| Japan | 10% |
🇺🇸United States's Network
Among United States's 64 active treaty partners, the 5% general dividend rate ranks 5th (median: 15%).
| Partner | Rate |
|---|---|
| Brazil | 0% |
| Hong Kong | 0% |
| Malaysia | 0% |
| Saudi Arabia (this treaty) | 5% |
| Bulgaria | 10% |
| China | 10% |
| Japan | 10% |