Introduction: What Is the First Home Tax Exemption Certificate? Owning a first home is one of the most important aspirations for every Saudi citizen. Recognizing the profound impact homeownership has on family stability and social wellbeing, the Custodian of the Two Holy Mosques launched in 1439H (2017) the First Home Tax Exemption Initiative — one of the most significant government programs aligned with Saudi Vision 2030's goal of increasing homeownership rates among citizens. The First Home Tax Exemption Certificate is an official document issued by the Ministry of Municipal, Rural Affairs and Housing in collaboration with the Zakat, Tax and Customs Authority (ZATCA). It certifies that the applicant has never previously owned any residential property registered in their name in the Kingdom of Saudi Arabia, thereby qualifying them for exemption from the 5% Real Estate Transaction Tax when purchasing their first home. In essence, the government pays this tax on behalf of the citizen for properties valued up to 1,000,000 SAR, translating to potential savings of up to 50,000 SAR — a substantial amount that significantly reduces the overall purchase cost. Who Benefits from the Tax Exemption Certificate? The tax exemption certificate is not available to everyone indiscriminately. Authorities have established clear criteria to ensure government support reaches those who truly need it. The primary beneficiaries are Saudi citizens purchasing their first home who have never previously owned any residential unit registered in their name — whether an apartment, villa, duplex, townhouse, or any other residential unit within approved housing projects. This includes young men and women planning for marriage who wish to establish their family life in an independent home, young families looking to transition from renting to owning, and citizens of all age groups who have not yet had the opportunity to own their own home. The initiative does not discriminate based on gender or age, as long as the fundamental condition is met — no previously registered residential property in the applicant's name. Requirements for Obtaining the First Home Tax Exemption Certificate The Ministry of Housing and ZATCA have established a set of essential conditions that must be met by both the applicant and the property being purchased for the exemption request to be approved. Applicant Requirements The foremost requirement is Saudi nationality — the initiative is exclusively for Saudi citizens. Second, the property must be the applicant's first home, meaning they have never owned any residential unit registered in their name anywhere in the Kingdom. This is verified electronically through integration with relevant authorities such as the Ministry of Justice and the Real Estate Registry. Third, the applicant must not have any current or previous housing loans, whether from commercial banks or the Real Estate Development Fund, ensuring the beneficiary has not received prior housing support. Property Requirements The property must be designated exclusively for residential purposes, not commercial or investment use. Its price must not exceed 1,000,000 SAR for full exemption coverage. If the property value exceeds this threshold, the exemption applies only to the first million riyals, with the buyer responsible for the 5% tax on the remaining amount. For example, for a 1,200,000 SAR property, the government covers the tax on the first million (50,000 SAR), while the buyer pays tax on the remaining 200,000 SAR (10,000 SAR). The exemption covers all types of residential units: apartments, villas, duplexes, townhouses, and units within approved residential projects. Maximum Exemption Amount and Calculation Method The maximum property value covered by full exemption is 1,000,000 SAR. Since the Real Estate Transaction Tax rate is 5%, the maximum amount the government will cover on behalf of the citizen is 50,000 SAR. This represents a meaningful difference in the overall home purchase budget, especially for young families and lower-income households. Practical examples: A 700,000 SAR home incurs a 35,000 SAR tax — fully covered by the government. An 850,000 SAR home has a 42,500 SAR tax — also fully covered. A 1,000,000 SAR home means exactly 50,000 SAR covered by the government. However, a 1,500,000 SAR home means the government covers 50,000 SAR (tax on the first million), while the citizen pays 25,000 SAR (tax on the remaining 500,000 SAR). Step-by-Step Guide to Issuing the Tax Exemption Certificate via Sakani The issuance process is fully digitized in 2026 and can be completed from home without visiting any government office. Step 1: Access the Sakani Portal Visit the official Sakani website (sakani.sa) or download the Sakani mobile app. Navigate to the "Your First Home Tax-Free" service or access the First Home Tax Exemption portal directly at vat.sakani.sa. Step 2: Log In or Create an Account Log in using National Single Sign-On (Nafath) credentials with your national ID number and password. New users can easily create an account by following the registration steps on the platform. Step 3: Complete the Form and Declaration After successful login, add your email address and specify your monthly income level. An electronic declaration will appear confirming this is your first home and you have never owned any registered residential property. Read carefully and approve. Step 4: Automated Verification and Review The system automatically verifies applicant data through electronic integration with relevant authorities including the Ministry of Justice, Real Estate Registry, and Real Estate Development Fund to confirm no registered property or previous housing loans. Step 5: Certificate Issuance and Printing Upon meeting all requirements, a page displays your personal information with a download button for the tax exemption certificate. Download and print it — this is the document you will present to the seller or developer when completing the purchase. Step 6: Present Certificate to Seller and Complete Transaction Present the printed certificate to the seller, who completes the sale without collecting tax from the buyer. The system automatically integrates with ZATCA's portal to apply the exemption immediately during the electronic property transfer at the notary. Required Documents for the Exemption Process To ensure a smooth process, prepare the following documents in advance: a valid copy of the national ID, the tax exemption certificate issued from Sakani, a copy of the sale contract or purchase agreement, a certificate from the Real Estate Registry confirming no previous property ownership, and proof of no current or previous housing loans from banks or the Real Estate Development Fund. Having these documents ready saves time and prevents transaction delays. Benefits of the Tax Exemption Certificate: Impact on Citizens and the Market The benefits extend far beyond direct financial savings. For citizens, saving up to 50,000 SAR makes a real difference — especially for young families who can use these funds for furnishing their new home or covering moving expenses. The initiative also eases the burden of down payments and facilitates confident purchasing decisions. For the real estate market, the initiative has stimulated demand for residential units priced up to one million riyals, encouraging developers to offer diverse housing projects suited to this segment. It has also contributed to raising homeownership rates in line with Vision 2030's target of 70% ownership by the end of the decade. Socially, homeownership enhances family stability and reduces the burden of high rental costs on household budgets. How to Claim a Refund If Tax Was Already Paid In some cases, citizens may have purchased their first home and paid the transaction tax before learning about this initiative. The Ministry of Housing provides a tax refund service for up to 50,000 SAR. Submit a refund request electronically through the First Home Tax Exemption portal by selecting "Real Estate Transaction Tax Request" and attaching required documents: the tax exemption certificate, a copy of the deed in the new owner's name, and the tax payment receipt. After review and approval, the refund is transferred to the citizen's bank account. Common Mistakes to Avoid When Applying Based on practical experience, several common mistakes should be avoided. First, failing to obtain the certificate before completing the purchase — the certificate must be secured first and presented to the seller before signing the contract. Second, purchasing a commercial property assuming it qualifies for exemption — only residential properties are covered. Third, neglecting to verify that no housing loan is registered in the applicant's name, as even fully repaid loans may appear in records and cause rejection unless updated with the lending institution. Fourth, not printing the certificate and providing the physical copy to the seller or relevant authority. Other Real Estate Transaction Tax Exemption Cases Beyond the first home exemption, other real estate transactions qualify for full tax exemption under Saudi law. These include inheritance transfers from deceased to legal heirs, gifts to relatives up to the third degree under specified conditions, transfers to government entities, transfers to licensed charitable endowments and non-profit organizations, and property contributions as in-kind capital in joint-stock companies at establishment with conditions on share disposal periods. Understanding these cases helps citizens with proper real estate planning and informed decision-making. Frequently Asked Questions About the First Home Tax Exemption Certificate Can Saudi women obtain the tax exemption certificate? Yes, absolutely. The initiative is available to all Saudi citizens regardless of gender, provided all required conditions are met. Does the exemption cover residential land? The exemption covers ready residential units such as apartments and villas. Residential land may have different provisions, and it is recommended to check the latest updates via Sakani or ZATCA. How long does certificate issuance take? Typically, the certificate is issued immediately after conditions are met and automated verification is complete — the process may take just a few minutes if no issues are found with the applicant's data. What if the property value exceeds one million riyals? The exemption applies only to the first million riyals of the property value (saving 50,000 SAR), and the buyer pays 5% tax on the amount exceeding one million. Can I claim a refund if I paid tax before obtaining the certificate? Yes, you can submit a refund request through the First Home Tax Exemption portal, provided you attach the required documents and the property qualifies for exemption. Does the certificate have an expiration date? It is recommended to complete the purchase as soon as possible after certificate issuance. Contact the Ministry of Housing to verify any updates regarding validity periods. Final Thoughts and Advice The First Home Tax Exemption Certificate is a golden opportunity that every Saudi citizen planning to purchase their first home should take advantage of. Potential savings of up to 50,000 SAR is not insignificant, and the process is now fully digital and streamlined. We advise every prospective buyer to obtain the certificate first before entering any financial commitment, ensure all conditions are met, and keep a printed copy of the certificate for presentation when needed. Raghdan Real Estate Platform provides you with search and evaluation tools to help you make the best decision when purchasing your first home, matching your budget and needs.

Tags: tax exemption certificate, first home Saudi Arabia, real estate transaction tax, Ministry of Housing, Sakani platform, first home ownership, tax exemption, Vision 2030, ZATCA, Saudi real estate market 2026