Models the effective Zakat / CIT / WHT leakage on dividends flowing from KSA Targets up to APHL, under the IBL + IFBL funding combo, across GCC vs non-GCC ownership and future dilution. Compares Option 1 (KSA HoldCo), Option 2 (UAE QFZP), and Option 3 (Saudi OpCo — our email), and solves for the funding mix that minimises total tax+Zakat.
Working model, not a tax opinion. Mechanics: Saudi ITL Art. 7(3) (intra-KSA dividend CIT-exempt) · Art. 9(2) interest-deductibility cap · Art. 68 / DTT Art. 10 (5% gross outbound WHT) · Zakat 2.5% on GCC-attributable Zakat base · CIT 20% on non-GCC-attributable net profit · UAE FDL 47 Art. 34 ALP imputed interest (neutralised if QFZP). Figures depend on your inputs and on GT's still-pending beneficial-ownership analysis.
EBT pool generated at the KSA Target level before any KSA tax, available to dividend up.
Share of post-tax profit dividended UP to APHL. The rest is retained in-KSA and recycled into the next acquisition. Below 100% is where the options diverge — Opt 1/3 recycle WHT-free, Opt 2 pays 5% WHT on every cross even on recycled cash.
APHL slice (ultimately Amr CA + Karim EG, both non-GCC) → CIT 20%. Remainder = Saudi/GCC SOCPA partners → Zakat. SOCPA M/59 floor ≥25% licensed.
+ adds GCC capital (shrinks non-GCC slice → more Zakat, less CIT). − concentrates non-GCC. Applied to the slice above.
Akram (Saudi/GCC) holds 7% of APHL, diluting Amr 60→55.8% & Karim 40→37.2%. The cascade looks through APHL: this slice is Zakat, not CIT. Remainder = Amr CA + Karim EG → CIT.
Upfront deployment (UAE → KSA)
The acquisition capital sent from APHL (where the cash sits today, UAE) down to the KSA OpCo/HoldCo. This is the shareholder facility — split below into IBL vs IFBL. Funds the acquisitions.
IBL portion. Generates a CIT-deductible interest shield (capped by Art. 9(2)); interest income lands at APHL (0% if QFZP). Remainder = IFBL (Qard Hasan).
Average all-in cost to acquire one target firm. Drives the “deals fundable” readout from deployed + recycled cash.
Probability ZATCA/TP recharacterises Qard Hasan as equity → added to Zakat base (no cap), no interest deduction. Expected-value drag shown.