We, hereby announce to all customers of Saudi Home Loans Company (the company) that a recent laws and regulations were issued in the Kingdom of Saudi Arabia for the application of 5% VAT effective 1st Jan 2018. This law will apply on loan financing applications, and also on the lease financing contracts signed or to be signed between the company and its customers regarding the principal component of the monthly installments paid to the company. Whereas, the VAT will be applied effective 1st Jan 2018, the company will collect the VAT from the loans applications amounts and fees; in addition the VAT will be collected from existing customers who signed lease financing contract, on the principal component of the monthly installments paid to the company. Therefore, the company added a new Clause and addendum to all existing agreements and contracts signed between the company and services and goods suppliers as hereunder:
“The company will collect the VAT amount from customers / obligors on the principal component of the monthly installment as stated in the payment schedule of which the customer may request a copy available at the company offices”
Except as announced above, all terms of the lease financing contracts are not subject to any changes or amendments and shall be in full force and effect in all aspects.