Keeping clinic books your accountant can file VAT and zakat from

A clinic owner sees the money every day, in the drawer and on the bank statement, but the people the clinic answers to do not look at the drawer. The Zakat, Tax and Customs Authority (ZATCA) asks about the invoices that were issued and the VAT in them, about the expenses the clinic paid VAT on and wants to recover, and at the end of the year about a balance sheet that zakat is worked out from. The accountant answers those questions, but only with what the clinic has recorded.

What wears an accountant out at most clinics is not difficult arithmetic but missing records: an invoice edited instead of corrected with a credit note, an expense paid in cash with no invoice from the supplier, a card payment nobody can tie to a bill. This guide sets out what to keep, then explains why the figures differ between cash basis and accrual, then gives a month-end and a year-end routine, and finally what an accountant should and should not see in the clinic's system.

The records that should always be ready

An issued invoice is never edited or deleted; it is corrected with a credit or debit note that refers to it, as the guide to credit and debit notes explains. In Saudi Arabia invoices and notes already go through the e-invoicing requirements, so the record the accountant needs is the same record ZATCA asks for. As for how long to keep it: VAT records are kept for at least six years, longer for capital assets, and the Law of Commercial Books requires merchants and companies to keep their books and supporting documents for at least ten years — so plan on ten, and confirm the period that applies to your clinic with your accountant.

Cash basis and accrual: why the two figures never match

Cash basis asks: how much money came in this period? Accrual asks: how much did the clinic earn for services it delivered this period, paid or not? At a clinic where every patient pays at the desk on the way out, the two are almost the same. Once a clinic bills insurers the gap is large and permanent, because the insurer pays weeks or months after the visit. An example for March:

Both figures are right; they answer different questions. Cash basis tells you whether you can pay salaries and rent. Accrual is what the financial statements are usually built on, and it is closer to what the VAT return asks for: as a general rule VAT falls due at the earliest of three events, delivering the service, issuing the invoice or receiving the money, not when the insurer's transfer finally lands. That is why the accountant needs the invoices and notes issued in the period, not only a list of what was collected.

The VAT return for a clinic

The standard rate is 15%. A clinic whose annual supplies exceed SAR 40 million files monthly; below that, quarterly. The return is due by the last day of the month after the period ends: the second quarter of 2026, for example, was due on 31 July. The penalty for filing late runs from 5% to 25% of the tax that should have been declared. Clinics have a twist the accountant must watch for: private healthcare for Saudi citizens is invoiced without VAT because the State bears it, as the guide to citizen VAT on healthcare explains, so estimating VAT by multiplying revenue by 15% is wrong. For every period the accountant needs:

• Sales by VAT rate: what was charged at 15% and what was issued at zero for citizens, each in its own box.
• Credit and debit notes issued in the period, apart from the invoices, because they adjust the VAT of the period they are issued in.
• Input VAT on expenses that carry a tax invoice from a registered supplier, with that invoice's number.
• A reconciliation between the return and the books: the invoices in the system add up to what is on the return, and any difference has a written explanation.

Zakat and income tax: who pays what

The share of a clinic owned by Saudi and GCC nationals is subject to zakat; the share owned by non-Saudis is subject to income tax at 20% of taxable profit. So a clinic owned outright by a Saudi doctor pays zakat, and a clinic with a 30% foreign partner pays zakat on 70% of the zakat base and income tax on 30% of the profit. Both returns are filed within 120 days of the financial year end: the end of April for a clinic whose year ends on 31 December.

Zakat is not worked out from a month's takings, nor from the year's profit alone. It is 2.5% of the zakat base for a Hijri year and slightly more for a Gregorian year (about 2.578%, that is 2.5% times 365 over 354), and the base itself is built from the year-end balance sheet: items added and items deducted as the zakat regulation sets out. In practice the accountant needs more than the clinic's operating figures: assets such as equipment and fit-out, loans, capital and retained earnings. The clinic's day-to-day books give them an important part of that picture, but they are not the balance sheet.

Expenses and input VAT

Every expense is recorded on its day with its category, supplier, invoice number and how it was paid, and the amount including VAT with the VAT in it. VAT the clinic paid on its purchases is only recoverable against a valid tax invoice from a registered supplier, so a handwritten receipt from a shop with no VAT number is an expense with no input VAT. Rent, salaries, supplies and equipment go in separate categories, because a device bought for a hundred thousand riyals is not a month's cost but an asset the accountant depreciates over years. Paying small expenses out of the takings drawer breaks its close; a separate petty-cash box is safer, as the guide to the daily cash close explains.

A month-end routine

A year-end routine

• Close the year on one date the owner and accountant agree, and issue no invoice dated in the closed year after it.
• Count stock and equipment: what is in the store, and the devices bought during the year with their invoices, because they belong in the balance sheet the base is built from.
• Old insurer receivables: anything past ninety days is reviewed, and the accountant decides on what will not be collected.
• The full year's files, with bank statements, loans and lease contracts, well ahead of the filing deadline, not in its last week.

What an accountant should see in the clinic's system

• All of the money: invoices, notes, payments, expenses, cash closes and receivables.
• Corrects an invoice with a note rather than deleting it, and records a bank transfer that arrived late.
• Does not reverse payments or reopen a drawer: whoever checks the till should not also take money out of it unseen.
• Does not see the medical record: visits, prescriptions and results are not the accountant's work, and protecting them is the clinic's duty.

The general rule is to give each person what their job needs and nothing more, as the guide to clinic staff roles and permissions sets out. An outside accountant who works for several clinics is a stronger case for that rule than any receptionist.

How 3yadtk handles a clinic's books

In 3yadtk the clinic owner adds a member of staff with the Accountant role in Settings → Team & Access → Staff, and only the owner can appoint one, change their role or remove them; a manager cannot. An accountant sees, raises, corrects and cancels invoices with a credit note, and credit and debit notes each have their own number series tied to their invoice; they record payments, and see the patient details billing needs and insurance claims. They do not see visit records, prescriptions, results, documents or medical history, cannot reverse a payment, change a doctor's commission rate or reopen a cash close, and do not manage staff, backups or any settings beyond the tax and zakat ones on their own Settings page. They record expenses and void them with a written reason rather than deleting them: the date, the category (rent, salaries, supplies, utilities, marketing, maintenance, equipment, fees and subscriptions, other), the amount including VAT and the VAT in it, how it was paid, the vendor, and the bill or receipt number.

Under Billing → Finance the accountant sees, for any period, what was collected, the expenses, the net and the VAT on expenses, and the screen says what it shows: "Cash basis: what was collected less refunds, against recorded expenses. Amounts include VAT; the VAT you paid on expenses is shown for your accountant." A visit settled from a prepaid course is not counted as new money. Under Reports there is the daily cash report by payment method and by person, with insurers' transfers on their own line, and the list of open receivables by age, with insurers' and companies' bills chased with them rather than the patient. Finance also shows the VAT return's figures by category from the invoices and credit notes issued, profit before VAT for each branch, and an estimated zakat and income-tax provision at the rates the clinic sets. The accountant exports from their own Settings page — the owner from Settings → Data — the invoices, payments, credit-note and expense files, as Excel or CSV for any period and branch: each invoice with its amount before VAT, discount, VAT, total, what credit notes took off, what was paid and what is left; each payment with its method, amount, who took it, who reversed it and the refund reason. The activity log, which the owner and managers see, shows each person's role beside their name and everything an accountant does in words. 3yadtk does not calculate zakat on the zakat base — the provision is an estimate on a period's profit, nothing more — does not file the VAT return, the zakat declaration or income tax, and does not produce a balance sheet: it gives your accountant clean figures to start from, and the calculation and the filing stay with them.