- Extension Announcement: On June 27, 2025, Saudi Arabia’s Zakat, Tax and Customs Authority (ZATCA) announced a six-month extension of the tax amnesty initiative until December 31, 2025, providing relief to eligible taxpayers.
- Exemption Details: The initiative allows exemptions from unpaid fines related to late registration, delayed payments, overdue tax returns, and VAT return correction penalties, while taxpayers must meet specific conditions to qualify.
- Eligibility Requirements: To be eligible for exemptions, taxpayers must register with ZATCA, file pending tax returns, and pay the principal amount owed; fines for tax evasion are not exempted.
Source EY
- Extension Announcement: On June 27, 2025, the Zakat, Tax, and Customs Authority (ZATCA) extended the “Cancellation of Fines and Exemption of Financial Penalties” initiative until December 31, 2025, providing additional relief to eligible taxpayers.
- Applicability and Exemptions: The initiative covers penalties related to various taxes, including corporate income tax, VAT, and excise tax, while excluding fines for tax evasion, fines paid before the initiative’s effective date, and fines associated with tax returns due after June 30, 2025.
- Mandatory Requirements: To benefit from the amnesty, taxpayers must register with ZATCA, submit overdue tax returns, and pay the associated tax liabilities or apply for an approved installment plan before the amnesty expires, with the possibility of waiving late payment penalties for installments due after December 31, 2025.
Source: KPMG
Saudi Arabia Extends Tax Penalty Exemption to 2025
- Extension of the Initiative: The Saudi Arabia Zakat, Tax and Customs Authority (ZATCA) has extended the Cancellation of Fines and Exemption of Financial Penalties initiative until December 31, 2025. Originally aimed at alleviating the economic impact of COVID-19, this initiative has been extended multiple times to help businesses manage their tax obligations.
- Eligible Violations and Conditions: Taxable persons may be exempt from penalties related to late registration, delayed payments, overdue tax return submissions, and specific VAT-related fines. However, they must comply with certain conditions, such as registering with ZATCA, filing any pending or corrected tax returns, and paying the principal tax amount or applying for installment plans.
- Guidance for Taxpayers: ZATCA has released a simplified guide to assist taxpayers in understanding the eligibility criteria and conditions for exemption. This guide includes examples and clarifies which tax violations are covered, helping businesses navigate the compliance process effectively.
Source vatabout
