Extension of waiver of penalties for tax filing and payment

Extension of waiver of penalties for tax filing

A Ministerial Resolution released on 21 January 2021, announced the extension of the waiver of penalties



As part of the effort to mitigate the impact of the COVID-19 pandemic on the economic activities of the Kingdom, the Minister of Finance announced, through Ministerial Resolution no. 2303 (“MR”) released on 21 January 2021, the extension of the waiver of penalties for all late tax filings and payments until June 2021.

The resolution, which came into effect on the day of its release, outlines new regressive tax penalty waiver rates. Penalties will be waived at different rates based on the timing of payment of the tax liability due to the General Authority of Zakat and Tax (GAZT).

In detail

New tax penalties waiver mechanism

The relief is applicable to penalties arising from late filing of returns and late payment of taxes that were due before the effective date of this MR. Penalties arising from assessments or reassessments of these returns and payments (i.e. due before the date of this MR) are also part of this initiative.

The relief is limited to tax penalties related to late payment, late filing, and VAT declaration amendments. To benefit from this relief, taxpayers must pay the tax liability in full. The percentage of tax penalty waived is directly linked to the date of payment of the tax liability as detailed in the table below:

Payment date

Percentage of penalty waiver

Payment in full before 21 Jan 2021


Between January and end of March 2021


Between April and end of May 2021


By June 2021


Exclusions from amnesty

The resolution made clear that the tax penalty waiver does not include a waiver of penalties incurred due to tax evasion. The penalty relief is not applicable to penalties other than those mentioned in this MR (listed above). In addition, tax penalties that have been paid to GAZT before the release of this MR will not be covered under this initiative.

Get in Touch

Riyadh Office

Wadih Abu Nasr

Head of Tax, Saudi Levant Cluster

E: wabunasr@kpmg.com

Nick Soverall

Senior Director, Head of Indirect Tax

E: nsoverall@kpmg.com

Peter Bourke

Senior Director, M&A/ Int’l Tax

E: peterbourke@kpmg.com

Mohamed Araji

Senior Director, FS/ Tax Reimagined

E: maraji@kpmg.com

Ali Sainudheen

Senior Director, Domestic Tax

E: asainudheen@kpmg.com

Oleg Shmal

Director, Indirect Tax

E: oshmal@kpmg.com

Saber Al Zawaideh

Director,  Domestic Tax

E: salzawaideh@kpmg.com

Faisal Tanvir

Director, Domestic Tax

E: FTanvir@kpmg.com

Jeddah Office

Mohamed ElSwefy

Senior Director, Family Office & Private Clients

E: mohamedelswefy@kpmg.com

Salam Eido

Director, Indirect Tax

E: seido@kpmg.com

Muhammad Masood

Director, Domestic Tax

E: muhammadmasood@kpmg.com


Khobar Office

Tareq Al Sunaid

Partner, Head of Domestic Tax

E: talsunaid@kpmg.com

Mohammad Kamran Sial

Senior Director, Domestic Tax

E: ksial@kpmg.com

Anil Bahl

Director, Indirect Tax

E: anilbahl@kpmg.com

Mohamed Gouda

Director, Domestic Tax

E: mohamedgouda@kpmg.com


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