Saudi Arabia: Penalty waiver for all taxes, including VAT and excise tax extended until May 2023 (COVID-19)

The amnesty initiative that waives penalties on all taxes is extended until end of May 2023

Amnesty initiative that waives penalties on all taxes is extended until end of May 2023

The Zakat, Tax and Customs Authority (ZATCA)—as part of its efforts to mitigate the effect of the coronavirus (COVID-19) pandemic—again extended the amnesty initiative that waives penalties on all taxes, including income tax, withholding tax, value added tax (VAT), excise tax and real estate transaction tax, until the end of May 2023 (previously set to close 30 November 2022). Read TaxNewsFlash

Fines to which the amnesty initiative applies:

  • Fines resulting from the late registration in all taxes
  • Payment delay fines and fines related to delay in filing tax returns
  • Fines resulting from amendment of VAT returns
  • Fines resulting from field detection of violations of VAT and e-invoicing regulations

The amnesty initiative excludes the following fines:

  • Fines paid before the effective date of the initiative
  • Fines resulting from tax evasion violations
  • Fines associated with returns due after 30 November 2022

Mandatory requirements

To receive a benefit from this initiative, ZATCA issued the following mandatory requirements:

  • The registration of businesses with the ZATCA for the applicable taxes
  • Submission of outstanding returns along with payment of due tax liability

KPMG observation

It is important to note that taxpayers have the right to make payment of due taxes on installments according to an installment plan approved by ZATCA, and the taxpayers will benefit from waiving the late payment penalties on installments due after end of May 2023. This is a welcome change in comparison to earlier amnesty programs when the delay fine was applicable on the installments due after the end of the amnesty period.  

For more information, contact a KPMG tax professional:

Philippe Stephanny |


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