In a significant move to support taxpayers, Saudi Arabia has announced a six-month extension of its tax amnesty initiative, now set to run until June 30, 2025. Initially slated to conclude on December 31, 2024, this extension aims to provide further relief to individuals and businesses seeking to address their tax obligations.
The program, introduced by the Zakat, Tax and Customs Authority (ZATCA) in March 2020 to mitigate the economic fallout from the COVID-19 pandemic, allows taxpayers to resolve issues related to unpaid taxes and avoid penalties under specific criteria. This initiative has been extended several times, with the most recent adjustment occurring between July 1, 2024, and December 31, 2024.
Key Features of the Tax Amnesty Extension Under the terms of this extension, taxpayers can benefit from exemptions on various unpaid fines, including: – Penalties incurred for late registration across all tax laws and regulations – Fines for delayed payments and overdue tax return submissions – Penalties connected to corrections in value-added tax (VAT) returns – Fines arising from VAT field detection violations and e-invoicing infractions specified by Article 45 of the VAT Law Moreover, this initiative also waives late-payment penalties for those on ZATCA-approved installment plans for debts accrued following the amnesty period’s conclusion.
Eligibility Criteria for Exemptions To qualify for these exemptions, taxpayers must meet specific conditions. This includes registering with ZATCA, submitting any outstanding or incorrect tax returns, and ensuring the payment of the principal amount resulting from those filings or opting for installment arrangements post-filing. Notably, taxpayers are exempt from late filing penalties for returns due before the amnesty extension’s effective date, January 1, 2025. However, fines associated with tax evasion will not be subject to this exemption.
Implications of the Extension The continued availability of this amnesty until June 30, 2025, presents a valuable opportunity for businesses and taxpayers to correct tax-related discrepancies and mitigate penalties associated with late payments. This proactive approach aims to foster compliance and enhance the overall tax environment in Saudi Arabia.
This initiative reflects Saudi Arabia’s ongoing commitment to bolstering its economy and supporting taxpayers as the nation navigates the post-pandemic recovery landscape.
