Tax Amnesty ALERT
The Zakat, Tax and Customs Authority (ZATCA) has announced the issuance of a resolution by the Minister of Finance extending the validity of the financial penalties waiver initiative. The initiative aims to support taxpayers by exempting them from various penalties under all applicable tax laws, effective from 1 July 2025 until 31 December 2025.
- The initiative has been extended for an additional 6 months, effective from 1 July 2025 to 31 December 2025.
- The initiative offers a waiver of financial penalties, including those related to late registration, late payment, late filing of returns, incorrect VAT return amendments, and Penalties for field inspection violations related to electronic invoicing provisions and other general VAT provisions.
- To benefit from the waiver, the taxpayer must be registered in the relevant tax system, and settle all principal tax liabilities in full, either through a lump-sum payment or via an approved installment plan.
- The waiver does not apply to penalties related to tax evasion, or to any penalties that were settled before the start of this initiative period.
- Penalties related to returns that are required to be submitted to the Authority after 30 June 2025 are not included in the waiver.
The Takeaway
Businesses are encouraged to verify their tax registrations and conduct a thorough tax health check to identify and resolve any compliance issues. Prompt correction of past errors and settlement of outstanding liabilities will ensure maximum benefit from the penalty waiver. All corrective measures and payments must be completed by 31 December 2025 to take full advantage of this opportunity.
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