Saudi Arabia extends tax penalty waiver scheme until end-2026

Dubai: Saudi Arabia has extended its initiative waiving selected tax fines and financial penalties for taxpayers by a further six months, giving businesses and individuals until December 31 to regularise their tax affairs.

The Zakat, Tax and Customs Authority (ZATCA) said the extension, approved by the Minister of Finance, will take effect from July 1, 2026, and applies to taxpayers covered by all tax systems.

Under the initiative, taxpayers may be exempt from fines for late tax registration, late payment, delayed submission of tax returns and penalties related to amendments to value added tax (VAT) returns.

To qualify, taxpayers must be registered with ZATCA, submit all outstanding tax returns and pay the full principal amount of any tax liabilities. They may also apply for an instalment plan during the initiative's validity period, provided payments are made according to the schedule approved by the authority.

ZATCA said the initiative does not cover penalties arising from tax evasion, sanctions imposed under Article 45 of the VAT Law, fines paid before the initiative took effect, or penalties linked to tax returns due after June 30, 2026.

The authority urged eligible taxpayers to take advantage of the extended scheme before it expires at the end of the year and said detailed guidance on eligibility, covered penalties and payment procedures is available on its website.