Saudi Arabia extends tax penalty waiver initiative until December 2025

Dubai: Saudi Arabia’s Zakat, Tax, and Customs Authority (ZTCA) announced on Saturday that the Ministry of Finance has approved a six-month extension of its tax penalty waiver initiative, offering relief to taxpayers across the Kingdom.

The extended grace period will run from July 1 to December 31, 2025, and applies to all tax laws currently in effect. The initiative exempts taxpayers from a wide range of penalties, including those related to late registration, delayed payments, and late filing of returns.

 It also covers fines associated with correcting VAT returns, electronic invoicing violations, and other VAT-related infractions. In order to qualify, taxpayers must fulfill several conditions, including meeting the authority’s registration requirements, submitting any outstanding tax returns, and fully disclosing and paying their principal tax liabilities.

Taxpayers may also apply for installment plans, provided requests are made within the initiative’s validity period and payments are made on time in accordance with the approved schedule.

The ZTCA clarified that the extension does not apply to penalties already paid before the initiative’s start date, violations tied to tax evasion, or any fines related to tax obligations incurred after June 30, 2025.

The Authority encouraged taxpayers to review the initiative’s detailed guide, available on the ZTCA website, which includes explanations of covered violations, conditions for exemption eligibility, and examples of field inspection fines that qualify for the programme.

-- Huda Ata is an independent writer based in the UAE