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08 July 2024

Saudi Arabia further extends tax amnesty initiative until 31 December 2024

  • Saudi Arabia has further extended the Cancellation of Fines and Exemption of Financial Penalties tax amnesty initiative to the end of the calendar year.
  • The tax amnesty initiative had previously been extended until 30 June 2024 and has been further extended by another six months, providing relief to taxpayers who meet the requirements.
 

Executive summary

On 30 June 2024, Saudi Arabia's Ministry of Finance issued Resolution No.1352 dated 28/11/1445AH extending the tax amnesty initiative Cancellation of Fines and Exemption of Financial Penalties, from 1 July 2024 to 31 December 2024, based on Royal Order No. (60699) dated 26/9/1443 AH. Saudi Arabia's Zakat, Tax and Customs Authority (ZATCA) announced this statement of the Minister of Finance on its official website.

The initiative, previously extended from 1 January 2024 through 30 June 2024, has been further extended for another six months until the end of 2024 to continue to provide relief to taxpayers and businesses who meet the qualifying requirements. The ZATCA had previously published a Simplified Guide — Cancellation of Fines and Exemption of Financial Penalties to help taxpayers understand the details of the initiative.

Detailed discussion

Background

In March 2020, the ZATCA had introduced the tax amnesty initiative to relive the impact of the COVID-19 pandemic. This initiative has since been extended multiple times, with the most recent extension from 1 January to 30 June 2024.

For further information on the previous Saudi tax amnesty program, please refer to EY Global Tax Alert, Saudi Arabia further extends tax amnesty initiative through 30 June 2024, dated 3 January 2024.

Highlights of the tax amnesty extension

Exemption from unpaid fines is provided, including:

  • Fines resulting from late registration under all tax laws and regulations
  • Delayed payment fines and overdue tax return submission fines under all tax laws and regulations
  • Value-added tax (VAT) return correction penalty
  • Fines for violations of VAT field detection and e-invoicing, based on Article 45 of the VAT Law

Exemption is also provided from late-payment fines in the ZATCA-approved installment plan for payments due after the end of the amnesty initiative.

The exemption shall be subject to specific conditions, including:

  • Taxpayers must be registered with the ZATCA to benefit from the exemption.
  • Taxpayers should file all pending or incorrect tax returns and pay the resulting principal amount or apply for instalments after filing.
  • Taxpayers shall not be exempted from fines resulting from tax evasion violations.

Implications

The further extension of the amnesty initiative until 31 December 2024 provides another opportunity for businesses and taxpayers to rectify any discrepancies or errors in their tax records and avoid late fines.

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Contact Information

For additional information concerning this Alert, please contact:

Ernst & Young Professional Services (Professional LLC), Riyadh

Ernst & Young Professional Services (Professional LLC), Jeddah

Ernst & Young Professional Services (Professional LLC), Al Khobar

EY Consulting LLC, Dubai

Ernst & Young — Middle East, Bahrain

Ernst & Young LLP (United States), Middle East Tax Desk, New York

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor

Document ID: 2024-1307

 
 

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