ZATCA extends the Tax Amnesty up to 30 June 2024​

On 29 December 2023, the Zakat, Tax and Customs Authority (ZATCA) announced on its website the extension of the “Cancellation of Fines and Exemption of Penalties Initiative (the “Initiative”) for another six (6) months starting from 1 January 2024 until 30 June 2024.

The ZATCA clarified that the initiative covers fines for late registration in all tax laws, late payment, late filing of returns in all tax laws, fines for correcting VAT returns, and fines for violations of VAT field control related to applying the e-invoicing regulations and other general regulations.

To take advantage of the Initiative, the following are required:

· Taxpayers should be registered in accordance with the tax law and submit all previously unsubmitted returns to ZATCA.
· Payment of all principal tax due associated with the tax returns that will be submitted or amended to accurately disclose the outstanding tax liabilities.
· Taxpayers can request an installment payment plan from ZATCA while the initiative is in effect and all due instalments are paid within the due dates specified in the ZATCA-approved instalment plan.

It is also important to note that the initiative excludes penalties related to tax evasion violations and fines paid before the initiative’s effective date.

The ZATCA also invited taxpayers to view the simplified guideline it issued in this regard outlining the types of penalties covered, conditions for exemption, steps for installment payment, and details on field control violations (link here).

Further, the ZATCA clarified in the Guidelines that the taxpayer shall be exempted from late filing fines on tax returns which must be filed to ZATCA before the effective date of the Initiative’s extension on 1 January 2024 for all taxes (e.g., November 2023 VAT and WHT returns or Q3-2023 VAT returns).

Accordingly, taxpayers are enjoined to take benefit from the Initiative within the specified period. We shall be pleased to assist taxpayers who wish to avail of the tax amnesty benefit by reviewing their tax filing position and how best to rectify it from compliance perspective.