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 ZATCA Exempts Its Taxpayers from Fines and Financial Penalties to Reduce the Consequences of the COVID-19 Pandemic on Businesses

The Zakat, Tax and Customs Authority (ZATCA) has announced the relaunch of the "canceling fines and exemption from financial penalties for all taxpayers" initiative for six months, starting today, Wednesday, June 1, 2022, and ending November 30, 2022, to reduce the economic effects resulting from the COVID-19 pandemic on businesses.

The fines covered by the exemption decision, according to the Authority, include fines for late registration in all tax systems, late payment, late filing of returns fines in all tax systems, and fines to correct VAT returns, as well as fines for violations of VAT field control related to applying the e-invoicing regulations and other general regulations.

The Authority has also stated that in order to benefit from the initiative, it is necessary to register for VAT for non-registered individuals who had to register earlier, and to submit all due returns that have not been previously submitted to the Authority, along with the disclosure of all taxes that are not clearly disclosed, and the payment of the full tax debt related to the declarations that will be submitted or amended to clearly disclose the tax obligations due, with the possibility to request an installment, provided that the request is submitted and approved by the Authority during the initiative, and to pay all due installments on their due time according to the ZATCA-approved installment plan.

The Authority has invited taxpayers to view the details of the initiative through the simplified guideline available on its website, which includes a detailed explanation of the most important aspects of the decision, such as the types of penalties that are included in the decision, clarifying the conditions for benefiting from the exempt fines and the steps for installment financial dues, as well as introducing the field control violations. 

The Authority has confirmed that the initiative does not include penalties related to tax evasion violations, fines paid before the initiative's effective date, and late payment fines related to the tax included in the installment plan that is due after the initiative's deadline of November 30, 2022.

The Authority has urged all taxpayers to benefit from the initiative during the allotted time, which ends in November 2022, and has also urged them to contact it if they have any inquiries via the unified call center number (19993), which is works 24/7, or through the Twitter account (@Zatca Care), or e-mail (info@zatca.gov.sa), or instant conversations through the ZATCA's website (zatca.gov.sa​).

The cancellation of fines and exemption from financial penalties is a part of the Authority's previous initiatives, which were implemented to reduce the economic and financial impacts of the COVID-19 pandemic and its repercussions.

It's worth mentioning that the Authority has reclassified the VAT violations and penalties associated with field violations that result from the taxpayer's failure to comply with the duties and tax obligations at the beginning of this year, so that all penalties for field violations begin with alerting the establishment and informing the taxpayer before imposing any financial fines if the violation is committed for the first time.