Saudi Arabia’s ZATCA Extends Tax Penalty Waiver Until June 30, 2026

The Zakat, Tax and Customs Authority (ZATCA) in Saudi Arabia has officially extended its tax amnesty initiative, waiving fines and financial penalties for qualifying businesses until June 30, 2026, providing a critical grace period for companies to regularize their tax positions without facing immediate financial consequences. This extension covers penalties related to late registrations, delayed payments, late filing of tax returns, VAT return corrections, and violations of e-invoicing regulations across corporate income tax, withholding tax, VAT, excise tax, and real estate transaction tax. To benefit from the initiative, taxpayers must be registered with ZATCA, submit all outstanding tax returns, and settle their principal tax debts or have an approved installment plan in place. However, the waiver explicitly excludes fines for deliberate tax evasion, penalties already paid before the initiative began, and fines associated with tax returns due after December 31, 2025. This decision reflects ZATCA's commitment to supporting a smooth transition for taxpayers as the kingdom progresses through its phased rollout of mandatory electronic invoicing, offering businesses a final opportunity to correct historical infractions before standard compounding fines are algorithmically enforced after the deadline.