Saudi Arabia Extends Tax Penalty Waiver to End of 2026

Businesses and investors in Saudi Arabia can continue to benefit from a wide tax penalty waiver that has been extended into 2026, giving companies more time to settle outstanding obligations without paying fines. The waiver runs in two stages: from 1 January to 30 June 2026 across all tax systems, followed by a further extension from 1 July to 31 December 2026.

The initiative covers penalties linked to corporate income tax (CIT), withholding tax (WHT), value-added tax (VAT), excise tax, and real estate transaction tax (RETT). Waived penalties include those for late registration, late payment, late filing of returns, VAT return adjustments, and field-inspection violations related to electronic invoicing and general VAT provisions. Eligible penalties are fully exempted, meaning taxpayers pay only the principal tax due.

Some penalties are excluded. These include fines related to tax evasion, fines that have already been paid, and penalties under Article 45 of the VAT Law. The waiver applies to returns and liabilities due on or before 30 June 2026; fines tied to returns due after that date are not covered, even if the initiative is extended further beyond 2026.

How to Benefit

To qualify, taxpayers must register with the Zakat, Tax and Customs Authority (ZATCA) in the relevant tax system, submit all outstanding returns during the initiative period, and pay the principal tax due or arrange an approved installment plan. Businesses must also avoid committing new violations during the period. There is no extra administrative fee to enter the waiver.

Registration, filing, payment, and installment requests are handled through ZATCA's electronic portal and e-services, linked to commercial registration and tax numbers. For support, businesses can reach the unified call center on 19993, available around the clock, email info@zatca.gov.sa, or use the live chat on ZATCA's official portal. The relief offers a valuable opportunity for companies to regularize their tax position and stay compliant while the market continues to grow.

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