In brief
On 29 June 2026, the Zakat, Tax and Customs Authority (ZATCA) by adopting the decision of the Minister of Finance, has announced further extension of the fines and financial penalties waiver initiative and made this available for taxpayers who wish to submit a voluntary disclosure through their returns and pay the taxes due.
The announcement, published on the official ZATCA website, can be accessed here.
The types of taxes included in this initiative are Excise Tax, Value Added Tax, Real Estate Transaction Tax, Withholding Tax and Corporate Income Tax.
This initiative has been extended for an additional six-months period, commencing on 1 July 2026, and concluding on 31 December 2026. This extension follows the tax amnesty program introduced on 1 June 2022, and applies to fines for returns due that must be submitted upto 30 June 2026.
In detail
ZATCA confirmed that the fines included under this initiative include the following:
- Late Registration
- Late Payment
- Late Filing
- Amendment/correction of VAT declaration
- Other financial fines imposed under Article 45 of the VAT Law and examples include violations of the VAT field detection and E-invoicing
In order to benefit from the initiative, taxpayers must:
- Apply for registration (where required) and discharge their prescribed obligations as per the respective tax legislation
- Submit the outstanding tax returns
- Pay all outstanding tax dues or submit a request for an installment plan, which needs to be approved by ZATCA
It is important to note that the initiative does not cover penalties for tax evasion violations paid before the effective date.
ZATCA issued a simplified guide explaining the types of fines/penalties that will be covered with illustrative examples which can be accessed through the following links:
Please note that the guideline specifically provide that in case the initiative would be extended beyond 31 December 2026, any future extension will exclude penalties for returns due to ZATCA after 30 June 2026.
Key takeaways
The current initiative provides another opportunity for taxpayers to enjoy a penalty free discharge of the tax obligations and rectification of the historical tax positions to ensure compliance with the KSA tax legislations.
Extension in the timelines of tax amnesty until 31 December 2026
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Jochem Rossel
Tax & Legal Services Leader, PwC Middle East
Mohammed Al-Obaidi
Zakat and Tax Leader, PwC Middle East
Yaseen AbuAlkheer
Partner, Zakat and Tax, PwC Middle East
Chadi Abou Chakra
Partner, ME Indirect Tax Network lead, Tax & Legal Services, PwC Middle East
Guido Lubbers
ITX Partner | TLS Middle East Consumer Markets leader, PwC Middle East
Fayez Aldebs
Partner, Zakat and Tax, PwC Middle East
Mohamed Harby
Core Tax Transformation Leader, PwC Middle East
Umer Subhani
Indirect Tax Partner, PwC Middle East
Khurram Iqbal
Partner, Zakat and Tax, PwC Middle East
Mujeeb Ul Haq
Partner, Indirect Taxes, PwC Middle East
Hafez Yamin
Partner, Indirect Tax and Tax Technology Lead, Tax and Legal Services, PwC Middle East
Dima Maruf
Partner, Indirect Taxes, PwC Middle East
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