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Penalties under VAT in Saudia Arabia: What You Need To Know
What can I do if I’m unable to pay VAT to the authorities in due time?
If you are unable to pay in due time, you can request an extension of the due date from the ZATCA in writing. When writing to request an extension, you must include:
- The amount of tax owed.
- The tax periods associated with the sum.
- The reason for the failure to pay VAT by the deadline.
The ZATCA will reply within 20 days either accepting or rejecting the request.
What are the penalties for noncompliance under VAT?
| Description of Offense | Associated fine |
|---|---|
| Submission of false documents to evade payment of VAT due or reduce its value. | More than the amount of VAT due. Less than 3 times the value of the goods or services. |
| Movement of goods in and out of the KSA without paying the VAT due. | More than the amount of VAT due. Less than 3 times the value of the goods or services. |
| Non-registration for VAT in the allotted timeframe. | 10,000 SAR |
| Non-filing of VAT returns on time | 5 - 25% of the VAT due |
| Non-payment of VAT on time | 5% of the VAT due for each month |
| Collecting VAT without being registered | Up to 100,000 SAR |
| Not maintaining books and records as stipulated in the regulations. | Up to 50,000 SAR |
| Preventing the employees of the tax authority from performing their duty. | Up to 50,000 SAR |
| Violation of any provision of the VAT regulations or the VAT law. | Up to 50,000 SAR |
What happens if I don’t register for VAT in the allotted timeframe?
You will face a penalty of 10,000 SAR.
What happens if I don’t file VAT returns on time?
You will face a penalty which is 5 to 25% of the VAT due.
What happens if I don’t pay the VAT on time?
You will face a penalty which is 5 to 25% of the VAT due.
What happens if I collect VAT without being registered?
You will face a penalty of 100,000 SAR.
What happens if I don’t maintain my books and records as mentioned in the tax regulations?
You will face a penalty of 50,000 SAR.
What happens if I violate any provision of the VAT regulations or the VAT law?
You will face a penalty of 50,000 SAR.
What happens if I submit false documents to avoid paying of VAT?
You will face a penalty between the amount of VAT due and three times the value of goods or services.
What happens if I submit false documents in order to pay less VAT?
You will face a penalty between the amount of VAT due and three times the value of goods or services.