ZATCA in KSA is imposing heavy VAT Fines and Penalties in Saudi Arabia for non compliance. Contact BMS Auditing Saudi Arabia to avoid VAT fines and ensure VAT compliance. The standard VAT for KSA was 5%, however, for certain goods, the VAT imposed is nil.  Since July 2020, the updated rate of VAT has been 15%. So, see how this changed the VAT fines and penalties in Saudi Arabia

Is your business registered under VAT in Saudi Arabia? Then, it is necessary to ensure that your business activities are VAT compliant and follow the rules. The VAT law in Saudi Arabia imposes heavy penalties if you are not compliant with the VAT regulations. 

VAT Penalties Saudi Arabia

 

  1. Submission of false documents to escape from paying the tax due or minimizing the value

    • Fine: More than the VAT due and not more than 3 times the value of goods & services

  2. Moving the goods in and out of the country without paying VAT due

    • Fine: More than the VAT due and not more than 3 times the value of goods & services

  3. Late VAT Registration penalty in KSA

    • Fine: Amount of 10,000 Saudi Riyal

  4. Late VAT Return Submission penalty in KSA

    • Fine: 5-25% of the VAT due

  5. Late VAT payment penalty in KSA

    • Fine: 5% of the VAT due for each month

  6. VAT collection without registering

    • Fine: Up to 100,000 Saudi Riyal

  7. Not maintaining accounting books & records as per the regulations

    • Fine: Up to 50,000 Saudi Riyal

  8. Not allowing the tax authority employees to do their respective duties

    • Fine: Up to 50,000 Saudi Riyal

  9. Violating the provisions of VAT regulations or law

    • Fine: Up to 50,000 Saudi Riyal

  10. Delay in paying VAT (beyond 30 days)

    • Fine: 2% on the VAT at day 15 + 2% at day 30
    • Penalty: 4% of the outstanding balance every year

What is the penalty for late VAT payment in Saudi Arabia?

5% of the value of the unpaid tax for each month or part thereof for which the tax has not been paid.

What is the penalty for late VAT return filing in Saudi Arabia?

Not less than 5% and not more than 25% of the value of the tax due.

Read More: VAT Fines and Penalties in UAE

VAT Penalty Reviews & Appeals in KSA

The VAT in KSA includes two independent committees- the subset of Committee for the Settlement of Tax Violation and Disputes, are set up to control taxpayer’s appeals. They are as follows:

  • VAT FirstInstance Committee: Responsible for findings on violations, disputes, claiming public and private rights implementing the provisions of tax regulations.

  • VAT Appeals Committee: Responsible for conclusion on arguments against the decisions by the First Instance Committee. As per the regulations, the taxpayers have the right to appeal against the decisions declared by the GAZT in 30 days from the date of notification. 

They are given another 30 days for presenting the second appeal to the VAT Appeals Committee in case of any objection with the decision of other committee. Once the appeal is reviewed, the decision by the Appeals Committee shall be finalised before any judicial authority. 

Read More: VAT Fines and Penalties in Oman

BMS Auditing Saudi Arabia enables you to remove the obstacles in growth by minimizing confusion about VAT returns with flexible solutions compatible with your business requirements. BMS KSA gives you a clear understanding about the VAT penalties in Saudi Arabia, so you could be alert always and pay the VAT without delay.

BMS Auditing takes away your stress from the boring paperworks, missed deadlines, tracking the rules and keeps you VAT compliant. We cover all the elements of VAT and providing best VAT services in Saudi Arabia. Our VAT services include:

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