Penalties as per Saudi VAT Law

    2 years ago


Penalties as per Saudi VAT Law

 

Penalties for Tax evasion

Tax evasion shall be punishable by a fine of not less than the amount of Tax due and not more than three times the value of the Goods or Services which are the subject of the evasion (Article 40).

The Following will be considered as tax evasion

  1. Submitting false, forged or artificial documents, declarations registers or information with the intent to evade the payment of Tax due, reducing its value or unlawfully obtaining refunds for Tax. The Taxable Person shall prove lack of intent.
  2. Entering or attempting to enter or remove Goods or Services to or from the Kingdom, in violation of applicable laws, without paying the Tax in whole or in part, or in violation of the prohibitory provisions and restrictions set out in the Law or any other law 

Penalties for not registering for VAT as per the Law

Any Person who has not applied for registration within the period specified in the regulations shall be fined ten thousand (10,000) riyals (Article 41).

Incorrect filing of return

Any Person who files an incorrect Tax Return to the Authority, amends a Tax Return after filing or files any document with the Authority in relation to the Tax due by him which results in an error in the calculation of the Tax amount resulting in an amount that is less than the Tax due shall be liable to a fine equal to (50%) of the value of the difference between the calculated Tax and the Tax due (Article 42).

Delay in filing return

Any Person that fails to submit a Tax Return within the period specified by the Regulations shall be liable to a fine of not less than (5%) and not more than (25%) of the value of the Tax that he would have had to declare. (Article 42)

Nonpayment of Tax on due

Any Person who fails to pay the Tax due during the period specified by the Regulations shall be liable to a fine equal to 5% of the value of the unpaid Tax for each month or part thereof for which the Tax has not been paid. (Article 43)

Non registered person issuing VAT invoice

A non-registered Person shall be liable to a fine not exceeding one hundred thousand (100,000) riyals for issuing a Tax Invoice, without prejudice to any stricter penalty set out by any other law (Article 44).

Not maintaining books and records of transactions

A fine not exceeding fifty thousand (50,000) riyals shall be imposed on any of the following situation (Article 45)

  • Not kept Tax Invoices, books, records and accounting documents for the period set out in the Regulations and the fine shall be per Tax Period prevents or obstructs the employees of the Authority or anyone working for the Authority from performing their duties.
  • Violates any other provision of the Law or the Regulations.

 For repeated violation

If the same violation is repeated within three years from the date of issuing the final decision of a previous penalty, the fine, pursuant to that decision imposed on the violator, may be doubled (Article 47).

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Saudi vat law

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