United Arab Emirates: KSA Tax relief measures in response to Covid-19 – Temporary extensions and suspensions

published on 17 April 2020 | reading time approx. 3 minutes

The Covid-19 virus has hit the world unexpectedly and has had an immediate impact on the world economy. Both – private and public sectors – had to take actions such as implementing home office in order to limit the spread of Covid-19. These measures do have a direct impact on the capacity of businesses to comply with the tax deadlines outlined in the tax framework in these days as a failure to maintain the deadlines – in general – would lead to a financial penalty along with further penalties. 

The Saudi Arabian General Authority of Zakat and Tax (GAZT) realized these challenges for businesses and announced the introduction of certain tax relief measures in response to Covid-19 (Coronavirus) on March 20th accordingly. 
 
The measures in general comprise tax reliefs and extension of tax filing- and payment deadlines as summarized below: 

• Zakat and tax returns filing deadline for the financial year 2019 has been extended by 3 months to 30 July 2020.
• VAT returns
  • The monthly VAT returns filing deadlines for February till May 2020 have been extended by 3 months as shown in the following overview:
    • February 2020: New deadline: 30 June 2020
    • March 2020: New deadline: 31 July 2020 
    • April 2020: New deadline: 31 August 2020
    • May 2020: New deadline: 30 September 2020
  • The quarterly VAT returns filing deadline for the 1st Quarter of the year 2020 has been extended to 31 July 2020.             

• Withholding tax returns filing deadlines for March till May 2020 have been extended by 3 months as shown in the following overview:
  • March 2020: New deadline: 10 July 2020
  • April 2020: New deadline: 10 August 2020
  • May 2020 : New deadline: 10 September 2020
• Excise tax returns filing deadlines for March and April 2020 have been extended as shown in the following overview:
  • March 2020: New deadline: 15 August 2020
  • April 2020: New deadline: 15 August 2020
• Customs duties collection on imported goods against submission of bank guarantees has been postponed for a period of 30 days each for the next three months.
• Payment, Fines and Enforcement
  • Requests for payments by instalments will be approved without any down payment.
  • Requested tax refund payments will be processed faster.
  • Fines for non-payments or delayed payment of taxes that are suspended will not apply.
  • Fines for late payment of instalments have been suspended until 30 June 2020.
  • Fines for non-cooperation of taxpayers have been suspended until 30 June 2020