Compliance Alert - ZATCA reclassifies VAT relevant violations and penalties

On 30 January 2022, ZATCA issued a new decision that entitles new classifications for the penalties imposed for some violations of VAT Law. Some prominent points from the decision are as follow:

• Re-classification of violations and determining penalties, to begin with, first warning and educating the taxpayer before imposing a monitory fine.
• Granting the violator an appropriate period of up to three months from the date of inflicting the penalty to correct the violation, except for the violation of preventing or impeding the employees of the Authority from performing their duties and tasks.
• 12 months is the defining limit for a non-recurring violation, provided that the violation is treated and not committed again within the twelve months.

Alongside the new decision, ZATCA published a simplified guide that describes the above with illustrative examples and greater details.