Article 77 of the Saudi Income Tax Law
المادة 77 من نظام ضريبة الدخل · الفصل الرابع عشر: الغرامات
The article imposes a delay fine of 1% of the unpaid tax for each thirty days, and a fine of 25% of the tax difference where untrue information is provided or fraud is committed with intent to evade.
Official text (Arabic)
This article has not been amended since the law was issued.
أ - إضافة إلى الغرامات الواردة في المادة السادسة والسبعين من هذا النظام وفي الفقرة (ب) من هذه المادة ، على المكلف تسديد غرامة تأخير بواقع واحد بالمائة (1%) من الضريبة غير المسددة عن كل ثلاثين يوم تأخير ، وهذا يشمل التأخير في تسديد الضريبة المطلوب استقطاعها والدفعات المعجلة ، وتحسب من تاريخ استحقاق الضريبة إلى تاريخ السداد .
ب - علاوة على الغرامات الواردة في المادة السادسة والسبعين من هذا النظام وفي الفقرة (أ) من هذه المادة ، تفرض على المكلف غرامة مالية قدرها خمسة وعشرون بالمائة (25%) من فرق الضريبة الناتجة عن تقديم المكلف أو محاسبه القانوني معلومات غير حقيقية أو الغش بقصد التهرب من الضريبة ، وعلى الأخص في الحالات الآتية :
1 - تقديم دفاتر أو سجلات أو حسابات أو مستندات غير حقيقية لا تعكس الوضع الصحيح للمكلف .
2 - تقديم الإقرارعلى أساس عدم وجود دفاتر أو سجلات مع تضمينه معلومات تخالف ما تظهره دفاتره وسجلاته.
3 - تقديم فواتير أو وثائق مزورة أو مصطنعة أو تغيير فواتير الشراء أو البيع أو غيرها من المستندات بقصد تقليل الأرباح أو زيادة الخسائر.
4 - عدم الإفصاح عن نشاط أو أكثر من أنواع النشاط التي تخضع للضريبة .
5 - إتلاف أو إخفاء الدفاتر أو السجلات أو المستندات قبل قيام المصلحة بالفحص.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 77 explained in plain English
This article adds two types of fines that are cumulative with the fines of Article 76 and with each other:
1) The delay fine (paragraph a): 1% of the unpaid tax for each thirty days of delay, calculated from the date the tax fell due to the date of payment. It expressly covers delay in paying tax that was required to be withheld and in advance payments, not only the annual tax.
2) The fine for fraud and untrue information (paragraph b): 25% of the tax difference resulting from the taxpayer or his certified accountant providing untrue information, or committing fraud with intent to evade tax, especially in the following cases:
- Submitting books, records, accounts or documents that are untrue and do not reflect the taxpayer's true position.
- Submitting the return on the basis that there are no books while including information that contradicts what his books and records show.
- Submitting forged or fabricated invoices or documents, or altering purchase or sales invoices or others with intent to reduce profits or increase losses.
- Failing to disclose one or more of the activities subject to tax.
- Destroying or concealing books, records or documents before the Department examines them.
The phrase "especially" means these cases are prominent examples and not an exhaustive list. The article provides that these fines are in addition to the fines of Article 76 for not submitting the return or being late with it. It is followed by Article 78 on the liability of certified accountants. To respond to an accusation of fraud or to assess the fines in a particular case, it is advisable to consult a lawyer specializing in tax cases.
Practical example
A taxpayer in Jeddah was 90 days late paying unpaid tax of SAR 200,000, so a delay fine of 1% for each thirty days is due, that is 3%, equal to SAR 6,000. If it were found that he concealed an activity subject to tax and a tax difference resulted, a fine of 25% of that difference would also be imposed on him.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 77 of the Saudi Income Tax Law
What is the delay fine for late payment of income tax?
1% of the unpaid tax for each thirty days of delay, from the date the tax fell due to the date of payment.
Does the delay fine cover withholding tax and advance payments?
Yes. Paragraph (a) expressly provides that it covers delay in paying tax required to be withheld and advance payments.
What is the fine for tax evasion under the Income Tax Law?
25% of the tax difference resulting from providing untrue information or committing fraud with intent to evade, in addition to the other fines.
Articles this article refers to
More articles on Income Tax Penalties
- Article 56
The article makes the Authority responsible for administering, examining, assessing and collecting income tax and imposing its penalties, with a penalty imposed by decision of the Governor or whoever the Authority's board delegates.
أ - الهيئة هي الجهة المسؤولة عن أعمال الإدارة والفحص والربط والتحصيل لضريبة الدخل، وإيقاع العقوبات المنصوص عليها في هذا النظام. ب - يكون إيقاع العقوبة بقرار من
- Article 57
The article requires every person subject to income tax to register his activity before the end of his first fiscal year, excepts those subject only to final withholding, and imposes a fine of SAR 1,000 to 10,000.
أ - يجب على كل شخص خاضع للضريبة بموجب هذا النظام أن يقوم بتسجيل نشاطه لدى المصلحة قبل نهاية سنته المالية الأولى . ب - لا تنطبق أحكام هذه المادة على المكلفين الخ
- Article 76
The article imposes a fine of 1% of gross revenue, capped at SAR 20,000, for breaching the return provisions, and for late filing a fine of 5% to 25% of the unpaid tax where that is higher.
أ - تفرض غرامة على المكلف الذي لا يتقيد بأحكام الفقرات ( أ ، ب ، د ، و) من المادة الستين من هذا النظام مقدارها واحد بالمائة (1%) من إجمالي إيراداته على ألا تتجا
- Article 78
The article gives the Department the right to prosecute a certified accountant in court if it is proved that he submitted or certified incorrect statements contrary to generally accepted accounting principles with intent to help the taxpayer evade.
بما لا يتعارض مع نظام المحاسبين القانونيين ، للمصلحة الحق في ملاحقة أي محاسب قانوني قضائيا يثبت أنه قدم أو شهد على صحة بيانات غير صحيحة، وبما يشكل انتهاكا للمبا
- Article 79
The article sets out the Minister of Finance's powers to issue the Regulations and instructions, amend depreciation groups and rates, waive tax debt and fines where collection is impossible, and award bonuses to outstanding employees.
للوزير الصلاحيات الآتية : أ - إصدار اللائحة التنفيذية لهذا النظام. ب - إصدار التعليمات واتخاذ الإجراءات التي يراها ضرورية لوضع هذا النظام موضع التنفيذ . ج - تعد
- Article 80
The article provides that the Income Tax Law is to be published in the Official Gazette and take effect ninety days after the date of its publication.
أ - ينشر هذا النظام في الجريدة الرسمية ويعمل به بعد تسعين يوما من تاريخ نشره.
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.