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Businesses dealing with Saudi Arabia have two dates to plan around. ZATCA's initiative to cancel fines and waive financial penalties runs until 31 December 2026, and the 25th wave of e-invoicing integration must be live on ZATCA's FATOORA platform by 1 February 2027.
1. The fines waiver initiative — until 31 December 2026
ZATCA has announced the Minister of Finance's decision to extend the "Cancellation of Fines and Exemption of Financial Penalties Initiative" for a further six months from 1 July 2026, for taxpayers under all tax laws.
What it covers
- Fines for late registration under all tax laws;
- fines for late payment and late filing of returns;
- fines for correcting VAT returns.
Conditions
- Be registered with ZATCA for tax purposes.
- File all outstanding tax returns.
- Pay the full principal tax debt on those returns — or apply for an instalment plan while the initiative is open, and pay every instalment on time.
What it does not cover
- Tax evasion penalties, and fines under Article 45 of the VAT Law;
- fines already paid before the initiative took effect;
- penalties on any return that falls due after 30 June 2026. ZATCA has said that if the initiative is extended beyond 31 December 2026, the extension will not cover fines on those later returns either.
2. FATOORA Wave 25 — integrate by 1 February 2027
ZATCA has set the criteria for the 25th wave of Phase Two (integration): all taxpayers whose revenue subject to VAT exceeded SAR 187,500 in 2022, 2023, 2024 or 2025. They must integrate their e-invoicing solutions with FATOORA by 1 February 2027, and ZATCA notifies each taxpayer directly.
Integration means more than issuing electronic invoices. Invoices must be produced in the specified XML format with additional fields, standard (business-to-business) invoices must be cleared by ZATCA before they are issued, and simplified invoices must be reported. Most older invoicing systems need an upgrade or a new solution. Our Saudi tax and e-invoicing guide explains the requirements in full.
Checklist
- List any outstanding Saudi returns and unpaid principal tax, and the fines attached
- File and pay — or apply for an instalment plan — before 31 December 2026
- Check whether you have received a Wave 25 notification, and confirm your VAT-able revenue for 2022 to 2025
- Choose or upgrade your e-invoicing solution, test it, and plan go-live well before 1 February 2027
- Monthly VAT filers (supplies above SAR 40 million a year): file by the last day of the following month
Our taxation practice reviews Saudi VAT, Zakat and withholding positions with locally licensed professionals where representation is required, and our IT consulting practice supports FATOORA integration. Book a consultation.
Official sources
Frequently asked questions
Until when does ZATCA's fines waiver run?
The Cancellation of Fines and Exemption of Financial Penalties Initiative was extended for six months from 1 July 2026, so it runs until 31 December 2026. It does not cover penalties on returns falling due after 30 June 2026.
Who is in FATOORA Wave 25?
Taxpayers whose revenue subject to VAT exceeded SAR 187,500 in 2022, 2023, 2024 or 2025. They must integrate with FATOORA by 1 February 2027, and ZATCA notifies them directly.
This guide is general information based on the law as we understand it on the date shown, not advice for your situation. Tax rules change often — please speak to us before acting on it. See our disclaimer.