In one sentenceA penalty ZATCA imposes when tax is paid late; for VAT it is 5% of the unpaid tax for each month or part of a month.
Simply put
For VAT, the penalty is calculated at 5% for each month or part of a month, so a single day into a new month counts as a full month. Filing the return itself late has a separate penalty of between 5% and 25%, set by ZATCA.
For withholding tax and income tax payments, the penalty is 1% for every thirty full days of delay.
Worked example
A store did not pay VAT of 20,000 SAR, and the payment was two months and ten days late.
Unpaid tax20,000 SAR
Number of months or parts of monthsTwo months + a part = 3
Calculation20,000 × 5% × 3
Late-payment penalty3,000 SAR
Formula: Penalty = unpaid tax × 5% × number of months or parts of months
Don't confuse it with
VAT returnThe penalty for filing the return late is different from the penalty for paying the tax late, and both may apply.