SZTAC 99/2020/IAR; 2018/1566/Z
Delay fines are considered among the normal expenses that result from the nature of the business and that lead to a reduction in the taxpayer’s revenues and the deduction award for the purposes of calculating the profit subject to zakat.
Background
On Monday 22/04/1442 AH corresponding to 07/12/2020 AD, First Appeals Chamber for Income Tax Interventions and Disputes formed pursuant to Saudi Arabia Royal Order No. 65474/1439 dated 23/12/1439 AH based on Paragraph (b) of Article 67 of the income tax system issued by Saudi Arabia Royal Decree No. M1/1425 dated 15/10/1425 AH and amended by Saudi Arabia Royal Decree No. M113/1438 dated 20/11/1438 AH, at its headquarters in the city of Riyadh, in order to consider the appeal submitted on 18/08/ 1438 AH, from the company. On the decision of the Second Primary Tax Zakat Objection Committee in Riyadh, No. (15) for the year 1438 AH, issued in Objection No. (37/37) filed by the appellant in the face of the General Authority for Zakat and Income, in which the preliminary decision stipulated the following:
First: Acceptance of the objection in the form of a company..... on the amended zakat assessment for the year 2012 AD.
Second: In merits: