In brief
For RETT that fell due before the Law took effect, ZATCA may reassess undervalued disclosed transactions within three years of the Law's entry into force, and undisclosed ones within three years of the later of its knowledge or that date. Breaches of old-regime exemption conditions remain assessable. Unpaid pre-Law tax attracts the old fines for the earlier period and 2% per month afterwards, with total fines capped at 50% of the unpaid tax. Old-regime refunds had to be claimed within 12 months of entry into force, or 60 days of a final decision or settlement.
RETT did not start in 2025. It has applied since 4 October 2020, under Ministerial Resolution No. 712. The RETT Law (Royal Decree No. M/84) and the current Regulations replaced that framework on 10 April 2025. Article 14 deals with transactions that fell due under the old rules but are reviewed, paid or refunded under the new ones.
The Provision: Exact Text
What It Means in Plain English
The RETT transitional provisions mean that transactions taxed between October 2020 and April 2025 are not closed. ZATCA can reassess disclosed ones until April 2028, and undisclosed ones for three years after it finds out. Unpaid old tax attracts the old fines up to April 2025 and 2% a month after, capped at 50% of the tax. The general refund window for old-regime tax closed in April 2026.
Key Dates
| Event | Date |
|---|---|
| RETT introduced (Ministerial Resolution No. 712) | 4 October 2020 |
| RETT Law and current Regulations take effect | 10 April 2025 |
| End of the reassessment window for disclosed pre-Law transactions | 10 April 2028 |
| End of the 12-month window for old-regime refunds | 10 April 2026 |
Breaking Down the Provision
14(a): Assessment windows
- Disclosed (registered) transactions: three years from 10 April 2025, so until 10 April 2028.
- Undisclosed transactions: three years from the later of ZATCA’s knowledge and 10 April 2025.
- Exemption breaches under the old rules: no limit from these windows.
14(b)(1): Blended fines with a 50% cap
For pre-Law tax still unpaid:
- Before 10 April 2025: fines under the old Implementing Regulations.
- After 10 April 2025: 2% per month or part of a month.
- Cap: total fines may not exceed 50% of the unpaid tax. ZATCA’s Guideline puts it as “in all cases” the fines “may not exceed 50% of the value of the unpaid tax after the effective date of the Law”.
14(b)(2): The 1% additional fine
If ZATCA amended the tax and notified the taxpayer before 10 April 2025, the additional 1% per month fine starts 30 days after 10 April 2025, or 30 days after notification, whichever is later.
14(c): Old-regime refunds
Claims for refunds available under the old regulations had to be filed within 12 months of 10 April 2025, which was 10 April 2026, or within 60 days of a final judicial decision or a settlement with ZATCA.
Worked Examples
Example 1: 2022 sale reassessed
A 2022 sale was registered at SAR 2,000,000. ZATCA’s indicators suggest a fair market value of SAR 2,600,000. ZATCA can reassess until 10 April 2028, adding SAR 30,000 of RETT, with fines on the shortfall subject to the 50% cap.
Example 2: Undisclosed 2021 transfer
An unregistered 2021 transfer comes to ZATCA’s attention in March 2027. ZATCA has until March 2030 to assess.
Example 3: Unpaid 2024 tax
RETT of SAR 100,000 fell due in 2024 and remains unpaid. Old-regime fines apply up to 10 April 2025, then 2% per month. Total fines stop at SAR 50,000.
Common Mistakes
- Assuming pre-2025 transactions are closed. Disclosed ones remain open until April 2028.
- Missing the refund deadline. The general window has closed. Only the 60-day route after a final decision or settlement remains.
- Forgetting old-regime exemption conditions that are still running.
The Bottom Line
Article 14 keeps the 2020–2025 RETT period open for review until April 2028 for disclosed transactions, and longer for undisclosed ones. Anyone with significant pre-2025 transactions should check their values and exemption conditions now. For undisclosed transactions, voluntary disclosure is generally the better course.
Key takeaways
- The RETT Law and the current Regulations took effect on 10 April 2025. RETT itself has applied since 4 October 2020 under Ministerial Resolution No. 712.
- Disclosed pre-Law transactions: ZATCA can reassess undervalued transactions until 10 April 2028, three years from entry into force.
- Undisclosed pre-Law transactions: ZATCA has three years from the later of learning of the transaction or 10 April 2025.
- Breaches of exemption conditions under the old regulations remain assessable regardless of these windows.
- Fines on unpaid pre-Law tax: old-regime fines up to 10 April 2025, then 2% per month, with the total capped at 50% of the unpaid tax.
- The 12-month window for old-regime refund claims closed on 10 April 2026, unless a final decision or settlement opens a 60-day window.
Frequently asked questions
Can ZATCA still reassess a property sale from 2022?
Yes. If the transaction was disclosed (registered) with ZATCA, it can verify the value and reassess any undervaluation within three years of the RETT Law taking effect, which is until 10 April 2028. If it was never disclosed, ZATCA has three years from the later of learning about it or 10 April 2025.
How are fines calculated on RETT unpaid before April 2025?
Under Article 14(b), fines under the old Implementing Regulations apply for the period before 10 April 2025. After that date, a fine of 2% of the unpaid tax applies for each month or part of a month. Total fines are capped at 50% of the unpaid tax.
Can I still claim a refund of RETT paid under the old regulations?
Only if you are within the time limit. The 12-month window from the Law's entry into force ended on 10 April 2026. A claim is still possible within 60 days of a final judicial decision or a settlement decision with ZATCA about the transaction.
What if I breach an exemption I claimed under the old regulations?
ZATCA can still demand the tax. Article 14(a)(3) preserves its right where the restrictions of the regulations in force at the time of the transaction are violated, regardless of the three-year windows.
Sources
Based on the RETT Law (Royal Decree No. M/84, effective 10 April 2025), the RETT Implementing Regulations (ZATCA Board Resolution No. 01-03-25 dated 24 March 2025, unofficial English translation) and ZATCA's Detailed RETT Guideline Version 6 (May 2026). The Arabic text prevails. This article is general information, not advice on any specific transaction. dariba.co is an independent knowledge platform and is not affiliated with ZATCA.
