Taxation

Penalties

Violation of the provisions of the law, particularly failure to comply with tax obligations, exposes the taxable person to various financial penalties.
The offender remains subject to the applicable penalty provisions in accordance with the tax legislation.
General laws remain applicable to the offender in all matters that do not conflict with the Value Added Tax Law and related legislation.
What types of penalties apply to the taxpayer for each type of violation?

Type of Violation	Applicable Penalties
1- Delay or failure to submit the registration request	LBP 2,000,000 for joint-stock companies. LBP 1,000,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 300,000 for individuals and other taxpayers.
2- Failure to notify any change in the taxpayer’s name, address, trade name, or legal form	LBP 200,000 for joint-stock companies. LBP 100,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 50,000 for individuals and other taxpayers.
3- Delay or failure to declare final cessation of business	LBP 2,000,000 for joint-stock companies. LBP 1,000,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 300,000 for individuals and other taxpayers.
4- Delay or failure to submit the periodic declaration	5% of the tax due according to the declaration determined by the tax administration for each month of delay, or fraction of a month, provided that the penalty does not exceed 100% of the tax due for each declaration, and is not less than: LBP 750,000 for joint-stock companies. LBP 500,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 100,000 for individuals and other taxpayers.
5- Incorrect declaration	20% of the difference between the net tax due and the net tax declared, provided that the penalty is not less than: LBP 750,000 for joint-stock companies. LBP 500,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 100,000 for individuals and other taxpayers.
6- Submission of an amended periodic declaration	Within the original declaration deadline: no assessment penalty is due. Within 30 days from the expiry of the original declaration deadline: no assessment penalty is due, provided that the amended declaration does not result in additional tax exceeding 10% of the tax due. If the amendment results in additional tax exceeding 10% of the tax due, a penalty of 20% of the difference between the net tax due is imposed.
7- Failure to declare information	Assessment penalty of: LBP 200,000 for joint-stock companies. LBP 100,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 50,000 for individuals and other taxpayers. If the omission does not result in additional tax.
8- Failure to issue an invoice when required	2% of the value of the transaction subject of the invoice.
9- Failure to show the tax number or other formal information on the invoice	0.5% of the value of the transaction subject of the invoice.
10- Failure to keep accounting records and documents	Penalty of 50% of the undeclared net tax, provided that it is not less than: LBP 750,000 for joint-stock companies. LBP 500,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 100,000 for individuals and other taxpayers.
11- Obstruction of tax audit procedures	Penalty of 50% of the tax due according to the declaration, provided that it is not less than: LBP 750,000 for joint-stock companies. LBP 500,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 100,000 for individuals and other taxpayers.
12- Preventing the execution of compulsory collection procedures	Penalty of 5% per month of the tax amount to be compulsorily collected, provided that it does not exceed the amount of tax to be collected and is not less than: LBP 750,000 for joint-stock companies. LBP 500,000 for partnerships, limited liability companies, and institutions exempt from tax. LBP 100,000 for individuals and other taxpayers.
13- Issuing an invoice without legal basis	Three times the tax shown on the invoice, imposed on persons not registered for VAT.
14- Issuing an invoice that violates Article 38 of the law	25% of the tax due on the transaction subject of the invoice.
15- Failure to pay an amount shown on an invoice or similar document as tax	1.5% of the tax amount for each month of delay.

Reference: Law No. 44 dated 11/11/2008, Tax Procedures Law.