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13.5. Interest and Penalties

Late Return Filing

Algeria imposes a standard penalty of 25% for late filing of a return. Note, however, that if a return is filed within 1 month of the due date, the penalty is reduced to 10%. If filed within 2-months the penalty is reduced to 20%. In cases where a reminder notice is sent indicating the return is late, a 35% penalty will be applied if the return is not filed within 30 days of the notice.

If a company is loss-making or otherwise exempt from paying tax, the penalty for late filing is DZD 2,500 if filed within 1 month of the due date, and DZD 5,000 if filed within 2 months. The maximum penalty is DZD 10,000.

Effective 1 January 2018, the penalty for failing to file a return in case of foreign companies with temporary operations in Algeria has been increased to DZD 10 million.

Effective 1 January 2021, failure to file an annual summary statement attracts a fine of 25% of the declared tax result, capped at DZD 1 million which is increased to 35% if not submitted within 30 days of receiving a formal notice.

Effective 1 January 2021, an exemption from late payment penalties is provided for the payment of taxes and duties payable up to 31 December 2020, including parafiscal taxes, fines, and penalties, provided that a single lump-sum payment covering full tax debt is paid by 31 December 2021.

Underpaid Tax

Algeria imposes a penalty of DZD 10,000 to DZD 50,000 for underpaid tax not exceeding DZD 100,000.

For underpaid tax exceeding DZD 100,000, the penalty can range from DZD 50,000 to DZD 3 million. Depending on the severity of the infraction resulting in underpaid tax, a sentence of imprisonment from 1 to 20 years may be imposed.