ZATCA Announced Wave 6 Under Phase 2 of Saudi Arabia e-Invoicing

Zakat, Tax and Customs Authority (ZATCA) announced the sixth wave under phase 2 of Saudi Arabia e-invoicing. It clarified that the Value Added Tax (VAT) registered taxpayers whose turnover was more than SAR 70 million during 2021, or 2022 shall fall under wave 6 of phase 2.

Hence, wave six applicable taxpayers shall begin integrating their e-invoicing solutions with the Fatoora portal from 1st January 2024.

ZATCA stated that phase 2 requires additional requirements such as:

• Integrating e-invoicing solutions with ZATCA’s Fatoora portal
• Mentioning additional fields in the invoice as per rules and regulations
• e-Invoices issuance in a specified format

Further, it announced that the announcement regarding the applicability of phase 2 would be informed to the taxpayers minimum of six months before the integration date.

Accordingly, ZATCA notified the below waves till now:

• Wave 1 under phase 2: Taxpayers registered under Saudi VAT whose turnover is more than SAR 3 billion in 2021 must start integration from 1st January 2023.
• Wave 2 under phase 2: VAT-registered taxpayers in Saudi having a turnover of more than SAR 500 million and less than SAR 3 billion in 2021 must integrate with ZATCA’s Fatoora portal starting 1st July 2023.
• Wave 3 under phase 2: Taxpayers registered under KSA VAT with more than SAR 250 million and less than SAR 500 million in 2021 or 2022 shall integrate with the Fatoora portal from 1st October 2023.
• Wave 4 under phase 2: Taxpayers having more than SAR 150 million and less than SAR 250 million in 2021 or 2022 must integrate with the Fatoora portal starting 1st December 2023.
• Wave 5 under phase 2: Taxpayers having more than SAR 100 million and less than SAR 150 million in 2021 or 2022 must integrate with the Fatoora portal starting 1st December 2023.

The Authority stated that phase 2 of e-invoicing in Saudi extends economic development and digital transformation. Also, it considers phase 2 as a continuation of the success they achieved in phase 1 (generation phase).

ZATCA mentioned in earlier wave announcements that phase 1 of Saudi e-invoicing achieved positive results. Authority observed that implementing the generation phase raised consumer protection and created great awareness among taxpayers. 

ZATCA implemented phase 1 of e-invoicing in Saudi w.e.f 4th December 2021, which mandated VAT-registered taxpayers in Saudi to:

• Stop issuing handwritten invoices 
• Avoid computer-generated invoices through text editing software
• Adopt a ZATCA-compliant e-invoicing solution
• Including QR code and other data
• Store e-invoices and related Credit or Debit Notes (CDNs)