ZATCA Announced Wave 8 Under Phase 2 of Saudi Arabia e-Invoicing

Zakat, Tax and Customs Authority (ZATCA) notified the eighth wave under phase 2 of Saudi Arabia e-invoicing. Further, it clarified that the businesses registered under Value Added Tax (VAT) with more than SAR 40 million turnover during 2021 or 2022 fall under wave 8 of phase 2.

Hence, wave eight applicable businesses shall begin integrating their e-invoicing solutions with the Fatoora portal w.e.f 1st March 2024.

The Authority mentioned that phase 2 requires additional requirements such as:

• e-Invoicing solutions integration with the Fatoora portal
• Including notified other fields in the invoice
• Issuing e-invoices in the specified format

Also, ZATCA announced that they would inform the concerned businesses of the applicability of phase 2 a minimum of six months before the integration date.

Accordingly, ZATCA announced the below waves till now:

• Wave 1 under phase 2: KSA VAT registered businesses with more than SAR 3 billion turnover in 2021 shall integrate from 1st January 2023.
• Wave 2 under phase 2: KSA taxpayers registered in Saudi with more than SAR 500 million and less than SAR 3 billion turnover in 2021 shall integrate with the Fatoora portal starting 1st July 2023.
• Wave 3 under phase 2: VAT-registered taxpayers in KSA having more than SAR 250 million and less than SAR 500 million turnover in 2021 or 2022 must integrate with the Fatoora portal from 1st October 2023.
• Wave 4 under phase 2: Taxpayers with more than SAR 150 million and less than SAR 250 million turnover in 2021 or 2022 must integrate with ZATCA w.e.f 1st November 2023.
• Wave 5 under phase 2: Businesses registered under KSA VAT with more than SAR 100 million and less than SAR 150 million turnover in 2021 or 2022 must integrate with the Fatoora portal starting 1st December 2023.
• Wave 6 under phase 2: Businesses with more than SAR 70 million and less than SAR 100 million turnover in 2021 or 2022 shall integrate with the Fatoora portal w.e.f 1st January 2024.
• Wave 7 under phase 2: Businesses registered under KSA VAT having more than SAR 50 million and less than SAR 70 million turnover in 2021 or 2022 shall integrate with ZATCA w.e.f 1st February 2024.

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

ZATCA mentioned that phase 1 of Saudi e-invoicing achieved positive results. Further, the Authority observed that implementing the generation phase raised consumer protection and created great taxpayer awareness. 

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

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