Zakat, Tax and Customs Authority (ZATCA) determines the criteria for selecting the targeted taxpayers in the twelfth Wave for implementing the “Integration Phase ” of E-invoicing, as it clarified that the twelfth Wave included all taxpayers whose revenues subject to VAT exceeded (SAR 10 Mn) during 2022 or 2023.
ZATCA has announced that Phase Two (Integration Phase) of E-invoicing entails additional requirements compared to Phase One (Generation Phase). Key among these requirements is the integration of taxpayers’ E-invoicing solutions with ZATCA’s platform (Fatoora), issuing E-invoices in a specified format, and including additional fields in the invoices. Phase Two will be implemented gradually in waves, with ZATCA notifying each wave at least six months before their integration date.
ZATCA highlighted that the launch of Phase Two is part of the Kingdom’s broader economic development and digital transformation efforts, building on the success of Phase One. The initial phase, which yielded significant positive outcomes such as enhanced consumer protection, showcased the high level of awareness and swift compliance among taxpayers.
Phase One (Generation Phase) of E-invoicing was introduced on December 4, 2021. It required taxpayers subject to the E-invoicing Regulation to discontinue the use of handwritten or computer-generated invoices created with text editing or spreadsheet software. Instead, they must implement a technical solution for E-invoicing that meets the specified requirements, including generating and storing E-invoices with mandatory fields, such as a QR code.
