Tech News

The Zakat, Tax, and Customs Authority (ZATCA) of Saudi Arabia has announced a significant milestone in its e-invoicing initiative, requiring all businesses in scope to fully integrate with the Fatoora Platform by July 31, 2025. This mandate is part of the 17th wave of Phase 2, also known as the "Integration Phase," aimed at modernizing tax compliance and enhancing transparency across the Kingdom.

Targeted Businesses and Compliance Requirements:
The latest phase applies to businesses with VAT-taxable revenues exceeding SAR 2.5 million during 2022 or 2023. These businesses must ensure their e-invoicing systems are compatible with ZATCA’s standards and integrated with the Fatoora Platform by the specified deadline.

Key Compliance Measures Include:

• Real-time Data Sharing: Businesses must upgrade their invoicing systems to enable real-time transmission and validation of invoices.
• Technical Upgrades: Systems should meet ZATCA’s security and data integrity standards.
• Timely Integration: Affected businesses will receive notifications from ZATCA to support their compliance efforts.

Phases of E-Invoicing Implementation:
Saudi Arabia’s e-invoicing reform consists of two major phases:

• Phase 1 – Generation Phase (December 4, 2021): Businesses were required to generate and store electronic invoices in a structured format.
• Phase 2 – Integration Phase (Ongoing): Involves direct integration with ZATCA's platform for real-time invoice validation and compliance monitoring.

Implications and Next Steps for Businesses:
Businesses must prepare by:

• Assessing Current Systems: Ensuring invoicing software meets the integration standards.
• Seeking Expert Guidance: Consulting with e-invoicing solution providers to streamline the transition.
• Monitoring ZATCA Updates: Staying informed through official announcements to avoid penalties.

Conclusion:
This mandatory shift to digital invoicing aligns with Saudi Arabia’s Vision 2030 goals of enhancing economic transparency and efficiency. Businesses are urged to act promptly to meet the July 31, 2025 deadline and avoid potential compliance issues.