Riyadh- July 11, 2021:

The Zakat, Tax and Customs Authority (ZATCA) has highlighted three main steps for taxpayers who are subject to the E-invoicing (FATOORAH) regulation. It outlines the compliance requirements and process rules covering the generation and integration phase. The first phase will be mandated from December 4, 2021 and the integration will be done over a period beginning from January 1, 2023.

The three steps in the first phase are:

• Stop issuing handwritten invoices, or invoices issued manually through text editing softwares
• Use a compliant E-invoicing system to generate and store the invoices electronically, which can be a cash register machine, a cloud system, or an enterprise resource planning software (ERP).
• Additionally, the E-invoices must include all the requirements of a tax invoice. The simplified tax invoices must include a QR code, and the tax invoices must include the VAT number of the buyer (a registered VAT taxpayer).

The Authority aims to gradually introduce the implementation of E-invoicing through well-laid out steps and requirements, and would continue to inform and educate taxpayers who are subject to the E-invoicing regulation.

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