What are the e-invoicing changes that were implemented starting from January 1, 2023, for target taxpayers?

The implementation of ZATCA e-Invoicing Phase 2 occurred in stages, organized according to target taxpayer groups, based on their annual turnover. Phase 2 was initiated on January 1st, 2023, and it introduced additional technical requirements that electronic invoicing systems needed to adhere to. This encompassed the integration of taxpayer electronic systems with ZATCA and the generation of electronic invoices in a specific format.

Because of the technical nature of these requirements, taxpayers were advised to seek assistance from an e-invoicing solution provider to ensure compliance with ZATCA's specifications.

What is Phase 2? When was it enforced and to whom does it apply?

Phase 2 or the Integration phase of ZATCA e-Invoicing was implemented starting January 1, 2023, and required subjective taxpayers to adhere to the business and technical requirements for e-invoices as well as integration with ZATCA's system.

The implementation of Phase 2 is taking place in waves. To read the implementation timeline and understand where you lie in the implementation stage, read: ZATCA e-Invoicing Implementation Timeline

What are the requirements for Phase 2?

ZATCA e-Invoicing Phase 2 imposed ZATCA an additional set of requirements. The specified list of mandatory fields in the second phase of e-invoicing includes UUID, Cryptographic Stamp, Cryptographic Stamp Identifier, Previous Invoice Hash, and QR Code.

To understand the requirements of Phase 2 in detail, visit: ZATCA e-invoicing phase II

Where can taxpayers and system developers find all the requirements for Phase 2?

To understand all the requirements of ZATCA e-Invoicing Phase-2, Connect with us at: +91 7303393220, Or visit our website: Webtel’s ZATCA e-Invoicing Software.

Should a taxpayer continue following Phase 1 requirements until Phase 2 applies to them?

Yes, taxpayers are expected to maintain their compliance with Phase 1 requirements until the integration enforcement date corresponding to their specific wave is announced by ZATCA. At that point, they are obligated to commence adhering to Phase 2 requirements.

It must be noted that the taxpayer is not required to implement Phase 2 requirements until notified by ZATCA about the integration enforcement date of the taxpayer’s wave.

Can a taxpayer use the same e-invoicing solution that was used for the generation phase (Phase 1)?

A taxpayer can use the same e-invoicing solution that was used for Phase 1, by updating the e-invoicing solution to comply with the Phase 2 requirements. The e-invoicing solution must adhere to the compliance requirements laid down by ZATCA.

Webtel’s ZATCA e-Invoicing Software is a complete solution for all your requirements for Phase 1 and Phase 2. To know more, visit: Fast & Reliable ZATCA e-Invoicing Software in KSA

How can a taxpayer integrate their existing invoicing system/ERP with ZATCA’s systems?

The taxpayer accesses the FATOORA portal using Taxpayer Portal credentials (ERAD) and then follows the EGS onboarding process. Read the step-by-step process for EGS Onboarding: EGS Onboarding e-Invoice Generation in Phase 2

How can a taxpayer verify that their e-invoicing solution has been successfully integrated?

After the successful onboarding of each EGS, the taxpayer will be notified indicating whether the e-invoicing solution has been successfully integrated. The taxpayers can also use the FATOORA Portal in order to view a summary list of all their integrated e-invoicing solutions.

Should a taxpayer share e-invoices with ZATCA before or after sharing with the buyer?

In the case of simplified tax invoices, typically issued by businesses to customers, taxpayers have the flexibility to decide whether to report e-invoices to ZATCA before or after sharing them with the buyer. However, it's essential to ensure that these e-invoices are reported to ZATCA within 24 hours after the invoice issuance.

For tax invoices, which are typically exchanged between businesses, taxpayers are required to share the e-invoices with ZATCA and obtain clearance before sharing them with the buyer. This ensures compliance with the established procedure.

Some requirements are technical, how can I prepare for e-invoicing?

The technical requirements are typically fulfilled by Webtel. Taxpayers may approach a solution provider or their internal technical teams to acquire or upgrade to a compliant electronic system.

To understand these technical requirements in detail, read: Mandatory fields in the second phase of e-invoicing

Should the invoice be in English or Arabic?

All the data fields that are visible in the human-readable form of the invoice must be in Arabic. VAT Regulations require the Tax Invoices and Simplified Tax Invoices to be in Arabic mandatorily. Invoice can be bilingual and include English as well.