ClearTax - Saudi Arabia (2024)

Those who meet the criteria must integrate their E-invoicing solutions with ZATCA by June 1, 2024, for wave 9. Taxpayers with VAT-subject revenues surpassing 30 Million Saudi Riyals (in 2021 or 2022) fall within the scope of wave 9. For Phase II, wave 9 customers are required to connect their ERP/POS with ZATCA servers using a middleware API, create E-invoices in XML or PDF/A3 format, and generate a universally unique identifier (UUID), cryptographic stamp, hash, and QR code

Taxpayers meeting the criteria are expected to integrate their E-invoicing solutions with ZATCA starting 1 March 2024 for wave 8. Taxpayers whose revenues subject to VAT exceed 40 Million Saudi Riyals (during 2021 or 2022) will come under wave 8. ZATCA Phase II will require wave 8 customers to integrate their ERP/POS with ZATCA servers using a middleware API, generate E-invoices in XML or PDF/A3 format, generate universally unique identifier (UUID), cryptographic stamp, hash and QR codes

According to ZATCA, the extension aims to provide support to taxpayers who meet the necessary requirements. Additionally, ZATCA has clarified that the exemption decision covers various fines, including those for late registration in all tax systems, late payment, late filing of returns in all tax systems, fines related to correcting VAT returns, and fines associated with violations of VAT field control pertaining to the implementation of e-invoicing regulations and other general regulations.

Taxpayers meeting the criteria are expected to integrate their E-invoicing solutions with ZATCA starting 1 December 2023 for wave 5, 1 January 2024 for wave 6 & 1 February 2024 for wave 7. Taxpayers whose revenues subject to VAT exceeded 100 Million Saudi Riyals, 70 Million Saudi Riyals and 50 Million Saudi Riyals (during 2021 or 2022) will come under wave 5, 6 & 7 respectively. ZATCA Phase II will require wave 5, 6 & 7 customers to integrate their ERP/POS with ZATCA servers using a middleware API, generate E-invoices in XML or PDF/A3 format, generate universally unique identifier (UUID), cryptographic stamp, hash and QR codes

Taxpayers meeting the criteria are expected to integrate their E-invoicing solutions with ZATCA starting 1 November 2023. Taxpayers whose revenues subject to VAT exceeded (150 Million Saudi Riyals) during 2021 or 2022 will come under wave 4. ZATCA Phase II will require wave 4 customers to integrate their ERP/POS with ZATCA servers using a middleware API, generate E-invoices in XML or PDF/A3 format, generate universally unique identifier (UUID), cryptographic stamp, hash and QR codes

Taxpayers meeting the criteria are expected to integrate their E-invoicing solutions with ZATCA starting 1 October 2023. Taxpayers whose revenues subject to VAT exceeded (250 Million Saudi Riyals) during 2021 or 2022 will come under wave 3. ZATCA Phase II will require wave 3 customers to integrate their ERP/POS with ZATCA servers using a middleware API, generate e-invoices in XML or PDF/A3 format, generate universally unique identifier (UUID), cryptographic stamp, hash and QR codes

They have emphasised that the establishments included in the second group were identified based on the standard of the volume of revenues subject to VAT for the year 2021, & whose revenues exceed half a billion riyals (500M SAR)

The Authority stated that the initiative's extension is motivated by a desire to help taxpayers who meet the requirements benefit from it to reduce the consequences of the covid-19 pandemic.The Authority has also clarified that the fines covered by the exemption decision, according to the Authority, include fines for late registration in all tax systems, late payment, late filing of returns fines in all tax systems, and fines to correct VAT returns, as well as fines for violations of VAT field control related to applying the e-invoicing regulations and other general regulations.

Following fines have been included in the exemption decision:
1. Penalties imposed for late registration in all tax systems;
2. Late payments fines;
3.Late submission of the declaration in all tax systems;
4. Late correcting fines of the declaration for value-added tax;
5. Fines related to the violations of electronic invoicing provisions and other general provisions of the value-added tax law.

Businesses included in the first integration will have to comply with Phase 2 requirements, starting from 1 January 2023 and no later than 30 June 2023.Taxpayers falling in this wave should fully meet all ZATCA e-invoicing requirements and fully integrate all their electronic solutions with ZATCA systems by the end of the above-mentioned date. Taxpayers not compliant by 1 July 2023 will face penalties.

that the taxpayers in the first wave were selected based on the revenue subject to VAT for the year of 2021 exceeding (3 billion) SAR. ZATCA has stated that Phase Two (Integration Phase) requires additional requirements, the most prominent are to integrate taxpayer's e-invoicing solutions with ZATCA's Platform (FATOORA), issue electronic invoices based on a specific format, and include additional fields in the invoice. Furthermore, Phase Two (Integration Phase) of e-invoicing would take place gradually and into waves, and ZATCA would inform the following waves directly at least six months before their integration date.