Mandatory e-Invoicing in the Kingdom of Saudi Arabia

KSA became part of the e‑Invoicing Revolution

- What does it mean, exactly?

The e-invoicing process called FATOORA applies to taxable persons who are residents in the Kingdom of Saudi Arabia, as well as to the customers or any third parties who issue a tax invoice on behalf of a taxable person who is a resident in the Kingdom according to the VAT Implementing Regulation.

First Phase of the law, effective as of December 4, 2021, requires companies to generate tax and simplified tax invoices, typically issued in B2C transactions, in an electronic, structured format, and to store them electronically in a compliant manner.

The generated e-invoices must contain all mandatory fields required by VAT regulations, including the buyer’s VAT number (if the buyer is a registered VAT taxpayer). A QR code is also required, but only for simplified tax invoices. For “standard” tax invoices, including a QR code is optional.

The second phase of integration, focused on e-invoice transmission, began on January 1, 2023, and is currently ongoing.

E-invoicing Timeline - Implemented Changes

2023
- January 1, 2023
  The first wave companies that are obliged to connect to ZATCA are those based on the revenue subject to VAT for 2021 exceeding (3 billion) SAR
- July 1, 2023
  Taxpayers obliged to connect to ZATCA have revenues subject to VAT surpassing SAR 0.5 billion
- October 1, 2023
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 250 million Saudi Rials
- November 1, 2023
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 150 million Saudi Rials
- December 1, 2023
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 100 million Saudi Rials
2024
- January 1, 2024
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 70 million Saudi Rials
- February 1, 2024
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 50 million Saudi Rials
- March 1, 2024
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 40 million Saudi Rials
- June 1, 2024
  Taxpayers obliged to integrate their e-Invoicing systems with the FATOORA platform are those with VATable income exceeding 30 million Saudi Rials
- November 1, 2024
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 15 million Saudi Rials in 2022 or 2023
- December 1, 2024
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 10 million Saudi Rials in 2022 or 2023.
2025
- January 1, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 7 million Saudi Rials in 2022 or 2023.
- February 1, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 5 million Saudi Rials in 2022 or 2023.
- May 31, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 4 million Saudi Rials in 2022 or 2023.
- June 30, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 3 million Saudi Rials in 2022 or 2023.
- July 31, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 2.5 million Saudi Rials in 2022 or 2023.
- August 31, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 2 million Saudi Rials in 2022 or 2023.
- September 30, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 1,75 million Saudi Rials in 2022 or 2023.
- October 31, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 1,5 million Saudi Rials in 2022 or 2023.
- November 30, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 1,25 million Saudi Rials in 2022, 2023 or 2024.
- December 31, 2025
  Taxpayers obliged to integrate their e-invoicing systems with the FATOORA platform are those whose VATable income exceeded 1 million Saudi Rials in 2022, 2023 or 2024.

Who is obliged to use e-Invoicing

Who is obliged to use e-Invoicing in Saudi Arabia

All taxable persons (excluding non-resident taxpayers) and third parties issuing tax invoices on behalf of a taxpayer that is subject to VAT are obliged to send e-Invoices.

E-invoicing process description

E-invoicing generation phase

No e-invoicing format was required, as long as all required fields are included in invoices and notes - buyer's VAT number (if the buyer was a registered VAT payer) and QR code (which was mandatory only for simplified VAT invoices)
Ability to generate tax invoices and simplified tax invoices in electronic, structured format, and to store compliant e-invoices electronically

Integration phase

Focuses on transmission of e-invoices and its integration with ZATCA
Once an e-invoice is cleared by the authority, suppliers can share the invoice or associated note with the customers
Required electronic invoices to be generated in XML or PDF/A-3 (with embedded XML) format
Required unique identifier (UUID), cryptographic stamp, hash and QR codes
Simplified e-invoices may be shared directly with the customer while reporting of such invoices should happen within 24 hours of generation

Current phase

Taxpayers notified by ZATCA on the date of their integration at least six months in advance, starting from January 1st 2023

What is the required format of an e-Invoice

Starting with the Integration phase, the invoice must be in XML format in order to be shared with the authority using the API for clearance and reporting.

Archiving requirements for e-invoicing in Saudi Arabia

Electronic invoices may be stored in a server on-premises in the KSA or in the cloud according to the provisions in VAT Law, VAT Implementing Regulation, E-Invoicing Regulation and resolutions and all other relevant Laws in KSA.

How integrity and authenticity may be ensured?

It is required to implement security measures in the form of an electronic seal, which is created using cryptographic algorithms.

How we can help

Comarch is officially certified by the ZATCA as a Qualified E-invoicing Solution Provider in the Kingdom of Saudi Arabia. This certification enables Comarch to support the exchange of invoices through the ZATCA platform, including compliance with B2C reporting requirements.

Why is Comarch the best choice?

We have 20+ years of experience in carrying out various EDI, e-invoicing, and other document exchange projects around the world. In those years, we have successfully connected more than 130,000 entities from over 60 countries.

1. Legal compliance
Full compliance with the latest data exchange regulations and modern data transfer standards
2. Digitization
Applying new technologies and IT solutions in order to streamline workflows and automate activities and procedures
3. Individual approach
Tailor-made solutions based on processes specific to each company – own road map and a suitable pace of changes
4.Security
Highest level of security for all sensitive and important company data

Want to know more?

Characteristics of the e-invoicing in Saudi Arabia

B2B e-invoicing and simplified e-invoicing (usually used in B2C) has been mandatory since December 4^th 2021.
The second phase (integration) starts as of January 1^st 2023.

E-invoice format and platform

For the generation phase (December 4^th 2021), there is no specific format required to generate and store the e-Invoices. Starting with the Integration phase, the invoice must be in XML format in order to be shared with the authority using the API for clearance and reporting.

ESAL is a national platform for e-invoicing exchange in Saudi Arabia.

E-invoicing process description

The first phase of implementation requires companies to be able to generate tax invoices and simplified tax invoices in electronic, structured format, and to store compliant e-invoices electronically.
Second, the integration phase focuses on the transmission of e-invoices. Once an e-invoice is cleared by the authority, suppliers can share the invoice or associated note with the customers.
Simplified e-invoices may be shared directly with the customer while reporting of such invoices should happen within 24 hours of generation.

Integrity and authenticity

The supplier is responsible for the accuracy of the invoices issued, and for implementing security measures and adequate controls to prevent tampering with records stored electronically. It can be done by an electronic stamp which is created via cryptographic algorithms.

Archiving

Persons subject to the E-Invoicing Regulation may store their electronic invoices in a server on-premises in the KSA or in the cloud as per their solution requirements and storage requirements, and according to the provisions in VAT Law, VAT Implementing Regulation, E-Invoicing Regulation and resolutions and all other relevant Laws in KSA.

Frequently Asked Questions

1. Is e-invoicing mandatory in Kingdom Saudi Arabia?
E-invoicing has been obligatory in Saudi Arabia since December 4th, 2021.
2. Who is liable to send e-invoices in Kingdom Saudi Arabia?
All taxable persons (excluding non-resident taxpayers) and third parties issuing tax invoices on behalf of a taxpayer that is subject to VAT are obliged to send e-Invoices.

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