Saudi Arabia

Saudi Arabia introduced its e-invoicing programme, known as FATOORAH, in two phases. The first phase, from December 2021, required businesses to issue invoices from compliant electronic systems instead of paper or editable files. The second phase, the integration phase, requires businesses to connect those systems directly to ZATCA's platform so that invoice data flows to the tax authority as transactions happen.

The model is a centralised continuous transaction control system. Standard tax invoices between businesses are cleared by ZATCA before they reach the buyer, while simplified tax invoices to consumers are reported to ZATCA after they are issued. Every invoice carries a cryptographic stamp and a QR code, and invoices are linked in a hash chain, which makes them hard to change after the fact.

ZATCA has rolled out the integration phase in waves since January 2023, starting with the largest taxpayers. Wave 24 lowered the threshold to SAR 375,000, and Wave 25 halves it again to SAR 187,500, which brings a large number of smaller businesses into scope.

All VAT-registered businesses in Saudi Arabia have been subject to Phase 1 since December 2021. Phase 2 applies to each business when ZATCA selects it for a wave, based on its VAT-subject revenue in the reference years. ZATCA notifies the businesses in each wave at least six months before their integration deadline.

Wave 25 covers businesses with VAT-subject revenue above SAR 187,500 in any year from 2022 to 2025, with an integration deadline of 1 February 2027. Businesses below that level should watch for future wave announcements. Foreign businesses that are VAT-registered in Saudi Arabia are also in scope.

Once integrated, businesses must use an e-invoicing solution that meets ZATCA's technical and security requirements and is onboarded to the Fatoora platform with a cryptographic stamp identifier (CSID).

Standard tax invoices (B2B) must be sent to ZATCA for clearance before they are shared with the buyer. Simplified tax invoices (B2C) must be reported to ZATCA within 24 hours of being issued.

Invoices must carry the mandatory fields defined by ZATCA, including a QR code, a cryptographic stamp and a unique invoice counter, and they must be stored for the legal retention period. Credit and debit notes follow the same rules. Penalties apply to businesses that miss their wave deadline or issue non-compliant invoices.

Invoices are created as UBL 2.1 XML documents that follow ZATCA's data dictionary and validation rules. For sharing with buyers, a PDF/A-3 with the XML embedded can be used, but the XML is the legal invoice.

All integration runs through ZATCA's Fatoora platform, using its APIs for onboarding, clearance and reporting. Unlike the Peppol-based models in the UAE and Oman, Saudi Arabia uses its own central platform rather than an exchange network between service providers.

HubBroker connects your ERP to the Saudi e-invoicing requirements without replacing your system. We map your invoice data to ZATCA's UBL 2.1 format, add the required fields and validate every invoice before it is submitted for clearance or reporting.

Cleared invoices and their QR codes come back into your ERP, so you can share compliant invoices with your buyers straight away. Inbound invoices from your suppliers can be delivered to your ERP as structured data, and HubBroker's IDP converts any PDF invoices.

For groups operating across the Gulf, the same HubBroker setup can also cover the Peppol-based models in the UAE and Oman, so you can manage all three markets from one integration layer.