Saudi Arabia: Draft Electronic Invoicing Regulations for public consultation purposes
07 October, 2020
In brief
The General Authority of Zakat and Tax (‘GAZT’) has published a draft of the Electronic Invoicing (‘E-Invoicing’) Regulations on its website. Stakeholders are required to submit their opinion/feedback by 17th October 2020.
The aim of the initiative is to reduce the administrative burdens on taxpayers, increase the level of tax compliance, minimise hidden transactions and reduce anti-commercial concealment.
The draft Regulations are available in Arabic and can be accessed through the following link:
https://gazt.gov.sa/ar/RulesRegulations/UnderConsultations/Documents/E-invoicing.pdf
Recommendations, suggested amendments, comments and feedback can be shared with GAZT by emailing public_consul@gazt.gov.sa
In detail
The draft Regulations issued by GAZT include the following Articles:
- Article 1 – Definition
- Article 2 - Purpose and scope
- Article 3 - Persons subject to the regulation
- Article 4 - Provisions related to electronic invoices
- Article 5 -Technical and procedural rules
- Article 6 - Entry into force
The Regulations provide the terms, requirements and conditions related to E-Invoicing mentioned in Article 53 of the VAT Implementing Regulations. This initiative is available for taxable persons residing in KSA as well as clients or any third party who issues a tax invoice on behalf of the taxable person residing in KSA.
Non-resident taxable persons are not obligated to issue E-Invoices.
The Regulation highlighted the following provisions that will be affected by the E-invoicing Regulation:
- Provisions related to penalties and fines stated under Chapter 16 of the VAT Law
- Tax invoices - Article 53 of the VAT Implementing Regulations
- Credit and debit notices - Article 54 of the VAT Implementing Regulations
- Records - Article 66 of the VAT Implementing Regulations
- Penalties and fines - Chapter 16 of the VAT Law
Minimum requirements to enroll
The Regulations provide the following criteria and minimum requirements that shall be available in the e-invoicing solution:
- Taxpayers should be able to connect to the secure internet connection
- The connection should be fool proof and includes a mechanism that allows detection of any tampering that may occur by the user or any other party
- Taxpayers should take into consideration all the requirements and controls applied in KSA related to data and information security
The takeaway
Taxpayers should assess the impact of this initiative on their IT systems and take the necessary actions to be fully compliant with the new VAT requirements. Resident businesses should also take this opportunity to submit suggestions, comments, and the challenges they might have in relation the new Regulations.
Related content
Contact us
Mohammed Yaghmour
Middle East Tax & Legal Services Leader, PwC Middle East
Tel: +966 56 704 9675
Fehmi Mounla
Partner - Managed Services & Compliance Lead, PwC Middle East
Tel: +966 (5) 62 713073
Chadi Abou Chakra
Middle East Indirect Tax Network Leader, PwC Middle East
Tel: +966 11 211 0400 Ext: 1858
Ebrahim Karolia
Partner, International Tax and M&A Services, PwC Saudi Arabia
Tel: +966 11 211 0400 ext. 1771
Follow us
