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Saudi Arabia: GAZT published final guidelines of the controls, requirements, technical specifications and procedural rules for implementing the provisions of the E-Invoicing Regulation

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31 May, 2021

In brief

On 28 May 2021, the Zakat, Tax and Customs Authority (ZATCA) has published the e-invoicing resolution setting out the controls, requirements, technical specifications and procedural rules covering the generation and integration phases which includes VAT invoices, debit and credit notes. A detailed set of requirements and guidelines were also published.

The generation phase will be mandated from 4th of December 2021 and the integration will be implemented in phases starting from 1st of January 2023.

In detail

As part of the transitional journey towards e-invoicing, ZATCA has published the final resolution and simplified guide of the controls, requirements, technical specifications and procedural rules for implementing the provisions of the E-Invoicing Regulations.

The guideline aims to specify the business and technical requirements to be mandated as part of the journey toward e-invoicing. 

The guideline is set to identify controls, requirements, technical specifications, or procedural rules required for the implementation of E-Invoicing Regulation provisions which are related to the following:

  • Generation of Electronic Invoices (e-invoices) and Electronic Notes (e-notes), including provisions related to its processing, and record keeping, effective 4th December 2021.

  • Integration phase, transmission of Electronic Invoices and Electronic Notes, and sharing them with the Authority, which shall be implemented through phases starting from 1st January 2023.

For phase 1, by 4th of December 2021, taxpayers are required to:

  1. Ensure that they are equipped with a system that complies with the requirements of electronic invoicing for the first stage (generation stage). Taxpayers should work internally with their IT technical team or with an electronic billing systems provider to ensure that the technical requirements are met.

  2. Generate electronic invoices and store them through electronic invoicing systems and stop issuance of written invoices, handwritten or through text-editing software.

  3. Generate electronic invoices in a systematic manner in accordance with the VAT legislations.
    In addition, make sure that:

    1. For tax invoices: add the buyer’s VAT registration number (if registered for VAT) and the QR code (optional).

    2. For simplified tax invoices: add the QR code (mandatory) through a technical solution as per the e-invoicing specifications and requirements.

In addition, the resolution had two annexes attached to it that provide a detailed set of requirements which taxpayers are invited to review in details to assess its impact on their compliance journey:

  1. Annexe 1: Technical specification of the e-invoicing solution in respect of generating e-invoices and e-notes which include:

    1. the type, form and structure of the e-invoice/e-note.

    2. Data security features (e.g. hash, cryptographic stamp, etc.).

    3. Connectivity and data requirements of the technical solution.

    4. Restricted functional specifications.

  2. Annexe 2: The mandatory, conditional and optional fields that should be included on e-invoices or e-notes and those fields that are required to visible on the PDF file related to the e-invoice / e-note.

The Takeaway

The final rules issued by ZATCA provide guidance on the controls, requirements, technical specifications required for the generation and integration phases.

Businesses are encouraged to start assessing the impact of the e-invoicing regulations on their systems and processes and planning the journey towards a successful implementation by the set date of 4 December 2021, for the generation and storing phase.

Contact us

Mohammed Yaghmour

Leader, Zakat and Tax Leader - Saudi Arabia. Clients & Markets, PwC Middle East

Tel: +966 (12) 610 4400

Yaseen AbuAlkheer

KSA Tax Partner, PwC Middle East

Tel: +966544250540

Fehmi Mounla

Partner, Zakat and Tax, PwC Middle East

Tel: +966 2 610 4400

Mohammad Hussein Amawi

Partner, PwC Middle East

Tel: +966 126104400

Suleman Mulla

Partner, International Tax, PwC Middle East

Tel: +966 54 122 8051

Maher ElAawar

Partner, Middle East Indirect Tax and Fiscal Policy, PwC Middle East

Tel: +971 (0) 56 216 1109

Mohammed Al-Obaidi

Tax Partner, PwC Middle East

Tel: +966 1 465 4240

Fayez Aldebs

Partner in Tax, PwC Middle East

Tel: +966 11 0400

Chadi Abou Chakra

Partner, Indirect Tax and Fiscal Policy, PwC Middle East

Tel: +966 11 211 0400 Ext: 1858

Mohamed Harby

Partner, PwC Middle East

Tel: +966 56 907 2618

Ebrahim Karolia

Partner, International Tax and M&A Services, PwC Saudi Arabia

Tel: +966 11 211 0400 ext. 1771

Wael Osman

Tax & Zakat Partner, PwC Middle East

Tel: +966 13 849 6311

Mugahid Hussein

Partner in Tax, PwC Middle East

Tel: +966 (0)13 849 6311

Jay Riche

Partner and TLS Digital Solutions Middle East Leader, PwC Middle East

Tel: +971 56 385 4717

Hafez Yamin

Director, TLS Digital Solutions, PwC Middle East

Tel: +966 54 033 7096

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