The Zakat, Tax and Customs Authority (ZATCA) has recently communicated the criteria for taxpayers included in the 19th Wave of the E-invoicing "Integration Phase." This wave specifically targets businesses whose VAT-subjected revenues surpassed SAR 1.75 million during either 2022 or 2023.
Crucial Integration Deadline: Businesses falling under this wave are mandated to integrate their E-invoicing systems with ZATCA's Fatoora platform by the deadline of September 30th, 2025.
This Integration Phase represents the next step after the initial "Generation Phase." It requires taxpayers to implement additional measures, such as:
- Integrating their E-invoicing solutions directly with ZATCA’s Fatoora platform.
- Adhering to a specific format for issuing electronic invoices.
- Ensuring all mandatory fields are included in each generated invoice.
The rollout of this phase is being conducted in a series of waves, with each wave receiving at least six months' notice prior to their respective integration deadline.
Overview of E-Invoicing Waves Under Phase 2
The following is a summary of the announced waves under Phase 2, illustrating the staggered approach to implementation:
- Wave 1: Businesses with a turnover exceeding SAR 3 billion in 2021: Integration by January 1, 2023.
- Wave 2: Businesses with a turnover between SAR 500 million and SAR 3 billion in 2021: Integration by July 1, 2023.
- Wave 3: Businesses with a turnover between SAR 250 million and SAR 500 million in 2021 or 2022: Integration by October 1, 2023.
- Wave 4: Businesses with a turnover between SAR 150 million and SAR 250 million in 2021 or 2022: Integration by November 1, 2023.
- Wave 5: Businesses with a turnover between SAR 100 million and SAR 150 million in 2021 or 2022: Integration by December 1, 2023.
- Wave 6: Businesses with a turnover between SAR 70 million and SAR 100 million in 2021 or 2022: Integration by January 1, 2024.
- Wave 7: Businesses with a turnover between SAR 50 million and SAR 70 million in 2021 or 2022: Integration by February 1, 2024.
- Wave 8: Businesses with a turnover between SAR 40 million and SAR 50 million in 2021 or 2022: Integration by March 1, 2024.
- Wave 9: Businesses with a turnover between SAR 30 million and SAR 40 million in 2021 or 2022: Integration by June 1, 2024
- Wave 10: Businesses with a turnover between SAR 25 million and SAR 30 million in 2022 or 2023: Integration by December 31, 2024.
- Wave 11: Businesses with a turnover between SAR 15 million and SAR 25 million in 2022 or 2023: Integration by January 31, 2025.
- Wave 12: Businesses with a turnover between SAR 10 million and SAR 15 million in 2022 or 2023: Integration between December 1, 2024, to February 28, 2025.
- Wave 13: Businesses with a turnover exceeding SAR 7 million in 2022 or 2023: Integration between January 1, 2025, and March 31, 2025.
- Wave 14: Businesses with a turnover exceeding SAR 5 million in 2022 or 2023: Integration between February 1, 2025, and April 30, 2025.
- Wave 15: Businesses with a turnover exceeding SAR 4 million in 2022 or 2023: Integration by May 31, 2025.
- Wave 16: Businesses with a turnover exceeding SAR 3 million in 2022 or 2023: Integration by June 30, 2025.
- Wave 17: Businesses with a turnover exceeding SAR 3 million in 2022 or 2023: Integration by July 31, 2025.
- Wave 18: Businesses with a turnover exceeding SAR 3 million in 2022 or 2023: Integration by August 31, 2025.
How Lavaloon Can Assist with ZATCA Compliance
Lavaloon understands the complexities of the ZATCA's e-invoicing mandates. We provide robust solutions to facilitate compliance with these regulations, ensuring a smooth transition to the Fatoora platform for businesses of all sizes. We're pleased to offer the KSA Compliance app, a free and open-source Frappe application specifically designed for KSA Compliance (ZATCA Integration). The app offers comprehensive support for both Phase 1 and Phase 2 requirements.
Key Features of the KSA Compliance App Include:
- ZATCA Phase 1 and Phase 2 Compliance: Full support for all requirements of both phases.
- Simplified and Standard Invoice Options: Flexibility in invoice generation to meet various business needs.
- Guided Onboarding: A user-friendly wizard to simplify the initial setup.
- Automatic ZATCA CLI Setup: Seamless configuration of the necessary tools.
- Tax Exemption Management: Handling of tax exemption reasons for accurate billing.
- ZATCA Dashboard: A centralized view for monitoring e-invoicing processes.
- Embedded Invoice QR & XML: Inclusion of necessary data within the invoice without impacting storage.
- Dedicated Print Formats: Specialized print formats for both ZATCA Phase 1 and Phase 2.
- Robust Resend and Rejection Processes: Streamlined management of invoice resends and rejections.
- ZATCA Integration Modes: Support for both Live and Batch data transmission.
- Multi-company and Multi-device Support: Scalable and adaptable solution for various business setups.
- Embedded Compliance Checks Log: Real-time monitoring of system compliance checks.
- System XML Validation: Ensures data accuracy through automated XML validation.
- ZATCA Sandbox Support: Ability to test integration in the ZATCA Sandbox environment, including support for the recent Wave 19.
With Lavaloon and the KSA Compliance app, businesses can confidently meet their ZATCA obligations and seamlessly transition into the E-invoicing Integration Phase.
