Mandatory Electronic Invoicing in Saudi Arabia: FATOORAH Project

E-invoicing in Saudi Arabia

The e-invoicing project in Saudi Arabia is called FATOORAH and applies to B2B, B2C, and B2G transactions. The groundwork was laid in December 2020 when ZATCA, formerly known as GAZT, published the e-invoicing regulations outlining the terms, requirements, and conditions related to e-invoices and their associated notes. Non-resident businesses are exempt from this regulation.

The e-invoicing system is designed to enhance transparency, combat tax evasion, and streamline audit processes. Its implementation follows a progressive approach with several phases.

Phase 1: Preparation

Effective from December 4, 2021. During this phase, taxpayers are required to generate e-invoices using a compliant system that includes the mandatory fields, stores the invoices, and generates an electronic copy for the customer. Immediate transmission to the government system is not required. Manual invoices are no longer accepted during this phase.

The mandatory fields that must be included in e-invoices in Phase 1 are: the VAT number of the buyer (if registered as a VAT-eligible taxpayer), the issuance date of the e-invoice, and VAT details. Optionally, a QR code may be added, and it is mandatory for simplified invoices (B2C).

Phase 2: Integration with the ZATCA

Gradually implemented starting January 1, 2023, this phase requires businesses to integrate their invoicing systems directly with ZATCA’s platform.

All e-invoices, whether tax invoices or simplified tax invoices, and their associated electronic notes, must be generated in XML format or PDF/A-3 (with XML embedded). 

The invoices must be validated in real time, electronically signed, and submitted to the tax authority for registration.

How does the E-invoicing model work in Saudi Arabia?

B2B E-invoicing

E-invoicing in Saudi Arabia operates under a clearance model. This means that for an invoice to be considered legally valid, the tax authority, in this case the ZATCA, must validate it to confirm it complies with all tax requirements. The invoice must be sent to the ZATCA platform within a maximum of 24 hours via API. Once validated, the invoice can be delivered to the recipient in electronic or PDF format.

To ensure the integrity of e-invoices, the following security mechanisms must be implemented: electronic signatures, generation of a Universal Unique Identifier (UUID), creation of a hash, and inclusion of a QR code.

Additionally, all e-invoices must be stored for a period of seven years.

B2C Electronic Invoicing 

In the B2C model, the invoice must also be sent to the ZATCA in electronic format within a maximum period of 24 hours. In this case, the ZATCA does not validate the document, but the invoice must include a QR code with data defined by the tax authority.

For B2C transactions, businesses must issue Simplified Tax Invoices, which must contain the following key data:

• Seller Information:Información del vendedor: Name, address and VAT registration number.
• Transaction Details: Description of the goods or services sold, unit price, total amount before taxes, VAT amount, and the total amount including VAT.
• QR Code: A unique QR code that includes key information about the transaction, such as the invoice number, date, and VAT amount, allowing consumers and the ZATCA to verify the authenticity of the invoice. 

Do you need to comply with Saudi Arabia's FATOORAH requirements? We can help you. Watch our webinar and learn how the system works. Also in Arabic version.

E-invoicing implementation timeline 

1. As of January 1, 2023, the first wave companies that are obliged to connect to ZATCA are those based on the revenue subject to VAT for the year 2021 exceeding (3 billion) SAR.
2. As of July 1, 2023, taxpayers that are obliged to connect to ZATCA are those with revenues subject to VAT surpassing SAR 0,5 billion.
3. As of October 1, 2023, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 250 million Saudi Rials.
4. As of November 1, 2023, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 150 million Saudi Rials.
5. As of December 1, 2023, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 100 million Saudi Rials.
6. As of January 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 70 million Saudi Rials.
7. As of February 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 50 million Saudi Rials.
8. As of March 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 40 million Saudi Rials.
9. As of June 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 30 million Saudi Rials.
10. As of October 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 25 million Saudi Rials.
11. As of November 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 15 million Saudi Rials in 2022 or 2023.
12. As of December 1st, 2024, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 10 million Saudi Rials in 2022 or 2023.
13. As of January 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 7 million Saudi Rials in 2022 or 2023.
14. As of February1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 5 million Saudi Rials in 2022 or 2023.
15. As of March 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 4 million Saudi Rials in 2022 or 2023.
16. As of April 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 3 million Saudi Rials in 2022 or 2023.
17. As of May 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 2,5 million Saudi Rials in 2022 or 2023.
18. As of June 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 2 million Saudi Rials in 2022 or 2023.
19. As of July 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 1,75 million Saudi Rials in 2022 or 2023.
20. As of August 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 1,5 million Saudi Rials in 2022 or 2023.
21. As of September 1st, 2025, taxpayers obliged to integrate their e-Invoicing systems with the FATOORAH platform are those with VATable income exceeding 1,25 million Saudi Rials in 2022 or 2023.

EDICOM Global e-Invoicing Solution

EDICOM is a technology provider specializing in Electronic Data Interchange and e-invoicing solutions. Currently, EDICOM operates in over 75 countries and offers electronic invoicing solutions for electronic invoicing systems around the world. EDICOM’s technical and regulatory experience enables it to rapidly and effectively implement new solutions in new countries.

EDICOM’s International Electronic Invoicing Platform for the issuance and reception of electronic invoices is adaptable to the specifications of each country where you and your partners operate and is constantly updated to ensure compliance.