ZATCA stands for Zakat, Tax, and Customs Authority, which implements the first phase of e-invoicing in KSA, with businesses required to use it by December 4, 2021. With the help of e-invoicing, processing invoices, credit notes, and debit notes in a structured electronic format between seller and buyer will be simple.

What is E-Invoicing (FATOORAH)?

Electronic invoicing is a process that aspires to convert the issuing of paper invoices and notes into an electronic process that allows the buyer and seller to exchange and process invoices, credit notes, and debit notes in a structured electronic format using an integrated electronic solution.

E-invoicing streamlines corporate transactions, ensuring a smooth and secure process. For example, only credit notes are sent if a customer returns a product, and the original invoice cannot be changed.

Why is E-Invoicing Implementing in KSA?

E-invoicing is being implemented in Saudi Arabia to help businesses work more securely and efficiently. This approach attempts to combine company data with ZATCA to make the trading system more transparent. The government uses a machine-readable format to standardize the way invoices are generated. As a result, there would be additional chances to discover fraudulent actions after confirming the e-invoices via the ZATCA portal. In addition, this information aids tax officials in reducing the frequency of audits.

The following are some of the advantages of DS365 ZATCA E-Invoicing F&O App for buyers and sellers:

Business owners will be less likely to have problems with streamlined e-invoicing.

Invoices for the tax refunds are generated in real-time.

High-level data protection

There are fewer fraud risks with an aligned e-invoicing system for confirming invoices, resulting in increased competition and trade.

How does E-Invoicing (FATOORAH) work?

In KSA, e-invoicing will be implemented in two phases.

Phase One

Phase one is also known as the generation phase. Taxpayers will generate and save e-invoices beginning December 4, 2021. You will have access to a ZATCA compliant e-invoicing system throughout this period. Therefore, you do not need to communicate any data or invoices with ZATCA during the generation phase.

Phase Two

The second phase is also known as the integration phase. Phase two will be done in phases for specific taxpayer groups. You must connect e-invoices with the ZATCA system for verification beginning January 1, 2023. ZATCA will provide an integration notification six months in advance.

The technical needs will be the focus of the integration phase. Your system must use APIs to communicate with other systems, generate a UUID (Universally Unique Identifier), a digital signature, a unique number to distinguish invoices, and a cryptographic stamp.

E-Invoicing Guidelines for ZATCA Approved Businesses in Saudi Arabia

The e-invoicing requirements will cover all taxable products and services subject to VAT.

The e-invoicing process will be mandated for all VAT registered business owners in Saudi Arabia and third parties submitting tax invoices on behalf of a taxable person.

All B2B, B2C, and B2G transactions will be invoiced electronically.

Arabic and English will be the standard languages for e-invoicing.

Dynamics Stream Software Solutions is providing the customization services for the ZATCA E-Invoicing Dynamics 365 Finance app available for KSA. If you need to know more about DS365 ZATCA E-Invoicing F&O customization solutions for KSA, contact our specialist at info@dynamicsstream.com or call us at + 971 4 4373103 or visit our website www.dynamicsstream.com.

Supported Editions

This app supports application release 10.0.20 or above.

DS365 Zatca E-Invoicing for Finance & Operations

by Dynamics Stream