All resident taxable persons in KSA are subject to the electronic invoicing regulation. They must issue electronic invoices along with electronic notes for all their transactions which require the issuance of tax invoices.
Saudi Arabia’s Zakat, Tax, and Customs Authority (ZATCA) have published e-invoicing requirements that will be rolled out into two main phases in KSA:
Phase One - Generation of Electronic Invoices and Electronic Notes is enforceable as of December 4, 2021. It will require a person subject to the E-Invoicing Regulation to generate and store compliant tax invoices and notes using compliant electronic systems.
Phase Two - The Integration Phase on the transmission of Electronic Invoices and Electronic Notes is enforceable starting from January 1, 2023, and implemented in waves by the targeted taxpayer groups.
SAP developed a KSA localized E-Invoicing solution for Phase One on top of SAP Document Compliance for SAP ECC and S/4HANA core modules (FI, SD, MM).
What should you know?
You as a taxable person in KSA and subject to E-Invoicing Regulation must note the following:
You must share with the buyer the Tax Invoice or its associated Notes (Credit/Debit Note) that have been electronically generated.
You must present to your customers a printed copy of the Simplified Tax Invoice or its associated Notes that have been generated electronically.
You can share with the buyer an electronic format or any other human-readable format of the Simplified Tax Invoice or its associated Notes upon the agreement between the transaction parties.
You must generate a QR code for Simplified Electronic Invoices and associated Notes (QR code is optional for Standard Electronic Invoice and its associated Notes for Phase One).
How SAP helps customers to be compliant with E-Invoicing Regulation for KSA for Phase One?
The key reasons to implement SAP E-Invoicing solution for Phase One are as follows:
Allows you to be compliant with the specifications and requirements set forth under
the e-Invoicing Regulation after verifying its conformity to all specifications and requirements by
Helps you to generate Electronic Invoices and their associated Notes in XML format as per the Provisions of the E-Invoicing Regulation.
Helps you to generate the QR code and be embedded in the XML format.
Allows you to extract the QR code using printing programs (such as PDF Forms). This helps the customer to utilize any format as a human-readable format to share the Tax Invoice (printed QR code) with buyers.
Allows you to share/send the generated XML file with the buyer via emailor any other electronic channel.
Saves your time in your implementation project for Phase Two, focusing on integration requirements only.