As a part of the Saudi Arabian government’s plan to counter the unofficial economy and further control taxes, it is now mandatory for Saudi Arabians to use e-invoicing in all their dealings.
The General Authority of Zakat and Tax (GAZT) has issued the guidelines and framework of E-invoicing in KSA to help the citizens understand what they need to do to comply with the new regulations.
Currently, people are preparing for the first phase of the project “Issue and storage”, which requires tax-paying individuals to generate and record all their transactions and invoices in E-invoice form by December 4th 2021. Afterwards, the project is scheduled to move on to the second phase “integration” where taxpayers are obligated to share these records with GAZT for authentication and stamping between July 2022 and January 1st 2023.
According to the publication, E-invoicing is mandatory for every taxable individual in KSA and any third-parties who generate bills and invoices on behalf of a taxable individual in KSA.
Here is a breakdown of the tasks mandated by the Saudi Arabian government during phases 1 and 2
Preparing for phase 1
-
Taxpayers need to install E-invoicing solutions or optimize their existing system for E-invoicing.
-
Taxpayers need to add QR codes to their invoices.
-
Taxpayers need to add their VAT number to the invoices.
During Phase 1
-
Taxpayers generate and record E-invoices with regards to the guidelines published by GAZT.
-
The E-invoice is required to include all the points described by GAZT.
-
Taxpayers send the buyer or customer a copy of the invoice.
Starting December 4th 2021, invoices that do not comply with these requirements, issued manually, or deleted after they are invoiced will be considered a violation.
Preparing for Phase 2
-
Taxpayers to generate invoices in XML, PDF/A-3 formats.
-
Adding features to avoid tampering with invoices.
-
Generating a universally unique identifier.
-
Integrating with the GAZT systems.
LABS has recently become a premium partner for Pagero, the international E-invoicing platform and a member of open peppol to help digitalize and automate E-invoicing in KSA according to the guidelines issued by GAZT.
With this new partnership, we at LABS can take over the E-invoicing needs of our partners in KSA to make the E-invoicing process run simply and smoothly with a single click, so that our partners can trust us with this matter and focus on their business growth.
If you are interested in installing a new E-Invoicing system or updating your current system to comply with the new E-Invoicing guidelines in KSA, contact us.
Your digital transformation partner.
