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Saudi Arabia will start implementing the mandatory application of the first phase of e-invoicing "fatoorah" tomorrow, Dec. 4.
The e-invoice, according to regulations, is a tax invoice that is issued electronically by each taxpayer subject to the value-added tax (VAT) in the Kingdom.
The first phase requirements include not using handwritten invoices or invoices written through text editors or number analysis applications on computers, as well as ensuring that there is a technical e-invoicing solution compatible with the relevant requirements.
The most prominent violations of the first phase include not issuing and saving the invoices electronically, with a fine SAR 5,000. Meanwhile, the fine of not including the QR Code in the e-invoice and not reporting any malfunction hindering from issuing the e-invoice to the authority starts with a warning. As for the fine of violating the deletion or modification of e-invoice, it starts from SAR 10,000.
The second phase of e-invoicing will be implemented in a phased manner, starting from Jan 1, 2023, to establish integration between e-systems of taxpayers and the authority’s regulations. The regulations require compliance with the technical specifications of the second phase of e-invoicing.
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