e-invoicing Saudi Arabia: Announcement of various violations and fines by the Zakat, Tax, and Customs Authority (ZATCA)

0 Comments | Category 1

The Zakat, Tax, and Customs Authority had published a news article on Nov 16, 2021, on their website to announce various prominent violations of the electronic invoicing solution during the first phase of e- invoicing implementation, and the fines charged for such violations.

What is the e-invoicing implementation mandate?
The Kingdom of Saudi Arabia through ZATCA mandated implementation of electronic invoicing for all the resident VAT taxpayers in two phases – Phase 1, which is the generation and archival phase, will be implemented from Dec 04, 2021, and Phase 2, which is the integration phase, will be implemented from Jan 01, 2023.

Which actions are considered as violations by ZATCA with respect to electronic invoicing?
ZATCA has published the list of regulations which the taxpayers and the e-invoicing solution providers need to comply on Dec 04, 2020, and can be accessed from here. Some of the violations mentioned by ZATCA in the above-mentioned news article are as follows:

S.No Details of the Violation Penalty Fee (in Saudi Riya)
1 Non-issuance/non-archiving of invoices 5,000 – 50,000
2 Deletion /amendment of electronic invoices, other than through debit or credit notes, post issuance 10,000 – 50,000
3 Non-inclusion of QR code in the simplified tax invoices  

A warning is issued initially. Post that penalty up to maximum SAR 50,000 can be levied

4 Not informing ZATCA about any malfunction that hinder issuance of e-invoices
5 Non inclusion of VAT registration number of the buyer on the e-invoices, wherever required,

The authority further clarified that the fines are applied based on the type of violation and the number of times the violation is repeated.

The major goal of ZATCA is to completely stop the usage of handwritten and computer edited (using text editing or number analysis programs) invoices, and for the electronic invoicing solutions to comply with all the technical and security regulations like anti-tamper detection mechanism, inclusion of VAT number of the buyer, QR code on simplified tax invoices etc.

In case you have any further queries regarding Saudi e-invoicing or if you are looking for a compliant e- invoicing solution, please connect to us at sales@taxilla.com.

Leave a Reply