Latest ZATCA Waves & Compliance Dates

Saudi Arabia continues its ambitious digital transformation in taxation with the ongoing rollout of ZATCA?s E-Invoicing (Fatoorah) system. As of mid-2026, Phase 2 (the Integration Phase) is expanding rapidly to include smaller businesses, with Wave 24 representing a major step toward broader compliance.

This blog post covers everything you need to know about the latest developments, requirements, deadlines, and how to prepare?whether you?re a business owner, accountant, or IT professional in the Kingdom.

Quick Overview: Phase 1 vs. Phase 2

ZATCA (Zakat, Tax and Customs Authority) structured e-invoicing into two main phases:

• Phase 1 (Generation Phase): Enforced from December 4, 2021. All VAT-registered taxpayers (except non-residents) must generate, store, and issue tax invoices and notes using compliant electronic solutions. This replaced manual/paper processes with basic digital requirements.
• Phase 2 (Integration Phase): Rolled out in waves starting January 1, 2023. This is the more advanced stage requiring:
• Integration of your e-invoicing solution with ZATCA?s Fatoora platform.
• Real-time (or near real-time) clearance for B2B/B2G invoices.
• E-reporting for B2C transactions.
• Specific XML formatting, additional data fields, cryptographic stamps, and QR codes (mandatory for B2C).

Phase 2 aims to enhance tax transparency, reduce evasion, streamline compliance, and support Saudi Vision 2030?s digital economy goals.

Latest Rollout: Focus on Wave 23 and Wave 24 (2026)

ZATCA notifies targeted taxpayers at least six months in advance and implements in waves based primarily on annual VAT-taxable revenue from previous years (typically 2022?2024).

Key Recent Waves (as of May 2026):

• Wave 23: Targets businesses with VAT-taxable revenue exceeding SAR 750,000 (in 2022, 2023, or 2024). Compliance window: January 1 to March 31, 2026. This wave is now largely in effect.
• Wave 24 (Latest Major Phase): Targets businesses with VAT-taxable revenue exceeding SAR 375,000 (in 2022, 2023, or 2024). Compliance deadline: June 30, 2026. This wave brings in many more SMEs, marking a significant expansion.

Further waves are expected to lower thresholds even more, eventually covering nearly all VAT-registered entities.

Who Must Comply with Wave 24?

• VAT-registered taxpayers in Saudi Arabia.
• Annual VAT-taxable turnover > SAR 375,000 in any of the reference years (2022?2024).
• Includes resident businesses; specific rules may apply to branches or groups.

Non-compliance can result in penalties, so timely action is essential.

Key Requirements in Phase 2 Integration

1. System Integration ? Connect your invoicing/ERP software to the Fatoora platform for clearance and reporting.
2. Invoice Format ? Use ZATCA-approved XML standards with mandatory fields (e.g., seller/buyer details, cryptographic stamp).
3. Clearance & Reporting ? B2B/B2G invoices require prior clearance; B2C requires e-reporting (often with QR codes).
4. Archiving ? Secure, accessible storage of invoices for the required period.
5. Approved Solutions ? Use ZATCA-approved e-invoicing providers or onboarded ERP modules (many popular systems like SAP, Oracle, or local solutions offer integrations).

Benefits of Timely Compliance

• Avoid Penalties ? Fines for non-compliance can be substantial.
• Operational Efficiency ? Automated processes reduce errors, speed up payments, and improve cash flow.
• Competitive Edge ? Faster, more transparent transactions build trust with partners and government.
• Future-Proofing ? Alignment with broader digital initiatives in the Kingdom.
• Data Insights ? Better analytics from structured invoice data.

How to Prepare for Wave 24 (Step-by-Step)

1. Assess Your Status ? Review your VAT-taxable revenue for 2022?2024 and monitor ZATCA notifications.
2. Choose/Upgrade Solution ? Select a ZATCA-approved e-invoicing provider or ensure your current ERP integrates seamlessly.
3. Gap Analysis ? Audit current invoicing processes against Phase 2 technical requirements.
4. Integration & Testing ? Work with your vendor for Fatoora integration and conduct thorough testing.
5. Training & Change Management ? Train finance, sales, and IT teams.
6. Go-Live Before Deadline ? Aim to complete integration well before June 30, 2026.
7. Stay Updated ? Follow official ZATCA announcements, as rules can evolve.

Businesses using modern cloud-based ERPs often find integration smoother and faster.

Common Challenges & Edge Cases

• SMEs in Wave 24: Many smaller businesses may lack robust IT systems?partnering with experienced vendors is crucial.
• High-Volume Transactions: Retail, e-commerce, and distribution sectors need scalable solutions for real-time reporting.
• Multi-Entity Groups: Consolidated compliance strategies can save time.
• Legacy Systems: Older software may require upgrades or middleware.
• B2C QR Codes: Often overlooked but mandatory?ensure your POS systems support them.

Conclusion: Embrace of the Digital Shift

The rollout of Wave 24 by June 30, 2026, underscores ZATCA?s commitment to a fully digital tax ecosystem. Businesses that act proactively will not only avoid penalties but also gain efficiency and strategic advantages in Saudi Arabia?s evolving economy.

Don?t wait for the notification; start your compliance journey today.

Consult a certified ZATCA e-invoicing provider, ERP specialist, or tax advisor for tailored support.