The ZATCA Invoice Format is a mandatory requirement for businesses operating in Saudi Arabia. Enforced by the Zakat, Tax, and Customs Authority (ZATCA), these regulations aim to combat tax evasion, enhance financial transparency, and streamline auditing processes.
But what does the ZATCA Invoice Format entail? What are the differences between a tax invoice and a simplified tax invoice? How can businesses ensure full compliance with e-invoicing regulations? This guide provides all the essential details.
What Is an E-Invoice?
An e-invoice is a digital document created, stored, and transmitted electronically according to predefined standards. It replaces traditional paper invoices, ensuring tax compliance and reducing fraud risks.
To meet ZATCA invoice format requirements, an e-invoice must be machine-readable, compatible with approved e-invoicing systems, and securely transmitted to ZATCA for validation.
Also read: E Invoice Requirements: Explained Are You Compliant
Key Features of the ZATCA Invoice Format
According to ZATCA regulations, e-invoices must follow specific technical and regulatory standards to ensure compliance.
1. Technical Specifications of the ZATCA Invoice Format
- Approved Formats: Invoices must be issued in XML or PDF/A-3 format, embedding an XML file.
- Electronic Signature: Secure encryption ensures authenticity and prevents tampering.
- QR Code: Contains supplier, buyer, and invoice details.
- Digital Storage: Invoices must be stored for at least six years.
- Integration with FATOORA Portal: Ensures real-time compliance and monitoring.
2. Mandatory Fields in the ZATCA Invoice Format
To comply with regulations, every e-invoice must include the following:
- Supplier name, address, and commercial registration number.
- Tax identification numbers (TIN) for both supplier and buyer (if applicable).
- Itemized details of goods or services, including quantity and unit price.
- Total invoice amount, including VAT.
- Invoice issue date and a unique sequential invoice number.
Tax Invoice vs. Simplified Tax Invoice: What’s the Difference?
There are two main types of e-invoices under the ZATCA invoice format, each serving a distinct purpose.
1. Tax Invoice (B2B)
- Used for business-to-business (B2B) transactions.
- Must include all mandatory invoice details.
- Requires real-time submission to the FATOORA Portal.
- Automatically verified to ensure tax compliance.
2. Simplified Tax Invoice (B2C)
- Issued for business-to-consumer (B2C) sales.
- Contains fewer details than a full tax invoice.
- Must be shared with ZATCA within 24 hours of issuance.
- Includes a QR Code for simplified data access.
Also read: How to Store and Archive E Invoice Data
How to Ensure Compliance with the ZATCA Invoice Format
To fully comply with e-invoicing regulations, businesses must follow these steps:
1. Choose a ZATCA-Compliant E-Invoicing System
Businesses must use an invoicing solution approved by ZATCA to ensure compatibility with regulatory requirements.
2. Verify Technical Readiness for the ZATCA Invoice Format
Ensure the accounting system supports XML or PDF/A-3 invoice formats.
Configure electronic signature settings for security and authenticity.
Include QR Codes in all invoices for seamless verification.
3. Integrate with the FATOORA Portal
The second phase of e-invoicing requires businesses to link their invoicing systems to ZATCA’s FATOORA Portal. This integration enables real-time invoice submission and validation.
4. Train Employees on E-Invoicing Compliance
Employee training is essential to ensure accurate invoice issuance and submission, reducing compliance risks and operational errors.
EZ Integrated: Your Trusted Partner for ZATCA Invoice Format Compliance
EZ Integrated simplifies the e-invoicing compliance process with comprehensive solutions, including:
- ZATCA-approved e-invoicing systems that meet all technical requirements.
- Seamless integration with the FATOORA Portal for real-time invoice transmission.
- Ongoing technical support to ensure uninterrupted operations.
- Employee training programs to streamline e-invoicing implementation.
- Future-Proof Your Business with the ZATCA Invoice Format
Complying with ZATCA invoice format requirements is essential for businesses in Saudi Arabia. It ensures financial accuracy, minimizes errors, and enhances transparency.
As digital transformation accelerates, investing in a robust e-invoicing system is crucial to avoiding penalties and maintaining compliance.
Don’t wait until the deadline! Contact EZ Integrated today to discover the best e-invoicing solution for your business and take the first step toward a smarter, more secure invoicing system.