Saudi Arabia announces 23rd wave of Phase 2 e-invoicing integration

• Saudi Arabia's Zakat, Tax and Customs Authority announced, on 27 June 2025, the criteria for taxpayers to be included in the 23rd wave of Phase 2 e-invoicing integration.
• Taxpayers resident in Saudi Arabia with a taxable turnover exceeding SAR750,000 during calendar year 2022, 2023 or 202, should comply with the Phase 2 e-invoicing requirements no later than 31 March 2026.

Executive summary

On 27 June 2025, Saudi Arabia's Zakat, Tax and Customs Authority (ZATCA) announced on its website that taxpayers resident in Saudi Arabia with a taxable turnover exceeding 750,000 Saudi Riyal (SAR750,000) during calendar year 2022, 2023 or 2024 will fall within the 23rd wave of Phase 2 e-invoicing integration and should comply with the Phase 2 requirements. The ZATCA will notify the affected taxpayers in preparation for linking and integrating their electronic invoicing systems with the ZATCA's e-invoicing platform (Fatoora).

Further, the ZATCA Governor issued Decision No. (1603-99-1446) dated 27/12/1446 AH, which was published in the Official Gazette on 27 June 2025, and mentions that taxpayers coming under the 23rd wave should comply with the Phase 2 e-invoicing requirements between 1 January 2026 and 31 March 2026, inclusive of both dates.

Detailed discussion

Background

On 4 December 2020, the ZATCA introduced e-invoicing in Saudi Arabia, releasing the E-Invoicing Regulations. E-invoicing in Saudi Arabia is being implemented in two phases:

• Phase 1, effective from 4 December 2021, mandates generation of e-invoices and e-notes, including related processing and record keeping.
• Phase 2, effective from 1 January 2023, mandates integration of a taxpayer's system with the ZATCA, along with the transmission of e-invoices and e-notes to the ZATCA. This phase is being implemented in waves. The criteria and timelines for the first 22 waves, which were previously announced, are:

The ZATCA has already notified resident businesses falling under the above waves to comply with Phase 2 of e-invoicing as per their applicable timelines.

ZATCA announcement

Based on the latest announcements, the ZATCA will begin notifying taxpayers who fall within the 23rd wave of Phase 2 e-invoicing integration, to go live within the period between 1 January 2026 and 31 March 2026, inclusive of both dates.

Implications

Resident businesses should comply with the obligations of Phase 2 e-invoicing integration based on the ZATCA notification and undertake the relevant steps in making the required changes in their information technology systems. Taxpayers should comply with the Phase 2 requirements in line with the e-invoicing regulation to preclude possible penalties.

Taxpayers who do not fall within the first 23 waves of Phase 2 e-invoicing integration should monitor future announcements from the ZATCA on the integration timeline period applicable to them in subsequent waves.

For a full listing of contacts and email addresses, please click on the Tax News Update: Global Edition (GTNU) version of this Alert.

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor