E-Invoicing in the Kingdom of Saudi Arabia (KSA)
The Zakat, Tax and Customs Authority (ZATCA) recently announced that e-invoicing will be mandatory in the Kingdom of Saudi Arabia w.e.f 4 December 2021. Marg ERP is a qualified e-invoicing solution provider in the Kingdom of Saudi Arabia compliant with all ZATCA rules & regulations.
In 2018 VAT was implemented in the Kingdom of Saudi Arabia with a standard rate of 5% and specific limited transactions designated as zero-rated or exempt. VAT with hiked to 15% in the mid-2020 to mitigate the effects of the Covid Pandemic. If the officials to be believed the introduction of e-invoicing is the next big change in the VAT system that will take effect from 4 December 2021.
With the introduction of e-invoicing, the government intends to streamline the invoicing process, improve the tax revenue of KSA & boost VAT compliances. E-invoicing ensures that uniform electronic formats are used for invoicing that can be easily read by the machine, which increases the interoperability and readability of invoices. This new introduction will also help the tax officials to identify the fake tax authorities & match input & output tax credits on the ZATCA portal.
Let us now discuss e-invoicing in detail.
What is E-invoicing under ZATCA Protocol?
E-invoicing is simply an authentication technique in which the electronically generated invoices are uploaded & verified from the ZATCA portal. The invoices are first generated in uniform format from an authorized e-invoicing / billing software. Then the e-invoices are uploaded on the ZATCA portal. The e-invoices are sent to the buyers after authenticating from the ZATCA portal in a uniform machine-readable format. This helps in the easy reconciliation of books. These invoices include all details as written in the paper invoice like date, customer details, product details, service details, invoice amount, VAT amount. All residents in Saudi Arabia who issue tax invoices are subjected to e-invoicing mandatorily.
E-invoicing creates a common database for the tax authorities, reduces the possibilities of errors, which helps in tracking all the transactions. This database includes B2B, B2G, & B2C on a real-time basis. It also reduces tax audits by the tax authorities.
How ZATCA E-invoicing will be implemented?
The Government of Saudi Arabia has decided to implement the e-invoicing system in two phases.
- The phase will begin on 4 December 2021. By 4 December 2021, all taxpayers must equip themselves with all necessary tools, they should be able to able to create, edit & store e-invoices in the prescribed format before the deadline.
- In the second phase that begins on 1st January 2023, all the e-invoicing portal that these taxpayers use must be integrated with ZATCA’s e-invoicing portal for Continuous Transaction Control (CTC) to work. In this phase, the e-invoices must be authenticated from the ZATCA portal by the seller before sending them to the buyers.
How Marg ERP will help?
In an e-invoicing system the invoices, debit notes, credit notes are submitted to the ZATCA portal in the specified format for authentication. After successful authentication, the Universally Unique Identifier Number (UUID) and a QR code is generated and added to the invoice. This marks the invoice as a valid e-invoice that the seller can give to the buyer. Making it easy for you, Marg ERP is incorporated with all the necessary features. Marg ERP will help you simplify your entire e-invoicing process. Let us discuss how?
Free Download E-invoicing Software
You can simply implement Marg ERP software in your business with our on-site support team. Just enabling the e-invoicing feature in Marg ERP, you will get all the necessary features to upload invoices directly to the ZATCA portal. You can also customize invoice design with QR code & company branding.
Safe & Secure
As per the ZATCA guidelines, your invoices can’t be accessed by any anonymous person. You can set the user rights as per your convenience. You can set the password & admin rights.
Manage Single or Multiple e-invoices
Marg ERP lets you create and manage error-free multiple e-invoices effectively from a single platform with all mandatory fields. The transactions are authenticated during creation for errors, violation, incorrect data entry, calculation errors etc.
- You can also push multiple or bulk invoices to the ZATCA portal in bulk for authentication at one go. You will get authenticated ready e-invoices in a few seconds.
- You can easily edit or rectify the error in an e-invoice with Marg ERP.
You also get to maintain records of all business transactions, download them & archive them.
Want to see how it works?
The implementation of e-invoicing in Saudi Arabia will see many reformations in future. It will be a game changer for business transactions. It is time now, you must start preparing for e-invoicing. Marg ERP offers easy implementation & helps you generate e-invoice in one click. You can schedule a demo for Marg ERP & see how it actually works.
Also, Marg ERP provides an on-site hand holding service. Offline or online do it the way you like.