The comprehensive guide to the third phase of the e- invoice.

The Zakat, Tax, and Customs Authority announced three phases of the electronic invoice, the form of which is not different in the third phase from the previous two.

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The Kingdom of Saudi Arabia has merged the Zakat, Tax, and Customs Authority with the General Authority of Zakat and Tax to provide electronic invoices in the Kingdom.

On September 17, 2020, a draft amendment was published in accordance with the Value Added Tax (VAT) Executive Regulation.

The draft amendment covered all rules of electronic invoicing programs, including the third phase and all other stages.

The form of the electronic invoice in the third stage is not much different from the previous two stages.

Starting in 2021 and 2022, all businesses with sales volumes ranging from SAR 250 to SAR 500 million will be at this stage.

In this article, we will get to know all of this, and we will answer most of the questions in your mind. Follow with us.

To succeed in this, Zakat and the Income Authority implemented this system in two phases: the first phase and the second phase.

Is your establishment ready to move on to the second Phase? Try Qoyod now for free for 14 days.

What is an e-invoice?

It is a procedure that converts traditional paper invoices to electronic ones.

Any electronic invoicing system allows the processing, issuance, and exchange of credit and debit notes and invoices between buyers and sellers in a structured electronic system.

All provisions relating to the tax invoice in the value added tax legislation are applied to that invoice, and the Zakat, Tax, and Customs Authority will impose numerous fines if not all comply with those provisions.

 Why is an e-tax invoice being submitted in Saudi Arabia?

Saudi Arabia is striving to move towards an efficient digital environment.

so it has created electronic tax invoices instead of traditional paper ones to facilitate financial transactions for companies and so that they can work more efficiently.

As well as creating a common database for the audit process and quickly detecting fraudulent activity.

Thus, reducing the pace of the audit process and tracking transactions in real time, which will reflect positively on the state and make it progress day by day.

 What information is in e-invoicing?

The information in e-invoices varies depending on the type of services or goods for which they are invoiced.

As well as the nature of the transaction and the applicable regulations and laws, but often include important and basic information, namely:

  • The date of issuance of the invoice
  • Tax information, such as VAT and sales taxes, and also the amount of each tax
  • ID for the invoice.
  • Customer information, including name, address, and contact information belonging to the company or person to whom the invoice will be sent.
  • The total amount due for the invoice, including taxes
  • Description of the services or goods that are billed and all product details, such as price, quantity, etc.
  • Payment information and terms, such as how and when to pay the bill, etc.
  • Mention any relevant reference information, such as contract numbers and purchase order numbers.
  • Additional relevant information, such as a transfer address, shipping address, and billing person,


Which documents are not classified as an electronic invoice? 

There are several documents that we cannot classify as  electronic invoices, as there is no such thing as an electronic invoice at all.

Examples of such documents include:

  • Unstructured invoice on an email or web page.
  • Scanned paper invoice in whatever format, whether PDF or JPG.
  • Unstructured invoices issued in Word or PDF format

The form of the electronic invoice in the third stage

The Zakat, Tax, and Customs Authority in Saudi Arabia has announced the third batch of the electronic invoice as part of its second phase.

All companies that register at the Tax Center for Major Financiers starting May 15, 2021, are required to issue electronic tax invoices as a third stage for services or the sale of goods.

The Authority clarified that starting October 1, 2023, companies with a turnover between SAR 250 and SAR 500 million must complete the POS and ERP systems with the invoice portal of the Zakat, Tax, and Customs Authority.

How do store owners apply any e-billing?

Store owners can apply electronic invoicing to their businesses through accounting software providers.

Such as Qoyod, the best accounting software, that will generate a QR code that you can use with each invoice for a small price, so you don’t have to pay any additional costs then.

However, do not write electronic invoices through text editing programs, manually, or using accounting software that does not meet your requirements; this will negatively affect your business.

The Zakat, Tax, and Customs Authority indicated that the form of the electronic invoice cannot be deleted after its issuance, no matter what happens.

For those who do not know, the QR code is a stamp of black and white squares that are automatically read by the camera of smart devices or through a dedicated scanner to verify the validity of invoices.

The conclusion

The new e-invoice format has facilitated its financial transactions.

Therefore, three stages of the invoice have been developed; each stage differs from the other in the date of its application, in the business and the volume of sales that fall under it, etc.

But there are several similar pieces of information in the three stages, the most important of which are customer information and tax information, as well as the date of issuance of the invoice, the invoice ID, etc.Issuing an electronic invoice requires many things that worry a person.

Because we at Qoyod are always proactive in helping you, we can issue invoices for you at the click of a button.

At the end of this article, we would like to show the importance of Qoyod, which is the best integrated cloud accounting program in the field of accounting.

It issues all electronic invoice systems, and it also offers a point of sale system at prices that suit everyone.

So it’s the best of all, despite the fact that there are plenty of other electronic billing programs.

What are you waiting for? Try Qoyed now for free for 14 days.

Enjoy watching your business evolve day by day, moving to the next level to compete with other global businesses.


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