Following the release of the Electronic Invoicing (e-invoicing) draft regulations in September 2020, the General Authority of Zakat and Tax (GAZT) has issued the final regulation on its website on 4 December 2020 after the approval of its board of directors. The regulations entered into force on the day of publication and must be applied within the next 12 months, i.e. by 4 December 2021.

E-invoicing regulations are integral and complementary to the Value Added Tax (VAT) Implementing Regulations and apply to all taxpayers who are subject to VAT. The new regulations define the terms, requirements, and conditions related to electronic invoices. For example, confirming the definition of an electronic invoice to be a tax invoice issued electronically through electronic means, which excludes scans or copies of invoices. 

His Excellency, the Governor of GAZT will have the power to issue the necessary decisions and instructions to implement the provisions of the e-invoicing regulations.

Along with the regulations, GAZT has issued guidelines and FAQs, which provide further detail on the application of e-invoicing. Further guidance on the specifications for issuing and maintaining invoices and debit notices and on connecting billing and notification systems, will be published within 180 days from the date of publishing the regulations.

The move to e-invoicing is intended to improve the efficiency of the filing process for taxpayers. The aim of the Authority is also to increase compliance with tax laws and regulations and to improve the Kingdom’s alignment with, and adherence to, international standards.

We shall keep you up to date on any further developments. In the meantime, our teams are available to discuss the regulations and assess their impact on your business.