E-invoicing in Saudi Arabia is no longer something to prepare for — it’s something to run
Phase 1 (Generation) has applied to every resident VAT-registered business since December 2021, and Phase 2 (Integration) has been rolling out wave by wave since January 2023, pulling more businesses into real-time integration with ZATCA’s Fatoora platform as the revenue threshold keeps falling.
Altivate, an SAP Gold Partner, implements SAP Document and Reporting Compliance (SAP DRC) on SAP S/4HANA and SAP ECC — and operates it.
Your invoices clear in real time, your reporting lands inside the 24-hour window, and your compliance holds wave after wave.
ZATCA is one deadline of several. Our research sets out the three statutory clocks a multi-country rollout runs against.
Where ZATCA e-invoicing stands today
Since 4 December 2021, Phase 1 has required every resident VAT-registered taxpayer to generate invoices electronically through a compliant e-invoicing solution — carrying the mandatory VAT fields, a QR code on simplified (consumer) invoices, sequential numbering, and tamper-proof storage. There are no waves and no exemptions by size: paper, handwritten, and scanned invoices are already non-compliant, for everyone. The structured XML, UUID, and cryptographic stamp arrive with Phase 2.
Phase 2 is where the moving target lives. Since January 2023, ZATCA has been integrating taxpayers directly with its Fatoora platform in enforcement waves, selected by VAT-taxable revenue. Once your wave arrives, e-invoicing stops being a document format and becomes a live system integration: standard invoices must be cleared by ZATCA in real time before they ever reach your buyer, and simplified invoices must be reported within 24 hours. An invoice that fails clearance is not a formality problem — it’s an invoice you cannot legally issue.
The threshold keeps falling
Phase 2 began with the Kingdom’s largest taxpayers. By Wave 23, businesses with VAT-taxable revenue above SAR 750,000 were required to integrate (deadline 31 March 2026); Wave 24 halved that to SAR 375,000 (deadline 30 June 2026). Each wave is announced at least six months ahead — and every wave so far has reached further down the revenue scale. If your business hasn’t been named yet, the trend says it will be: check your current wave status on zatca.gov.sa, or ask us to check it with you.
Clearance and reporting — the two Phase 2 models
Clearance — standard invoices (B2B / B2G)
Every standard tax invoice is transmitted to ZATCA’s Fatoora platform and cleared in real time, before it reaches the buyer. The cleared invoice comes back cryptographically stamped — only then is it a legal invoice you can send.
Reporting — simplified invoices (B2C)
Consumer-facing simplified invoices are issued at the point of sale with their QR code, then reported to Fatoora within 24 hours of issuance. Miss the window at volume — across stores, branches, and channels — and the backlog is a compliance finding.
Whichever model applies, every Phase 2 invoice carries the same technical anatomy:
SAP DRC — the SAP answer to ZATCA
SAP’s current product for ZATCA compliance is SAP Document and Reporting Compliance (SAP DRC) — the successor to SAP Document Compliance and the earlier eDocument solutions, built on the eDocument framework. Its Saudi localization implements both Phase 2 models natively: real-time clearance for standard invoices and 24-hour reporting for simplified ones. SAP DRC generates the UBL XML, manages UUIDs and the invoice hash chain, signs simplified invoices under your ZATCA-issued CSID, submits standard invoices to Fatoora for real-time clearance, and connects to the platform through SAP Cloud Integration — whether your invoices originate in SAP S/4HANA → or SAP ECC. Compliance stops being a bolt-on middleware project and becomes part of how your SAP issues an invoice.
What Altivate delivers
ZATCA compliance fails in two ways: an integration that never quite gets certified, or one that goes live and then quietly degrades — rejections pile up, a CSID lapses, a new wave lands on a subsidiary nobody assessed. Altivate’s service covers both ends: implement it right, then keep it right.
Wave & compliance assessment
Where you actually stand: wave exposure by revenue threshold across your entities, an inventory of standard vs simplified invoice flows, and a gap analysis of your SAP landscape against Phase 2 requirements — with a sequenced remediation plan.
SAP DRC implementation
eDocument configuration on SAP S/4HANA or SAP ECC, UBL XML mapping for your invoice types, CSID onboarding and cryptographic-stamp setup, QR generation, Fatoora connectivity via SAP Cloud Integration, and end-to-end testing before your deadline.
Clearance & reporting operations
Real-time clearance for B2B and B2G invoices, 24-hour reporting for B2C — with rejection handling, correction, and resubmission worked as an operational discipline, so a clearance failure never becomes a stopped billing run.
Monitor & stay ahead
Ongoing clearance-status and rejection monitoring, CSID and certificate lifecycle care, watch on new ZATCA wave announcements and rule changes, and adoption of SAP DRC updates — compliance as a running service, not a finished project.
AI on the compliance stream
Phase 2 turns invoicing into a live data stream — clearance statuses, rejection codes, response times, volumes by entity and channel. Altivate, whose differentiator is AI on top of deep SAP, puts that stream to work: AI-assisted triage of clearance exceptions, anomaly detection on rejection spikes before they threaten the 24-hour window, and pattern analysis that turns recurring rejections into permanent master-data and mapping fixes. Drawing on Altivate’s own AI practice — Altivate AI Labs and our forward-deployed AI engineers — compliance monitoring gets sharper every month, under controls certified to ISO 27001.
Delivered from inside the Kingdom
SAP Gold Partner. ZATCA e-invoicing delivered by the same Altivate team that implements, integrates, and runs SAP across Saudi Arabia and the Gulf every day.
Altivate delivers SAP DRC as part of a full SAP practice — S/4HANA implementations, ECC estates, integrations, and managed operations — with consultants working in Arabic and English who know both the SAP localization and the Saudi regulatory context it serves. Delivery is governed under ISO 27001 for information security — which matters when the system in question touches every invoice your business issues.
And because clearance never sleeps, most clients don’t run it alone: ZATCA compliance folds naturally into Altivate’s SAP Application Management Services → — the same SLAs, monitoring, and named consultants covering your e-invoicing flows alongside the rest of your SAP estate.
Read more
If your integration wave has arrived, if rejections are creeping up, or if the falling threshold is about to reach entities you haven’t assessed yet — the fastest way forward is a focused conversation about your invoice flows, your SAP landscape, and what compliant looks like for you.
Talk to our SAP DRC / ZATCA team →
