How does ZATCA handle export and zero-rated invoices?

Export transactions remain subject to Saudi e-invoicing requirements. A Saudi VAT-registered business making a supply to a foreign customer must generate the appropriate electronic invoice, even when the transaction qualifies for zero-rating. The invoice must follow the applicable ZATCA requirements and use the correct invoice type and tax treatment.

For Phase 2, the invoice should include the appropriate export indicator and the applicable VAT category and exemption reason code. ZATCA's XML Implementation Standard identifies specific reason codes for zero-rated exports of goods and services. Zero-rating must be supported by the relevant VAT rules and evidence; it should not be applied merely because the customer is outside Saudi Arabia.

Standard Tax Invoices must be submitted to FATOORA for clearance before being issued to the buyer. The applicable reporting process should be followed if the transaction requires a Simplified Tax Invoice.

Key points

• Export transactions are within the e-invoicing framework.
• Zero-rated supplies still require the appropriate electronic invoice.
• Use the correct invoice type and export indicator.
• Apply the appropriate VAT category and reason code.
• Retain evidence supporting the zero-rated treatment.
• Standard Tax Invoices require clearance through FATOORA.
• Confirm the VAT treatment against the applicable Saudi VAT rules.