What are the penalties for ZATCA e-invoicing non-compliance?

ZATCA can impose penalties for violations such as failing to issue and retain electronic invoices, failing to keep invoices in the required format, not reporting a malfunction that prevents invoice issuance, omitting a mandatory QR code, using prohibited system functions, or deleting or modifying invoices after issuance. The penalty depends on the type and repetition of the violation.

ZATCA's published VAT violations and penalties guide describes a graduated approach for e-invoicing violations: an alert or notice for the first violation, followed by fines of SAR 1,000, SAR 5,000, SAR 10,000 and SAR 40,000 for subsequent violations, according to the applicable violation and repetition rules. These amounts should not be treated as a single universal penalty for every e-invoicing issue. Other VAT violations may have separate penalties.

Businesses should review the specific violation, the applicable penalty schedule and any current ZATCA guidance before determining the financial exposure.

Key points

• Penalties depend on the type and repetition of the violation.
• Violations can include failure to issue or retain electronic invoices.
• Deleting or modifying issued invoices can lead to penalties.
• QR-code and system-security violations may also be penalised.
• ZATCA's published guide describes escalating penalties for repeated violations.
• Other VAT violations may have separate penalty rules.
• Review the specific violation and current official guidance before calculating exposure.