Complyance Approved by ZATCA for Phase 2 E-Invoicing in Saudi Arabia

Riyadh, Saudi Arabia — March 5, 2025 — Complyance has been approved by the Zakat, Tax and Customs Authority (ZATCA) as a compliant solution provider for Phase 2 (Integration Phase) of Saudi Arabia's mandatory e-invoicing program, Fatoorah. The approval confirms that Complyance's platform meets all of ZATCA's technical, security, and data requirements for real-time invoice clearance and reporting.

This makes Complyance one of the approved platforms that Saudi businesses can use to meet their Phase 2 obligations as ZATCA expands the mandate across taxpayer groups.

What Is ZATCA Phase 2 E-Invoicing?

ZATCA Phase 2, also called the Integration Phase, is the second stage of Saudi Arabia's mandatory e-invoicing program (Fatoorah). It requires businesses to integrate their invoicing systems directly with ZATCA's platform for real-time or near-real-time invoice clearance.

Saudi Arabia's e-invoicing mandate has two phases:

• Phase 1 (Generation Phase — since December 2021): Required businesses to generate and store invoices in a structured electronic format
• Phase 2 (Integration Phase — rolling out in waves since January 2023): Requires businesses to submit invoices to ZATCA's Fatoorah platform in real-time for clearance before the invoice is considered legally valid

ZATCA is onboarding businesses to Phase 2 in waves, based on annual revenue thresholds. Each wave is announced with a minimum 6-month notice period.

What Does ZATCA Phase 2 Require?

Phase 2 is significantly more complex than Phase 1. Requirements include:

• Real-time API integration with ZATCA's Fatoorah portal for invoice clearance (B2B) and reporting (B2C)
• Cryptographic stamping — every invoice must be digitally signed using a ZATCA-issued cryptographic stamp
• QR code generation with ZATCA-defined fields encoded in TLV (Tag-Length-Value) format
• UUID assignment — each invoice must carry a universally unique identifier
• XML compliance — invoices must be submitted in ZATCA's UBL 2.1-based XML format with specific Saudi extensions
• Sequential invoice numbering with specific formatting requirements

How Complyance Handles ZATCA Phase 2 Compliance

Complyance's ZATCA-approved platform provides:

1. Direct API integration with ZATCA's Fatoorah portal for both clearance (B2B standard invoices) and reporting (B2C simplified invoices)
2. Automated cryptographic stamping and digital signature generation per ZATCA's specifications
3. QR code generation fully compliant with ZATCA's TLV encoding standard
4. Pre-submission validation that catches formatting errors, missing fields, and calculation discrepancies before invoices reach ZATCA
5. Real-time clearance status tracking with automatic retry handling for failed or timed-out submissions
6. Support for all ZATCA document types: standard tax invoices, simplified tax invoices, credit notes, and debit notes
7. Sandbox testing environment for businesses preparing for their Phase 2 wave

ZATCA Phase 2 Wave Preparation

ZATCA onboards businesses to Phase 2 in waves. Complyance helps businesses prepare ahead of their designated wave by:

• Setting up API connections and testing in ZATCA's sandbox environment
• Running validation on historical invoice data to identify compliance gaps
• Training finance teams on the new clearance workflow
• Providing go-live support with dedicated compliance engineers during the transition period

Frequently Asked Questions

Is Complyance approved by ZATCA for Phase 2 e-invoicing?

Yes. Complyance is approved by Saudi Arabia's Zakat, Tax and Customs Authority (ZATCA) as a compliant solution provider for Phase 2 (Integration Phase) of the Fatoorah e-invoicing program.

What is ZATCA Fatoorah Phase 2?

ZATCA Fatoorah Phase 2, also called the Integration Phase, requires Saudi businesses to integrate their invoicing systems with ZATCA's platform for real-time invoice clearance. Every B2B invoice must be cleared by ZATCA before it is considered legally valid. B2C invoices must be reported within 24 hours.

Who needs to comply with ZATCA Phase 2?

All VAT-registered businesses in Saudi Arabia will eventually need to comply with Phase 2. ZATCA is rolling out the requirement in waves based on annual revenue. Check ZATCA's official announcements or use Complyance's free compliance checker at complyance.io to confirm your wave.

What is the penalty for not complying with ZATCA e-invoicing?

ZATCA can impose penalties starting at SAR 5,000 for first-time violations of e-invoicing requirements, with increasing penalties for repeated non-compliance. Penalties cover failure to issue e-invoices, failure to include mandatory fields, and failure to integrate with ZATCA's systems by the designated deadline.

How long does it take to integrate with ZATCA Phase 2 through Complyance?

Most businesses complete their ZATCA Phase 2 integration with Complyance within 2-4 weeks, including sandbox testing and validation. Businesses with standard ERP setups using Complyance's pre-built connectors can go live even faster.

What is the difference between ZATCA Phase 1 and Phase 2?

Phase 1 (Generation Phase) required businesses to generate invoices in electronic format and store them digitally. Phase 2 (Integration Phase) goes further — requiring real-time submission of invoices to ZATCA's Fatoorah platform for clearance (B2B) or reporting (B2C) before invoices are considered legally valid.

About Complyance

Complyance is a global e-invoicing platform built for companies with development teams. It plugs into existing billing systems through a single API and handles invoice generation, validation, submission and archival across 100+ countries, so businesses can stay compliant without rebuilding their stack.

Website: complyance.io

Contact: contact@complyance.io