VAT invoice rules in Saudi Arabia

In Saudi Arabia an invoice must show your VAT number, itemised lines, and VAT separately at the applicable rate — 15%, with 15% applying to most work. A tax invoice showing the VAT number, the amounts in Arabic as well as any other language, and a QR code encoding the seller, the VAT number, the timestamp, the total and the VAT amount.

The Saudi Arabia rule people miss

E-invoicing (FATOORA) is mandatory. Invoices must be generated in a specified structured format, carry a QR code, and for businesses in the integration phase be cleared through ZATCA's platform before they are issued to the customer.

When VAT registration becomes compulsory

Registration is mandatory above SAR 375,000 of annual taxable supplies and optional from SAR 187,500.

Assessed on a rolling twelve months in most systems, not your financial year — which is the detail that catches people out.

Which VAT rate applies to what

There is no reduced rate. The list is standard-rated at 15% or zero-rated — exports, international transport and certain medicines and medical goods.

Bands are defined by what you supply, not by who buys it.

How often you file in Saudi Arabia

Monthly returns where annual supplies exceed SAR 40 million, quarterly below that, due by the end of the month following the period. ZATCA's Fatoora regime requires invoices to be produced by compliant software, and in the integration phase to be cleared or reported to ZATCA — a hand-typed document is not an option.

A worked VAT example

Invoice SAR 4,100 with a 5% discount shown on the document:

• Net before discount: SAR 4,100
• Discount at 5%: −SAR 205
• Taxable value: SAR 3,895
• VAT at 15%: SAR 584.25
• Total due: SAR 4,479.25

The discounted value is what gets taxed — discounts, deposits and advance payments covers where that stops being obvious.

Correcting an invoice in Saudi Arabia

A credit note is itself an electronic invoice under Fatoora: it goes through the same compliant system, carries the same structured fields, and must reference the document it corrects. There is no informal route.

Invoicing outside Saudi Arabia

Services to a non-resident customer are often zero-rated, but only where the customer is outside the GCC implementing states and the benefit of the service is received outside the Kingdom.

Charging tax to a client in another country covers the general shape.

Record keeping in Saudi Arabia

Six years, extended to eleven for capital assets and fifteen for records relating to immovable property. What to hand your accountant at year end.

The universal fields — number, both parties, dates, lines, tax separately, total — apply on top of the local rules above. Rates change: checked to mid-2026, a starting point rather than tax advice; verify against ZATCA.

Set your country once in EstimateBill and the tax is labelled correctly on every invoice after that — GST and GSTIN in India, VAT in the UK, Sales Tax and EIN in the US, across 58 countries.