Saudi Arabia’s e-invoicing rollout has reached smaller businesses. ZATCA has announced Wave 25 of Phase 2 (the Integration Phase), covering taxpayers whose VAT-able revenue exceeded SAR 187,500 in 2022, 2023, 2024 or 2025. These businesses must integrate their e-invoicing systems with ZATCA’s Fatoora platform by 1 February 2027.
That threshold is much lower than earlier waves, which means thousands of small and medium businesses that have never dealt with system integration now need to. Many are running basic accounting software, spreadsheets or POS systems that weren’t built for Phase 2.
This guide explains who’s included in Wave 25, what Phase 2 requires, how integration works, and how businesses using ERPNext or Odoo can get ready in time.
Key Takeaways
Wave 25 covers taxpayers with VAT-able revenue above SAR 187,500 in any of 2022, 2023, 2024 or 2025.
The deadline to integrate with Fatoora is 1 February 2027.
ZATCA notifies taxpayers in each wave at least six months in advance, by email and SMS.
Phase 2 requires structured XML invoices, cryptographic stamps and integration with Fatoora.
Standard tax invoices (B2B) must be cleared by ZATCA; simplified invoices (B2C) must be reported within 24 hours.
Every device or system that issues invoices must be onboarded and receive a CSID.
What Is ZATCA Phase 2?
ZATCA’s e-invoicing program has two phases:
Phase | Name | What it requires |
|---|---|---|
Phase 1 | Generation Phase (since December 2021) | Issue electronic invoices from a compliant system, with a QR code on simplified invoices |
Phase 2 | Integration Phase (in waves since 2023) | Integrate your invoicing system with ZATCA’s Fatoora platform, with clearance or reporting of every invoice |
Phase 2 is rolled out in waves, starting with the largest businesses and moving down to smaller ones. Each wave is defined by a revenue threshold, and taxpayers are notified in advance.
Who Is Included in Wave 25?
You’re in Wave 25 if your VAT-able revenue exceeded SAR 187,500 in any one of these years:
2022
2023
2024
2025
It’s the first wave to count 2025 revenue. Because the threshold is low, Wave 25 covers a large number of small businesses, including shops, restaurants, contractors, service providers and small distributors.
How recent waves compare
Wave | Revenue threshold | Integration deadline |
|---|---|---|
Wave 23 | SAR 750,000 | First half of 2026 |
Wave 24 | SAR 375,000 | 30 June 2026 |
Wave 25 | SAR 187,500 | 1 February 2027 |
How will I know I’m included?
ZATCA notifies targeted taxpayers at least six months before their integration date, through the email and mobile number registered with ZATCA. If you think you’re above the threshold but haven’t received a notification, check your registered contact details and confirm your status with ZATCA directly.
Don’t wait for the notification to start preparing. If your revenue crossed SAR 187,500 in any of those years, plan as though you’re in Wave 25.
What Phase 2 Requires
1. A compliant e-invoicing solution
Your system must generate invoices in XML format (or PDF/A-3 with embedded XML) following ZATCA’s specifications, including:
A UUID (unique identifier) for every invoice
A cryptographic stamp
An invoice hash chained to the previous invoice
A QR code on simplified invoices
2. Onboarding with Fatoora
Every unit or device that issues invoices under your VAT number must be onboarded:
Log in to the Fatoora portal
Generate a one-time password (OTP) for each unit
Enter the OTP in your e-invoicing solution
Receive a Cryptographic Stamp Identifier (CSID)
Without a valid CSID, a device can’t issue compliant Phase 2 invoices.
3. Clearance and reporting
Invoice type | Used for | What happens |
|---|---|---|
Standard tax invoice | Business-to-business (B2B) | Sent to ZATCA for clearance before you share it with the buyer |
Simplified tax invoice | Business-to-consumer (B2C) | Shared with the customer immediately and reported to ZATCA within 24 hours |
Credit and debit notes follow the same rules as the invoices they relate to.
4. Testing before go-live
ZATCA provides a sandbox, an SDK and a validation tool so you can test invoices before going live. Every invoice type you issue should be tested first.
Why Wave 25 Businesses Often Struggle
Their software isn’t Phase 2-ready. Basic accounting tools, older desktop systems and many local POS systems don’t support clearance, cryptographic stamps or CSIDs.
Multiple devices. Businesses with several branches, cash counters or POS terminals must onboard each one.
Messy master data. Missing customer VAT numbers, addresses or item tax categories cause invoices to fail validation.
B2B and B2C together. Many small businesses issue both standard and simplified invoices and need both flows working.
Leaving it late. Software changes, onboarding and testing take weeks, not days, especially close to a deadline when providers are busy.
Step-by-Step: Getting Ready for 1 February 2027
Step 1: Confirm you’re in Wave 25 (now)
Check your VAT-able revenue for 2022 to 2025. If any year exceeded SAR 187,500, you’re likely included. Check your ZATCA notifications.
Step 2: Review your current system (now)
Ask your software provider directly: “Does our system support ZATCA Phase 2 integration, including clearance, reporting and CSID onboarding?” If the answer is unclear, plan to upgrade or switch.
Step 3: Choose your solution (November)
Options include upgrading your existing system, adding a Phase 2 integration layer, or moving to an ERP with built-in ZATCA compliance.
Step 4: Clean your data (November to December)
Customer VAT numbers and addresses for B2B buyers
Item tax categories and VAT rates
Branch and device details
Step 5: Onboard and test (December)
Onboard each device in the sandbox, test every invoice type (standard, simplified, credit and debit notes) and fix validation errors.
Step 6: Go live (January 2027)
Onboard your production devices, issue live invoices and monitor clearance and reporting responses daily. Aim to be live before the deadline, not on it.
ZATCA Phase 2 for ERPNext Users
ERPNext is widely used in Saudi Arabia, and it can meet Phase 2 requirements with a ZATCA compliance app. A typical setup includes:
Requirement | How it works in ERPNext |
|---|---|
XML invoice generation | Sales invoices converted to ZATCA-compliant XML automatically |
UUID, hash and cryptographic stamp | Generated for every invoice |
CSID onboarding | Each company, branch or POS profile onboarded with its own CSID |
Clearance (B2B) | Standard invoices sent to ZATCA before being shared |
Reporting (B2C) | Simplified invoices and POS sales reported within 24 hours |
QR code | Printed on simplified invoices |
Credit and debit notes | Linked to original invoices and cleared or reported |
Monitoring | Status of every submission tracked, with failed invoices flagged |
Because the compliance layer sits inside ERPNext, invoices are generated from the same data as your sales, stock and accounts, with no re-entry.
ZATCA Phase 2 for Odoo Users
Odoo also supports Saudi e-invoicing through its Saudi localization. Before your deadline:
Confirm your Odoo version and edition support Phase 2 clearance and reporting
Check that every branch and POS is onboarded with its own CSID
Test both standard and simplified invoices in the sandbox
Comparing platforms? See our ERPNext vs Odoo comparison.
What Happens If You Miss the Deadline?
Businesses that don’t comply with e-invoicing requirements can face warnings and financial penalties, which increase with repeated violations. Beyond penalties, B2B customers increasingly expect cleared invoices to claim their input VAT, so non-compliance can also cost you business. Check ZATCA’s current penalty rules and confirm with your tax advisor.
Wave 25 Readiness Checklist
Revenue checked against SAR 187,500 for 2022 to 2025
ZATCA notification checked (email and SMS)
Software confirmed Phase 2-ready, or replacement planned
Customer VAT numbers and addresses cleaned
Item tax categories reviewed
Every invoicing device and branch listed
Sandbox onboarding and testing completed
Standard, simplified, credit and debit notes tested
Production CSIDs issued for every device
Daily monitoring of clearance and reporting in place
Live before 1 February 2027
Frequently Asked Questions
What is ZATCA Wave 25?
Wave 25 is the latest group of taxpayers required to join Phase 2 (Integration Phase) of ZATCA e-invoicing. It covers businesses with VAT-able revenue above SAR 187,500 in any of 2022, 2023, 2024 or 2025.
What is the Wave 25 deadline?
Wave 25 taxpayers must integrate their e-invoicing systems with ZATCA’s Fatoora platform by 1 February 2027.
How do I know if my business is in Wave 25?
Check whether your VAT-able revenue exceeded SAR 187,500 in any year from 2022 to 2025. ZATCA also notifies included taxpayers at least six months in advance through their registered email and mobile number.
What is a CSID?
A Cryptographic Stamp Identifier is issued by ZATCA when you onboard an invoicing device or system through the Fatoora portal. Every device that issues invoices needs one.
What is the difference between clearance and reporting?
Standard tax invoices (B2B) must be cleared by ZATCA before they’re shared with the buyer. Simplified invoices (B2C) are shared immediately and reported to ZATCA within 24 hours.
Can ERPNext comply with ZATCA Phase 2?
Yes. With a ZATCA compliance app, ERPNext can generate compliant XML invoices, onboard devices with CSIDs, and handle clearance and reporting.
Does Phase 1 still apply?
Yes. Phase 1 requirements, such as electronic invoices and QR codes on simplified invoices, continue to apply alongside Phase 2.
Get ZATCA Wave 25 Ready with Bizloom ERP
Bizloom ERP helps businesses in Saudi Arabia implement ZATCA-compliant e-invoicing on ERPNext, working remotely with teams across the Kingdom. We can:
Review whether your current system is Phase 2-ready
Implement ERPNext with ZATCA Phase 2 compliance
Onboard every branch, device and POS with CSIDs
Test standard and simplified invoices in the sandbox
Clean customer and item data for successful validation
Monitor clearance and reporting after go-live
Learn more about our ZATCA e-invoicing services and ERP in Saudi Arabia, or read our complete guide to ZATCA e-invoicing, Phase 1 and Phase 2. Operating across the Gulf? See our guides to UAE e-invoicing and Oman’s Fawtara.
In Wave 25 and not sure your system is ready? Message us on WhatsApp and we’ll check your setup. Ask on WhatsApp
Want a full readiness check? Book a Free ERP Assessment with Bizloom ERP.