The complete guide on financial support for small and medium enterprises for electronic billing

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The Zakat, Tax and Customs Authority has taken many steps aimed at combating the hidden economy and commercial cover-ups, the most important of which was the step of providing financial support to small and medium enterprises after the announcement of the implementation of the electronic invoicing system in the Kingdom.
In this article, we will provide you with a complete guide to electronic invoicing, the fatawa system launched by the Zakat, Tax and Customs Authority, and what is financial support for small and medium enterprises?
What is the financial support for small and medium enterprises for electronic invoicing?
Financial support for small and medium enterprises for electronic invoicing is financial support provided by the Zakat, Tax and Customs Authority in the Kingdom to small and medium enterprises that meet certain conditions in order to help them continue and grow and ensure that they apply the electronic invoicing system in their work.
It is essentially a ministerial order issued at the beginning of 2021 that specifically stipulates that the Zakat, Tax and Customs Authority provides financial support to small and medium enterprises targeted by the electronic invoicing regulation, provided that the annual revenues of these enterprises do not exceed three million riyals (3,000,000).

But, how much is this support worth?
The ministerial order stipulates that financial support may reach 2,500 riyals per facility. This amount is provided to merchants and owners of small and medium enterprises in order to purchase cloud software that helps them issue electronic invoices that are compatible with the conditions of the Zakat, Tax and Customs Authority.

What are the conditions for obtaining electronic billing support?
The Zakat, Tax and Customs Authority has set conditions that must be met by any facility in order to be eligible for financial support for small and medium enterprises for electronic invoicing, which are as follows:
The facility must be subject to the electronic invoicing regulations.
The establishment’s annual revenues do not exceed (3,000,000) three million riyals.
These are the two basic conditions for small and medium enterprises to obtain financial support for electronic invoicing from the Zakat, Tax and Customs Authority in the Kingdom.
Many may ask: What are the establishments subject to the electronic invoicing regulations in the Kingdom of Saudi Arabia?
This is what we will answer in the next paragraph.

What are the establishments subject to the electronic invoicing regulations?
Simply put, establishments subject to the electronic invoicing regulation are any natural or legal person who carries out any electronic activity in the Kingdom of Saudi Arabia and is subject to the application of value-added tax in the Kingdom.
Accordingly, the Zakat, Tax and Customs Authority in the Kingdom provides this financial support to small and medium-sized commercial enterprises in order to help them pay for electronic invoicing application programs in establishments, which in turn helps to maintain their continuity and ensure that they are spared commercial violations related to the digital transformation of invoices.
Now, it is the turn to learn what an electronic invoice is, what the electronic invoicing system (Fatora) is, and the benefits of applying electronic invoicing within various commercial establishments. Let's go!

What is electronic invoicing system (fatora)?
The electronic invoicing system (Fatora) is a system issued by the Zakat, Tax and Customs Authority that aims to support digital transformation in dealing with invoices within various establishments in the Kingdom of Saudi Arabia. It is basically part of the VAT executive regulations.
Through the Fatawa system, we replace paper invoices that are subject to damage, theft, or loss with electronic digital invoices that can be saved and exchanged with complete ease between the merchant and the buyer, as well as retrieved at any time.
This is the electronic invoicing system (Fatura) issued by the Zakat, Tax and Customs Authority. Now, we learn about the benefits of applying it in various establishments and business institutions.

What are the benefits of electronic invoicing application?
Implementing the electronic invoicing system within various establishments brings many benefits, the most important of which are the following:
Reduce and eliminate commercial cover-ups.
Confronting the hidden economy and its dangerous effects on trade and the economy within any country.
Supporting consumer protection and protecting their rights by creating a unified method for storing, documenting and auditing invoices.
Raising levels of compliance with tax obligations.
Digitizing the consumer’s relationship with merchants or the supplier in general and enriching and enhancing the consumer experience.
Based on the need of merchants and owners of small and medium-sized businesses to apply electronic invoicing through cloud programs; In order to issue electronic invoices that are compatible with the conditions of the Zakat, Tax and Customs Authority, the ministerial order for financial support for small and medium enterprises was issued after the Council of Ministers held a session on Tuesday, February 8, 2022.

What is an electronic invoice?
Tax invoice: It is the invoice issued from one facility to another facility, and it contains all the elements of the tax invoice.
An e-invoice is the digital alternative to a printed paper invoice or a manual invoice. It is the same manual invoice, but it is issued and saved electronically or digitally via a cloud system or program that can issue invoices with the requirements indicated by the Zakat, Tax and Customs Authority.
There are two basic types of electronic invoice, which are as follows:
First: the tax invoice.
Tax invoices are those invoices issued by an establishment to another establishment or institution and include all elements of the tax invoice.
But, what are the elements of a tax bill? This is what we will learn about below.
Tax invoice items
The invoice title is (Tax Invoice) for invoices between one facility and another.
Invoice issuance date.
Supplier name.
Tax number if the buyer is registered for VAT.
Invoice serial number.
Store address.
Supplier tax number.
Added tax rate/value added tax amount.
Second: The appropriate tax invoice


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