ZATCA Phase 2
Compliance
with ERPNext
The Saudi
Guide
The Wave 24 integration deadline is 30 June 2026. If your business invoiced more than SAR 750,000 in 2022 or 2023, the Zakat, Tax and Customs Authority (ZATCA) expects every tax invoice to be cleared through the Fatoora platform — cryptographically stamped, UBL 2.1 formatted, and stored. MAAS Consult makes that switch painless with ERPNext.
Wave timeline: from Wave 1 to Wave 24
ZATCA publishes each wave with a revenue threshold and a fixed go-live date. Here is the compressed roadmap businesses in Saudi Arabia have been navigating since 2023.
Tip — ZATCA's official Wave notification lands six months before the cutover. If you have not had a letter yet, you are not safe: the next wave will sweep up almost every remaining VAT-registered SME in the Kingdom.
The penalty table no Saudi CFO wants to see
Non-compliance with Phase 2 is treated as a tax violation under the VAT Implementing Regulations. Fines escalate quickly with repeat offences, and ZATCA can suspend your ability to issue invoices.
| VIOLATION | 1ST OFFENCE | REPEAT OFFENCE | SEVERITY |
|---|---|---|---|
| Failure to issue or archive e-invoices | SAR 1,000 | Up to SAR 50,000 | Critical |
| Failure to include the QR code on simplified invoices | SAR 1,000 | Up to SAR 40,000 | High |
| Failure to notify ZATCA of system malfunction | SAR 1,000 | Up to SAR 10,000 | Medium |
| Deleting or amending issued e-invoices | SAR 5,000 | Up to SAR 50,000 | Critical |
| Missing mandatory invoice fields (VAT no., timestamp, etc.) | SAR 1,000 | Up to SAR 10,000 | Medium |
How ERPNext makes Phase 2 boring (in a good way)
ERPNext is a full open-source ERP suite. When configured by a ZATCA-experienced partner, it handles every Phase 2 requirement inside the same software your team already uses for invoicing, VAT returns and inventory — no separate "compliance tool" to babysit.
UBL 2.1 XML generation
Every Sales Invoice is serialised into the exact XML schema ZATCA expects, with mandatory fields auto-populated from the customer and item masters.
CSID & cryptographic stamp
Onboarding generates your Cryptographic Stamp Identifier through the Fatoora compliance API. ERPNext signs every invoice with your private key, automatically.
TLV-encoded QR code
The base64-encoded TLV QR (Seller, VAT, Timestamp, Total, VAT amount, Hash, Signature, Public Key) is printed on every PDF and POS receipt.
Real-time clearance & reporting
B2B Standard invoices are sent for clearance; B2C Simplified invoices are reported within 24 hours — both happen as background jobs the user never sees.
Bilingual print formats
Arabic-English invoice layouts that respect ZATCA's mandatory fields, right-to-left typography and your brand identity.
5-year audit archive
Hashed UBL XML and the ZATCA response payload are stored against each invoice for the full 5-year retention period — searchable in one click.
TallyPrime & ZATCA — what changes for Tally users
TallyPrime covers Phase 1 Generation out of the box: QR codes on simplified invoices, Arabic field support, and VAT returns. For Phase 2 Integration, Tally users typically need either a certified connector or a structured migration to ERPNext. We help you decide based on transaction volume, customisation depth and roadmap.
Keep Tally + add a connector
- ✓ Lower change-management friction for finance teams
- ✓ Phase 1 already handled natively
- ✗ Phase 2 needs an external Fatoora middleware
- ✗ Limited inventory, manufacturing and HR modules
- ✗ Per-user licence cost grows with headcount
One system, end-to-end
- ✓ Phase 1 + Phase 2 inside the same invoice screen
- ✓ Open-source, no per-user licence inflation
- ✓ CRM, inventory, manufacturing, HR & payroll included
- ✓ MAAS Consult migrates Tally data — zero gap period
- ✓ Dual-certified partner: both Tally and ERPNext
Step-by-step: from VAT invoice today to Fatoora-cleared tomorrow
This is the exact runbook MAAS Consult follows when we onboard a Saudi business onto ERPNext for Phase 2. Most engagements finish in 4 to 6 weeks.
Discovery & gap audit
We map your current invoicing flow, customer/item masters, VAT setup and chart of accounts against ZATCA's mandatory fields. You leave with a fixed-scope plan.
ERPNext configuration & data migration
Company, fiscal year, tax templates and bilingual print formats are configured. Opening balances, customers, suppliers and items are migrated from Tally / Excel / legacy systems.
ZATCA onboarding (CSID issuance)
We generate your CSR, request the Compliance CSID, run ZATCA's compliance test invoices, then upgrade to a Production CSID — all from inside ERPNext.
Clearance & reporting workflow
B2B Standard invoices are wired for real-time clearance; B2C Simplified invoices for 24-hour reporting. Failed submissions trigger automatic alerts.
UAT with your finance team
We run user acceptance testing with your actual invoice scenarios — credit notes, returns, multi-branch transactions — until your team signs off with confidence.
Go-live & after-sales support
Cut-over on a weekend. Then 90 days of post-go-live hand-holding, plus an annual ZATCA compliance health-check so you never fall behind a new wave.
Book your free ZATCA Phase 2 audit
30 minutes with a ZATCA-experienced consultant. We review your current invoicing setup, identify the gaps against Fatoora's requirements, and send you a written roadmap. No sales pressure — if Tally is the right answer, we'll say so.
A trusted ERP partner in Riyadh
MAAS Consult is a financial consulting firm based in Riyadh, Saudi Arabia, specialising in ERPNext and TallyPrime. We've onboarded trading houses, manufacturers, holding groups and professional services firms onto Phase 2 — quietly, on time, without invoice downtime.
READY TO GET COMPLIANT?
Wave 24 deadline:
30 June 2026
Most engagements finish in 4–6 weeks. Start today and go live with time to spare.
Get Free ZATCA Audit → 💬 WhatsApp: +966 53 213 6446GOOGLE REVIEWS
Very prompt. And happy to have kind patience to explain all the queries till one understood it.
Excellent service from MAAS Consult. They completed our ZATCA Phase 2 integration on time without any disruption to our invoicing. The team was professional throughout the entire process.
We migrated from Tally to ERPNext with full ZATCA compliance. MAAS Consult managed everything — our finance team was trained and confident within a week of go-live. Highly recommended.
Google rating score: 4.9 of 5, based on 235 reviews
Frequently asked questions
Phase 2 (the Integration Phase of Fatoora) requires VAT-registered businesses in Saudi Arabia to integrate their invoicing systems with ZATCA's Fatoora platform and exchange invoices as UBL 2.1 XML with cryptographic stamps, UUIDs and a QR code. Unlike Phase 1 — where you simply generated a structured invoice file — Phase 2 requires your ERP to be directly and continuously connected to ZATCA's API.
Wave 24 covers businesses whose annual VAT-taxable revenue exceeded SAR 750,000 in 2022 or 2023. The compliance deadline is 30 June 2026. ZATCA typically sends an official notification letter six months before the cutover — if you haven't received one yet, check with MAAS Consult for a free wave assessment.
Clearance applies to Standard Tax Invoices (B2B). Before you can send the invoice to your buyer, it must be submitted to ZATCA's Fatoora platform, stamped with a clearance signature, and returned — all in near real-time (usually under 3 seconds). Reporting applies to Simplified Tax Invoices (B2C, e.g. retail). You issue the invoice immediately, but must report it to ZATCA within 24 hours. ERPNext handles both automatically in the background.
Yes. ERPNext has native ZATCA Phase 2 support built in — including UBL 2.1 XML generation, CSID cryptographic stamping, TLV QR codes, Fatoora API integration, and 5-year audit archiving. However, activating and correctly configuring this requires a certified partner who understands both the Frappe/ERPNext framework and ZATCA's technical requirements. MAAS Consult has completed 800+ of these configurations.
Yes for Phase 1 compliance. For Phase 2 integration, TallyPrime users need either a certified Fatoora middleware connector or a structured migration to ERPNext. MAAS Consult is certified for both TallyPrime and ERPNext, so we can give you an honest recommendation based on your transaction volume, complexity, and growth roadmap — without bias toward either platform.
Penalties start at SAR 1,000 for a first offence and escalate to SAR 50,000 for repeat violations. More critically, ZATCA has the power to suspend your business's ability to issue invoices entirely until you achieve compliance. For businesses that invoice daily, even a few days of suspension can cause serious operational and reputational damage. The cost of compliance is always lower than the cost of non-compliance.
ZATCA requires certain invoice fields to be in Arabic — including seller name, VAT registration number, and some line-item descriptions. ERPNext configured by MAAS Consult generates fully bilingual Arabic-English invoices that satisfy all ZATCA mandatory field requirements. The layout is right-to-left compatible and can carry your company branding.
Most MAAS Consult ZATCA Phase 2 engagements complete in 4 to 6 weeks from signed proposal to production go-live. Simple businesses with clean data can be live in 2–3 weeks. Complex multi-branch businesses or those migrating from a legacy system may take 6–10 weeks. Given the Wave 24 deadline of 30 June 2026, businesses should initiate the process immediately.
Yes. MAAS Consult serves businesses across all of Saudi Arabia including Riyadh, Jeddah, Dammam, Al Khobar, and the Eastern Province. Our implementation team works remotely and on-site as required. Eastern Province businesses in manufacturing, trading, and petrochemical supply chains are a core part of our client base.
Fill in the free audit form on this page, or message us directly on WhatsApp at +966 53 213 6446. We'll schedule a 30-minute call to review your current setup, confirm your Wave assignment, and outline the fastest compliant path. There is no cost and no obligation for the initial audit.