The Complete Guide to ZATCA Phase 2 Compliance in Saudi Arabia
What ZATCA Phase 2 requires, who it applies to, the penalties for non-compliance, and how to integrate e-invoicing on SAP, Microsoft Dynamics, and Oracle before your wave deadline.
Ascent Tech Solutions · 12 May 2026 · 8 min read
ZATCA Phase 2 (the “Integration” phase) is now mandatory for VAT-registered businesses in Saudi Arabia, rolled out in waves with firm deadlines. This guide explains what it requires and how to get compliant on any ERP.
Who does ZATCA Phase 2 apply to?
All VAT-registered businesses in Saudi Arabia are in scope, assigned to waves by ZATCA based on annual revenue. Once your wave is announced, you have a fixed window to integrate your e-invoicing system with the ZATCA (Fatoorah) platform.
What Phase 2 requires
- Compliant UBL XML invoices with all mandatory fields.
- QR codes on every tax invoice.
- Cryptographic stamps and unique identifiers.
- Live integration with Fatoorah for clearance (B2B) and reporting (B2C).
What are the penalties for non-compliance?
ZATCA can levy escalating financial penalties for non-compliant invoices, missing QR codes or stamps, and failure to integrate during your assigned wave. Beyond fines, a blocked invoicing process directly disrupts cash flow.
How to integrate — on any ERP
The path is the same whether you run SAP, Microsoft Dynamics, or Oracle: a readiness assessment, configuration of compliant documents, integration with Fatoorah, validation against the platform, and ongoing monitoring as rules evolve. A typical integration takes 4–8 weeks.
Ascent delivered full Phase I & II compliance for AL Tilal Steel on SAP ECC three weeks ahead of deadline, with zero penalties.
Ready to assess your readiness? Book a ZATCA readiness review.