ZATCA Wave 24: A Complete SME Compliance Guide for June 30, 2026

ZATCA Wave 24: The Clock Is Ticking for Saudi SME E-Invoicing Compliance

June 30, 2026 is the date every Saudi business owner with annual VAT-taxable revenue above SAR 375,000 needs to take seriously. The Zakat, Tax and Customs Authority (ZATCA) has officially announced the criteria for Wave 24 of Phase 2 e-invoicing integration, pulling thousands of small and medium-sized enterprises into mandatory scope for the first time. This wave lowers the revenue threshold from SAR 750,000 (Wave 23) down to SAR 375,000 — meaning restaurants, online stores, logistics companies, and professional service firms that previously operated under Phase 1 rules must now upgrade to full Fatoora platform integration.

ZATCA has also extended its Penalty Cancellation and Exemption Initiative through June 30, 2026 — the very same date as the Wave 24 deadline. After that date, non-compliance fines of SAR 5,000 to SAR 50,000 per violation apply with no waiver. The window to comply at zero financial cost is closing fast.

Who Does ZATCA Wave 24 Cover?

Wave 24 targets any taxable person whose annual VAT-subject revenues exceeded SAR 375,000 in any one of the years 2022, 2023, or 2024. You only need to have crossed this threshold in a single year to be in scope. ZATCA began notifying affected businesses from April 1, 2026, with all targeted taxpayers required to complete integration by June 30, 2026.

The halving of the revenue threshold compared to Wave 23 has pulled in a significant new segment of Saudi SMEs, including:

• Mid-size restaurants, cafes, and food and beverage chains
• E-commerce stores and multi-channel retailers
• Delivery, courier, and last-mile logistics companies
• Professional service firms: accounting, consulting, design, and IT
• Subcontractors and mid-scale suppliers in construction and manufacturing
• Fitness studios, beauty salons, and private healthcare providers

Even if you have not yet received an official ZATCA notification, proactively verifying your eligibility is essential — you cannot afford to wait for a letter that may arrive close to the deadline.

Technical Integration Requirements for the Fatoora Platform

Phase 2 integration is fundamentally different from Phase 1. Under Phase 1, businesses simply generated electronic invoices in a compliant format with a QR code. Phase 2 demands a live, real-time API connection to ZATCA's Fatoora platform, with specific technical requirements:

• XML/UBL 2.1 format: Invoices must be generated in XML following ZATCA's Universal Business Language 2.1 specification — not merely as PDF files
• Cryptographic stamps and unique identifiers: Every invoice must carry a tamper-proof digital signature and a UUID
• B2B invoice clearance: Tax invoices issued to other businesses must be cleared by ZATCA in real time before delivery to the buyer
• B2C simplified invoice reporting: Consumer-facing invoices must be reported to Fatoora within 24 hours of issuance
• ZATCA-certified solution only: Using a non-certified e-invoicing tool means non-compliance even if you are generating electronic invoices
• Server IP whitelisting: Your e-invoicing server IP addresses must be registered and whitelisted with ZATCA

Full integration typically takes two to four weeks from start to go-live. Given that compliance demand is surging as the June 30 deadline approaches, certified integration partners are increasingly backlogged. Starting today is materially better than starting next week.

Penalties for Non-Compliance: What Is at Stake

ZATCA has established financial penalties ranging from SAR 5,000 to SAR 50,000 per violation for businesses that fail to comply with Phase 2 requirements after the deadline. Financial penalties are only part of the risk picture. Continuing to issue invoices without Fatoora integration after June 30, 2026 exposes your business to:

• B2B invoice rejection — your corporate clients will be unable to claim input VAT deductions on purchases from you, which directly damages your commercial relationships
• Input VAT recovery complications for your own business purchases
• Increased probability of being selected for a ZATCA compliance audit
• Reputational damage with procurement teams at larger partners who prioritize compliant suppliers

Businesses that continue Phase 1-style workflows after the Wave 24 deadline face invoice rejection, VAT deductibility complications, and direct financial exposure — all avoidable by acting now.

How Watily Solves This

Saudi SME owners should not need to hire an IT developer or a tax consultant just to achieve ZATCA compliance. Watily's ZATCA-compliant e-invoicing integration is built specifically for Saudi business owners who need a fast, straightforward path to Phase 2 compliance — no technical expertise required. The solution provides:

• Ready-to-use API integration with ZATCA's Fatoora platform, fully certified by the authority
• Automatic generation of XML/UBL 2.1 invoices with cryptographic stamps and digital signatures
• Real-time B2B clearance and automatic B2C reporting within 24 hours
• An intuitive Arabic-first dashboard for issuing invoices, managing records, and running compliance reports
• Daily reconciliation reports to match your records against Fatoora data
• Dedicated Arabic-language support from a team experienced in Saudi VAT compliance requirements

You can get started and reach full compliance quickly. Explore Watily's e-invoicing solution and see how thousands of Saudi businesses are managing their Fatoora integration through Watily's platform.

Six Practical Steps to Wave 24 Compliance

1. Confirm your eligibility: Review your VAT-taxable revenues for 2022, 2023, and 2024 against the SAR 375,000 threshold — one year above it is sufficient to be in scope
2. Choose a ZATCA-certified solution: Verify that your chosen e-invoicing tool appears on ZATCA's official list of certified solutions before committing
3. Register on the Fatoora portal: Obtain your API credentials and begin the technical onboarding process with your chosen integration partner
4. Test in ZATCA's simulation environment: Validate all invoice types — B2B tax invoices, B2C simplified invoices, credit notes — before going live
5. Train your finance and operations teams: Ensure your accountants and sales staff understand the new workflow so invoices are issued correctly from day one
6. Go live and monitor daily: Begin live issuance and review daily reconciliation reports closely during the first weeks to catch any discrepancies early

June 30, 2026 is closer than it looks. Every day of delay narrows your integration window and raises the risk of missing the deadline. Register with Watily today and get a ZATCA-compliant e-invoicing solution that lets you spend your time growing your business — not managing fines that can reach SAR 50,000 per violation.