E-invoicing for salons and service shops: what ZATCA asks for and what you need

First question: are you registered for VAT at all

E-invoicing applies to businesses registered for VAT. Registration is mandatory once your taxable revenue passes SAR 375,000 a year, and optional above SAR 187,500. Below that, neither registration nor e-invoicing applies to you, and you can give your customer an ordinary receipt.

So the first step is not buying software. The first step is knowing your number. Add up the last twelve months of revenue, and if you are close to the threshold, register before you cross it, because late registration carries a penalty.

The two phases: generation and integration

Phase one, the generation phase, began in December 2021 and covers everyone registered: no more invoices written by hand or in Word. The invoice comes out of an electronic system with set fields, and a consumer invoice carries a QR code.

Phase two, the integration phase, began in January 2023 in waves by revenue. ZATCA notifies each wave months ahead, and the latest waves have reached businesses with revenue above SAR 187,500. In this phase the system that issues your invoice talks to the Fatoora platform directly.

The practical difference is simple. In the first phase your invoice has to look right. In the second, it has to reach the authority.

The salon’s invoice: simplified, and reported within a day

A service shop sells to individuals, so its invoice is a simplified tax invoice. It does not need the authority’s approval before you hand it to the customer, but it is reported to the authority within twenty-four hours of being issued, and it carries a QR code the authority’s app reads and verifies.

If a business customer asks for an invoice in the company’s name with its VAT number, that is a standard tax invoice, and in phase two it is cleared by the authority at the moment it is issued, before you hand it over.

Refunds have their own document. When you return money to a customer you do not delete the invoice. You issue a credit note that points to it. The original stays in the record, which is exactly what the authority wants.

• a simplified invoice for the individual customer, with a QR code
• a standard tax invoice for businesses, in their name and number
• a credit note for a refund instead of a deletion

Why it should come out of the booking system, not a second program

A salon already has a system that records every visit: who came, which service, how much they paid and how. Moving all of that by hand into a separate accounting program means writing every invoice twice, and on a busy day it barely gets written once.

In WGTK the invoice comes out of the visit itself. You switch e-invoicing on in Settings with your VAT number and the activation code from the Fatoora platform, and from then on every visit you record or take payment for produces its simplified invoice with a QR code and reports it to the authority without you doing anything. A refund produces its credit note by itself.

At the end of the month you export a file for your accountant with every invoice and credit note, instead of being asked for photos of receipts. The record stays with you for as long as the rules require.

If you have not reached the threshold yet

You do not need to switch anything on. Your customer gets an ordinary receipt from the same visit, and e-invoicing stays off until you register for VAT. The day you register, you switch it on in the same place without changing how you work.

The point is that the transition never becomes a project. A shop that grows reaches the threshold already in order, with every visit recorded, and the invoice becomes one more field rather than a new system.