ZATCA Phase 2 e-invoicing for transport and equipment-hire companies (2026 guide)

ZATCA’s Phase 2 e-invoicing now reaches almost every Saudi transport and equipment-hire business. Wave 24 required taxpayers with VAT-subject revenues above SAR 375,000 to integrate with the Fatoora platform by 30 June 2026, and Wave 25, announced on 24 July 2026, halves the threshold to SAR 187,500 with a 1 February 2027 deadline. If you run trucks or hire out equipment in the Kingdom, this guide covers what applies, when, and what your invoicing system must do.

This article is marketing information, not legal or tax advice. Regulatory details were last reviewed on 7 August 2026 against the ZATCA sources linked below; verify your own obligations with ZATCA or your tax adviser.

Key takeaways

• Phase 1 (generation) has been mandatory since 4 December 2021; Phase 2 (integration with ZATCA’s Fatoora platform) started 1 January 2023 and rolls out in waves by revenue (ZATCA, e-invoicing overview, checked August 2026).
• The threshold ladder is dropping fast: Wave 23 covered revenues above SAR 750,000 with a 1 January to 31 March 2026 window (EY Global tax alert, 2025); Wave 24 covered SAR 375,000 by 30 June 2026 (ZATCA announcement, reported by VATupdate, 2026); Wave 25 covers SAR 187,500 by 1 February 2027 (ZATCA, 24 July 2026).
• SAR 187,500 in annual revenue is roughly one truck working part of a year. At Wave 25 thresholds, e-invoicing integration is effectively universal for transport and hire businesses.
• Phase 2 means machine-format invoices with additional fields, cryptographic stamping and live integration with Fatoora, per ZATCA’s wave announcements and published e-invoicing specifications, not PDFs typed at month-end.
• There is no transport-sector exemption in the published wave criteria: the test is residence and VAT-subject revenue, not industry.
• Most fleet software does not invoice, and most invoicing software knows nothing about fleets. That gap is exactly where Fleetric sits, with ZATCA-ready invoicing inside the fleet platform.

What is ZATCA Phase 2, and who must comply?

Phase 2, the “Integration Phase” of Saudi Arabia’s e-invoicing programme, requires resident taxpayers to connect their invoicing systems to ZATCA’s Fatoora platform and issue e-invoices in ZATCA’s specified format with additional fields. It started on 1 January 2023 and applies in waves selected by VAT-subject revenue, from the largest taxpayers downward (ZATCA, e-invoicing overview and wave announcements, checked August 2026).

The selection test is simple and sector-blind: residence in the Kingdom plus revenue above the wave threshold in any of the reference years. A haulage contractor, a crane-hire firm and a water-tanker operator are treated exactly like a retailer with the same revenue. ZATCA states that it notifies every targeted taxpayer at least six months before that wave’s integration date (ZATCA, Wave 25 announcement, 24 July 2026).

Which wave is my transport company in?

Find the highest annual VAT-subject revenue your business recorded between 2022 and 2025 and read the ladder. The last three announced waves cover, in order (each per the ZATCA announcement or EY tax alert cited):

Wave	Revenue threshold (any year 2022-2025)	Integration deadline	Source
23	above SAR 750,000	1 January - 31 March 2026	EY Global tax alert, 2025
24	above SAR 375,000	30 June 2026	ZATCA announcement; VATupdate, 2026
25	above SAR 187,500	1 February 2027	ZATCA announcement, 24 July 2026

Two practical readings of that table:

• If your revenue ever exceeded SAR 375,000, your deadline has already passed. Wave 24’s date was 30 June 2026. A transport business in that band that has not integrated is late, not early.
• If you are anywhere above SAR 187,500, you are in Wave 25 or earlier. For context, GASTAT’s Road Transport Statistics recorded about 15.88 million registered roadworthy vehicles in the Kingdom by the end of 2024, and a single truck’s annual revenue typically clears the Wave 25 threshold on its own. Treat integration as inevitable and choose tooling accordingly.

Waves continue to be announced; ZATCA has stepped the threshold down with each one, and nothing in the published criteria suggests the ladder stops at 25.

What does Phase 2 actually require an invoicing system to do?

A Phase 2-ready system issues invoices as structured data that ZATCA’s platform can validate, not documents a human formats. Per ZATCA’s Wave 25 announcement, integration means connecting the taxpayer’s e-invoicing solution to Fatoora, issuing e-invoices “based on a specific format”, and including additional fields beyond Phase 1’s requirements (ZATCA, 24 July 2026).

Concretely, ZATCA’s published e-invoicing specifications (the Electronic Invoice XML Implementation Standard and Data Dictionary on ZATCA’s developer portal) define:

• Machine format. Invoices as structured XML (or PDF with embedded XML), not free-form documents.
• Cryptographic stamping. Each invoice carries a cryptographic stamp tied to the issuing system, so origin and integrity are verifiable.
• Invoice chaining. Each invoice embeds a hash of the previous invoice, which makes gaps and after-the-fact edits detectable.
• QR codes on invoices, extended from the Phase 1 requirement.
• Two handling models. Standard tax invoices (typically B2B, which is most transport and hire billing) are cleared through Fatoora, while simplified invoices are reported after issue, per ZATCA’s implementation guidelines.

The consequence for a fleet business: month-end invoicing out of spreadsheets and Word templates does not survive contact with Phase 2. The invoice has to be produced by a system that speaks ZATCA’s format natively.

What does this mean for a fleet or equipment-hire business specifically?

Transport billing has a shape that generic accounting tools handle badly: an invoice line is usually a trip, a tonnage, a day of hire or a month of standby, and the proof behind it lives in the fleet system, not the ledger. Phase 2 does not change what you bill; it changes how defensibly the invoice must be produced, and that raises the cost of keeping billing disconnected from operations.

Three patterns worth planning around:

1. Trip-backed invoices. When each line traces to a recorded trip with a vehicle, a route and a timestamp, disputes get shorter and audits get boring, which is the goal. The mandated tracking feed most Saudi fleets already produce for WASL (see the WASL compliance guide) is the natural evidence layer.
2. Recurring hire. Equipment-rental billing (monthly hire, standby days, mobilisation charges) is repetitive and deadline-driven, exactly the workload that benefits from system-generated invoices rather than a coordinator’s calendar memory.
3. One system of record. When the invoicing system and the fleet system are the same thing, revenue lands against the vehicle that earned it, which is what makes profit per vehicle computable at all rather than a quarterly estimate.

How does Fleetric handle ZATCA-ready invoicing?

Fleetric is a fleet profit intelligence platform for GCC fleets, in daily production with a construction fleet in Abu Dhabi, that reads mandated tracking feeds and computes per-vehicle profit. Unlike tracking products, it includes invoicing, and unlike accounting products, its invoices know which vehicle and trip earned each line, which is what makes it relevant to this article.

Stated honestly:

• What is built. Fleetric’s invoicing is ZATCA Phase 2-ready by design: invoices are generated as structured data with QR codes and previous-invoice-hash chaining, so the requirements above are an architecture, not a retrofit. Invoices, trips and vehicles live in one system, in English and Arabic, in SAR and AED.
• Where it fits. Fleets and hire businesses that want billing and per-vehicle profit in the same place, on top of the tracking they already run. Published pricing: Starter AED 120, Pro AED 95 per truck per month; Enterprise (by quote) covers certified IVMS hardware and in-Kingdom data residency.
• Limitations, stated plainly. Fleetric is early stage, with one production fleet, and that fleet is in the UAE, not the Kingdom. Fatoora onboarding is performed per customer as part of rollout, and your tax adviser, not this article, should confirm your wave and obligations. Fleetric is not a tax advisory firm.

If your Wave 25 letter has arrived, or your revenue says it will, book a demo and bring one month of real invoices; the walkthrough uses your numbers, not ours.

FAQ

Does ZATCA Phase 2 e-invoicing apply to transport and equipment-hire companies?

Yes. Phase 2 applies by revenue, not by sector. ZATCA’s Wave 25 criteria (announced 24 July 2026) cover every resident taxpayer whose VAT-subject revenues exceeded SAR 187,500 in any year from 2022 to 2025, which includes virtually every trucking, haulage and equipment-rental business in the Kingdom. There is no transport-sector exemption in the published wave criteria.

What is the current ZATCA integration deadline for smaller fleet businesses?

Wave 25, announced by ZATCA on 24 July 2026, requires taxpayers with VAT-subject revenues above SAR 187,500 (in 2022, 2023, 2024 or 2025) to integrate their invoicing systems with the Fatoora platform by 1 February 2027. ZATCA says it notifies each wave at least six months before its integration date.

What does Phase 2 require that Phase 1 did not?

Phase 1 (mandatory since 4 December 2021) required generating and storing e-invoices with QR codes. Phase 2 (rolling out in waves since 1 January 2023) additionally requires integrating your invoicing system with ZATCA’s Fatoora platform, issuing invoices in ZATCA’s specified format with additional fields, and cryptographic stamping, per ZATCA’s published wave announcements and e-invoicing specifications.

Can fleet management software handle ZATCA e-invoicing?

Most fleet platforms do not invoice at all, so ZATCA compliance falls to a separate accounting system that knows nothing about trips or vehicles. Fleetric is built the other way around, with ZATCA-ready invoicing inside the fleet platform, so the invoice lines trace to the trips, vehicles and hire periods that earned them.

Sources

• ZATCA, e-invoicing overview (Phase 1: 4 December 2021; Phase 2: 1 January 2023): zatca.gov.sa/en/E-Invoicing, checked August 2026
• ZATCA, “Criteria for Selecting the Targeted Taxpayers in Wave 25”, 24 July 2026: zatca.gov.sa/en/MediaCenter/News/Pages/Wave25-E-invoicing.aspx
• ZATCA Wave 24 announcement (SAR 375,000, 30 June 2026), as reported by VATupdate, June 2026
• EY Global tax alert, “Saudi Arabia announces 23rd wave of Phase 2 e-invoicing integration” (SAR 750,000; 1 January - 31 March 2026), 2025
• ZATCA, Electronic Invoice XML Implementation Standard and Data Dictionary, developer portal, checked August 2026
• GASTAT, Road Transport Statistics 2024 (registered roadworthy vehicles), 2025 release