𝐙𝐀𝐓𝐂𝐀 𝐒𝐮𝐦𝐦𝐚𝐫𝐲 𝐈𝐧𝐯𝐨𝐢𝐜𝐞

A Summary Invoice in Saudi Arabia is used to combine multiple transactions into one invoice, instead of creating separate invoices for each transaction. This is helpful for businesses that make frequent deliveries or provide regular services.

The Summary Invoice must follow ZATCA regulations, including the e-invoicing system (Fatoorah), and comply with Saudi VAT rules. It’s a more efficient way to handle invoicing in specific business situations while ensuring all tax requirements are met.

Key Points to Consider

• Consolidation of Multiple Transactions: A summary invoice is used when multiple transactions need to be consolidated. This is useful when a business has regular, recurring sales, or deliveries, and it is more efficient to issue one invoice rather than multiple invoices.
• VAT Application: For domestic sales within Saudi Arabia, 15% VAT is applied unless the transaction is exempt or zero-rated (e.g., export transactions).
• Fatoorah Compliance: As with all invoices, a summary invoice must be issued through the Fatoorah platform, and the invoice must be electronically generated and submitted to ZATCA.
• Invoice Numbering: Each summary invoice must have a unique number to ensure proper tracking and reporting, as per ZATCA's e-invoicing requirements.
• Reporting VAT to ZATCA: Businesses must report their VAT transactions accurately. For summary invoices, the VAT paid or collected on the goods/services must be detailed and correctly reported in VAT filings.
• Record Keeping: Businesses should maintain detailed records for each summarized transaction (individual invoices) for at least 5 years, as ZATCA may request documentation for audits.

Calculating VAT on Summary Invoice: -

A Saudi company, ABC Trading Co., sells electronic devices to a foreign business, XYZ Corporation (located in the USA), on a recurring basis. The deliveries are made in weekly batches, and the company wants to issue a monthly summary invoice.

A domestic sales agreement involves the weekly delivery of laptops and tablets throughout December, with shipments occurring each week from the 1st to the 30th. Each week, 50 laptops and 30 tablets will be delivered, totalling 200 laptops and 120 tablets by the end of the month. The unit price is SAR 2,000 per laptop and SAR 1,500 per tablet, and all transactions are subject to a 15% VAT rate.

For Laptops:

• Total per week: 50 laptops × SAR 2,000 = SAR 100,000
• Total for the month (4 weeks): 100,000 × 4 = SAR 400,000
• VAT on Laptops: 15% of SAR 400,000 = SAR 60,000

For Tablets:

• Total per week: 30 tablets × SAR 1,500 = SAR 45,000
• Total for the month (4 weeks): 45,000 × 4 = SAR 180,000
• VAT on Tablets: 15% of SAR 180,000 = SAR 27,000
• Total Invoice Amount: SAR 580,000 (goods) + SAR 87,000 (VAT) = SAR 667,000